10-K

 UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

 ^{(Mark One)}

x           ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended
March 31, 2006
or

o                  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

OF 1934

Commission File No. 001-31744

MENTOR CORPORATION
(Exact name of registrant as specified in its charter)

Minnesota	41-0950791
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

201 Mentor Drive, Santa Barbara, California 93111
(Address of principal executive offices) (Zip Code)

(805) 879-6000
(Registrant's telephone number, including area code)

Title of Each Class	Name of Each Exchange on Which Registered
Common Shares	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:  None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes x            No o

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes o            No x

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes x            No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in a definitive proxy or information statement incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K  o

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.  See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.  (Check one):

Large accelerated filer x Accelerated filer o Non-accelerated filer o

Indicate by check mark whether the Registrant is a shell company (as defined in Exchange Act Rule 12b-2).  Yes o            No x

Based on the closing sale price on the New York Stock Exchange as of the last business day of the Registrant's most recently completed second fiscal quarter (September 30, 2005), the aggregate market value of the Common Shares of the Registrant held by non-affiliates of the Registrant was approximately $1,616,340,841.  For purposes of this calculation, shares held by each executive officer, director and holder of 10% or more of the outstanding shares of the Registrant have been excluded in that such persons may be deemed to be affiliates.  This determination of affiliate status is not necessarily a conclusive determination for other purposes.

As of June 11, 2006, there were approximately  41,326,022 Common Shares outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's Proxy Statement for its Annual Meeting of Shareholders to be held on September 13, 2006 are incorporated by reference into Part III of this Form 10‑K.

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MENTOR CORPORATION

TABLE OF CONTENTS

ITEM	PART I	PAGE
1.	Business	4
	General	4
	Recent Events	5
	Principal Products and Markets	6
	Sales and Marketing	7
	International Operations	7
	Competition	8
	Government Regulations	8
	Medicare, Medicaid and Third Party Reimbursement	11
	Product Development	15
	Patents and Licenses	15
	Raw Material Supply and Single Source Suppliers	15
	Seasonality	16
	Working Capital	16
	Employees	16
	Discontinued Operations	16
	Executive Officers of the Registrant	17
	Available Information	18
1A.	Risk Factors	19
1B.	Unresolved Staff Comments	29
2.	Properties	29
3.	Legal Proceedings	30
4.	Submission of Matters to a Vote of Security Holders	30
	PART II
5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	31
6.	Selected Financial Data	33
7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	34
7A.	Quantitative and Qualitative Disclosures About Market Risk	49
8.	Financial Statements and Supplementary Data	50
9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	50
9A.	Controls and Procedures	50
9B.	Other Information	53
	PART III
10.	Directors and Executive Officers of the Registrant	53
11.	Executive Compensation	53
12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	53
13.	Certain Relationships and Related Transactions	53
14.	Principal Accountant Fees and Services	53
	PART IV
15.	Exhibits and Financial Statement Schedules	54
	Report of Independent Registered Public Accounting Firm	55
	Consolidated Financial Statements	56
	Signatures	87
	Exhibit Index	88

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PART I

FORWARD-LOOKING STATEMENTS

Unless the context indicates otherwise, when we refer to "Mentor," "we," "us," "our," or the "Company" in this Form 10-K, we are referring to Mentor Corporation and its subsidiaries on a consolidated basis.  Various statements in this Form 10-K or incorporated by reference into this Form 10-K, in future filings by us with the SEC, in our press releases and in our oral statements made by or with the approval of authorized personnel, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are based on current expectations and are indicated by words or phrases such as "anticipate," "estimate," "expect," "intend," "project," "plan," "believe," "will," "seek," and similar words or phrases and involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  Some of the factors that could affect our financial performance or cause actual results to differ from our estimates in, or underlying, such forward-looking statements are set forth under "Item 1A -Risk Factors" or elsewhere in this Form 10-K.  Forward-looking statements include statements regarding, among other things:

• Our anticipated growth strategies;

• Our intention to introduce or seek approval for new products;

• Our ability to continue to meet FDA and other regulatory requirements;

• Our anticipated outcomes of litigation and regulatory reviews; and

• Our ability to replace sources of supply without disruption and regulatory delay

• Our expectation that selling, general and administrative expenses will increase as a result of the adoption of SFAS 123(R) - "Share-Based Payment" which requires all share-based payments be recognized in the financial statements.

These forward-looking statements are based largely on our expectations and are subject to a number of risks and uncertainties, many of which are beyond our control.  Actual results could differ materially from these forward-looking statements as a result of the facts described in "Item 1A - - Risk Factors" or elsewhere including, among others, problems with suppliers, changes in the competitive marketplace, significant product liability or other claims, difficulties with new product development, the introduction of new products by our competitors, changes in the economy, United States Food Drug and Administration ("FDA") delay in approval or rejection of new or existing products, changes in Medicare, Medicaid or third-party reimbursement policies, changes in government regulations, use of hazardous or environmentally sensitive materials, inability to implement new information technology systems, inability to integrate new acquisitions, and other events.  We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.  In light of these risks and uncertainties, we cannot assure you that the forward-looking information contained in this Form 10-K will, in fact, transpire.

ITEM 1. BUSINESS.

Mentor Corporation was incorporated in Minnesota in 1969.  Our fiscal year ends on March 31, and references to fiscal 2006, fiscal 2005 or fiscal 2004 refer to the years ended March 31, 2006, 2005 or 2004, respectively.

General

We develop, manufacture and market a range of products serving the aesthetic medicine market, including plastic and reconstructive surgery.  Aesthetic surgery products include surgically implantable prostheses for plastic and reconstructive surgery, capital equipment and consumables used for soft tissue aspiration or body contouring (liposuction), and facial aesthetics products. 

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Historically we have had three reportable segments: aesthetic and general surgery, surgical urology, and clinical and consumer healthcare.  In October 2005, we announced a strategy to increase our focus on aesthetic medicine, and as a result we pursued strategic alternatives for our surgical urology and clinical and consumer healthcare businesses.  On March 27, 2006, we announced that we received a binding offer from Coloplast A/S ("Coloplast") regarding the sale of these businesses.  On May 17, 2006, we entered into a definitive purchase agreement for the sale of our surgical urology and clinical and consumer healthcare business segments (collectively, the "Urology Business") to Coloplast for total consideration of $463,225,000, of which $456,137,500 would be in cash and $7,087,500 in non-cash consideration, and on June 2, 2006 we completed this sale to Coloplast. 

In connection with the sale, we have entered into a Transition Services Agreement ("TSA") and various supply agreements.  Pursuant to the TSA, we will provide to Coloplast, and Coloplast will provide to us, services including accounting, regulatory, clinical, information technology, customer support, and use of facilities in exchange for specified fees.  Under the supply agreements we will supply various products, including silicone gel-filled testicular implants to Coloplast, and Coloplast will supply to us various components for the manufacture of our breast implants.  It is anticipated that services provided under the TSA will continue for a period of up to twelve months, and the supply agreements range from a period of 6-36 months.  As a result of the sale, the operations of our surgical urology and clinical and consumer healthcare segments have been classified as discontinued operations in our consolidated balances sheets, consolidated statements of income, consolidated statement of cash flows and the notes to the consolidated financial statements included herein for all periods presented.  The following information relates to our continuing operations in the aesthetic medicine business and does not discuss (other than briefly) the business of our discontinued segments.  For further discussion related to discontinued operations, see "Item 7, Management Discussion and Analysis of Financial Condition and Results of Operations" and Note T of the notes to consolidated financial statements of this Form 10-K.  

Recent Events

On April 3, 2006, we submitted a pre-market approval application to the U.S. Food and Drug Administration ("FDA") for our Contour Profile^® silicone gel-filled breast implant products ("CPG^™").  The FDA has initiated its review of our application with the exception of our clinical module, which based on discussions with FDA will require additional information, and we are in the process of collecting that information.   

On March 20, 2006, we signed a non-binding letter of intent with Niadyne, Inc. to distribute Niadyne's innovative NIA 24^™ line of science-based cosmeceutical products used to improve and restore the healthy appearance of the skin.  We believe that these cosmeceutical products will complement our facial aesthetics business. 

On February 6, 2006, we announced that, with respect to our Puragen Plus™ program in the U.S., we had identified potential issues that required further evaluation of our clinical study data and would result in a delay to our PMA submission timeline.  We performed this evaluation, and we concurrently reviewed some of our critical production processes.  Based on the results of this evaluation we have developed a plan to move forward with our Puragen Plus™ PMA process, and are targeting to submit the first module to FDA in late summer or early fall this year, and to complete the submission in the spring of 2007.

On July 28, 2005, we received an "approvable letter" with conditions from the FDA on our pre-market approval application for our MemoryGel^™ round silicone gel-filled breast implants.  The approvable letter stipulates a number of conditions which we must satisfy in order to receive FDA approval to market and sell silicone gel-filled breast implants in the United States.  These conditions were generally consistent with those conditions that the advisory panel, composed of outside experts selected by the FDA, had recommended in their April 2005 review of our PMA application.  We remain in discussion with the FDA regarding the conditions for approval of our MemoryGel^™ breast implant pre-market approval application, including discussions regarding post-market patient monitoring and data collection.  We expect to incur additional expenses in connection with such post-market patient monitoring and data collection, which could be substantial.  In addition, we cannot guarantee that the FDA will provide final approval, nor can we determine when the FDA's decision regarding approval will be made.  

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Principal Products and Markets

Our aesthetic medicine products fall into three general categories: breast implants, body contouring, and other aesthetics which includes facial aesthetics products.  Net sales for each of these product categories and the percentage contributions of such net sales to total net sales are as follows:

	Year Ended March 31,
	2006			2005			2004
(in thousands)	Amount		%	Amount		%	Amount		%
Breast implants	$	233,189	87.0%	$	217,420	86.4%	$	194,052	88.8%
Body contouring	17,782		6.6%	18,609		7.4%	15,276		7.0%
Other aesthetics, including non-    surgical facial products	17,301		6.4%	15,697		6.2%	9,109		4.2%
Total	$	268,272	100.0%	$	251,726	100.0%	$	218,437	100.0%

We develop, produce, and market a broad line of breast implants, including saline-filled implants and silicone gel-filled (MemoryGel™) implants.  Our breast implants consist of a silicone elastomer shell that is either filled during surgery with a saline solution or pre-filled during the manufacturing process with silicone gel.  Our MemoryGel™ products come in varying degrees of cohesiveness.  Additionally, all of our implants have either a smooth or textured surface and are provided in a variety of sizes and shapes to meet the varying preferences of patients and surgeons.   

Mammary prostheses have applications in both cosmetic and reconstructive plastic surgery procedures.  These prostheses are used in augmentation procedures to enhance breast size and shape, correct breast asymmetries and help restore fullness after breast feeding.  During reconstruction procedures, mammary prostheses are utilized as a surgical solution to create a breast mound following a mastectomy.  Breast reconstruction is a surgical option for many women following a mastectomy, either at the time of surgery or a later date.

We carry a full line of breast reconstruction products including the Contour Profile Tissue Expander (CPX^®) family of breast expanders.  These expansion products, used in the first-stage of a two-stage breast reconstruction, create a pocket that will ultimately hold the breast implant that is placed in a subsequent second-stage operation.  All of the CPX devices utilize our proprietary BufferZone^™ self-sealing technology and Centerscope^™ injection port locators.  We also are the industry leader for single-stage breast reconstruction procedures, with our line of smooth and textured Becker implants, which are designed to be used as both an expander and a permanent implant.

We offer a line of extremity tissue expanders.  Extremity tissue expansion involves the process of growing additional tissue for reconstruction and skin graft procedures.  Some of the major applications of extremity tissue expansion include the correction of disfigurements such as burns, large scars and congenital deformities.

With respect to body contouring, we market through our subsidiary, Byron Medical, Inc., a complete line of liposuction products and disposable supplies. 

In fiscal 2005, we established two new business lines in the aesthetics arena, which we categorize under "other aesthtics": Mentor Solutions and Facial Aesthetics.  We had previously acquired a company called Inform Solutions and during fiscal 2005 combined it into a new business called Mentor Solutions.  The Mentor Solutions group offers software, consulting and business management tools to help plastic surgeons grow their business.

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In the Facial Aesthetics area, we launched our new dermal filler product, Puragen™, in a variety of international markets in May 2005 and have received additional international approvals throughout 2005.  Puragen™ is our proprietary non-animal based, hyaluronic acid dermal filler.  In February 2006, we announced that, with respect to our Puragen Plus™ program in the U.S., we had identified potential issues that required further evaluation of our clinical study data and would result in a delay to our PMA submission timeline.  We performed this evaluation, and we concurrently reviewed some of our critical production processes.  Based on the results of this evaluation we have developed a plan to move forward with our Puragen Plus™ PMA process, and are targeting to submit the first module to FDA in late summer or early fall this year, and to complete the submission in the spring of 2007.

We are developing a next-generation botulinum toxin type A product based on proprietary technology that yields a formulation designed to be purer than other commercially available botulinum toxin products.  During fiscal 2005, we initiated the United States phase 1 dose escalation study for cosmetic indications and during fiscal 2006 we initiated the United States phase 2 dose-finding study for cosmetic indications, and all patients in the Phase 2 study have been enrolled.  In addition, in early fiscal 2007 we initiated the United States phase 1 dose-escalation study focused on the treatment of adult-onset spasmodic torticollis/cervical dystonia. 

In March 2006, we signed a non-binding letter of intent with Niadyne Inc., to distribute Niadyne's innovative NIA 24^™ line of science-based cosmeceutical products used to improve and restore the healthy appearance of the skin.

 Sales and Marketing

We employ a domestic sales force for our aesthetic surgery and body contouring product lines.  The sales force provides product information and specific data support and related services to physicians, nurses and other health care professionals.  We promote our products through participation in and sponsorship of medical conferences and educational seminars, radio, newspaper, specialized websites, journal advertising, direct mail programs, and a variety of marketing support programs.  In fiscal 2005, we launched the first primetime advertising campaign in the industry for our saline breast implant products.  We ran commercials on ABC's Extreme Makeover program for the 2004/05 season while at the same time launching our Mentor4me.com patient education program designed to help educate interested women about breast augmentation surgery and help them locate surgeons.  During fiscal 2005 and into the beginning of fiscal 2006 these commercials also ran during ABC's Daytime programming and ABC's Desperate Housewives program.  In addition, we contribute to organizations that provide counseling and education for persons suffering from certain conditions, and we provide patient education materials for most of our products to physicians for use with their patients.  

International Operations

We export most of our product lines, principally to Canada, Western Europe, Central and South America, and the Pacific Rim.  Products are sold through our direct international sales offices in Canada, the United Kingdom, Germany, France, Benelux, Australia, Spain, Portugal and Italy, as well as through independent distributors in other countries.  Total foreign net sales, which are made through distributors and direct international sales offices, for continuing operations were $75.5 million, $65.2 million, and $55.0 million in fiscal 2006, 2005 and 2004, respectively.  Other than sales made through our international sales offices, which are denominated in the local currency of the sales office, export sales are made in United States dollars. 

In addition, we manufacture mammary implants in The Netherlands and facial products in the United Kingdom.  Total long-lived assets, excluding those related to discontinued operations, located in foreign countries were $29.5 million, $30.5 million, and $30.9 million as of March 31, 2006, 2005 and 2004, respectively. 

For additional information regarding our international operations, see "Note U - Business Segment Information" of the "Notes to the Consolidated Financial Statements."

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Competition

We believe we are one of the leading suppliers of cosmetic and reconstructive surgery products.  This belief is based upon information developed internally, public information sources, and information from independent research studies of market share.

In the domestic breast implant market, we compete primarily with one other company, Allergan Inc., which acquired Inamed Corporation in March 2006.  The primary competitive factors in this market currently are product performance and quality, range of styles and sizes, proprietary design, warranty programs, customer service and, in certain instances, price.  Outside the U.S., we compete with Allergan and various smaller competitors. 

Government Regulations

General

As a manufacturer of medical devices and developer of biologic products, our manufacturing processes and facilities are subject to continuing review by the FDA and various state and international agencies ("Agencies").  These Agencies inspect our processes and facilities from time to time to determine whether we are in compliance with various regulations relating to manufacturing practices and other requirements.  These Agencies have the power to prevent or limit further marketing of products based upon the results of these inspections.  These regulations depend heavily on administrative interpretation.  There can be no assurance that future interpretations made by these Agencies will not adversely affect us.  Failure to comply with these Agencies' regulatory requirements may result in enforcement action by these Agencies, including product recalls, suspension or revocation of product approval, seizure of product to prevent distribution, imposition of injunctions prohibiting product manufacture or distribution, and civil or criminal penalties. 

Advertising and promotion of medical devices and biologic products are regulated by the FDA and the Federal Trade Commission ("FTC") in the U.S. and by analogous agencies internationally.  A determination that we are in violation of regulatory requirements governing promotional activities could lead to imposition of various penalties, including warning letters, product recalls, injunctive relief, and civil or criminal penalties.

Products and materials manufactured internationally may come under Homeland Security statutes from time to time and could be considered for restricted entry into the United States by FDA and U.S. Customs.  The restricted entry of such products and materials could affect the manufacturing and sale of product domestically and internationally.  Our products may also be subject to export control regulations.

Regulation of Medical Devices

Under the Federal Food, Drug, and Cosmetic Act ("FDCA") as amended, the FDA has the authority to adopt regulations that: (i) set standards and general controls for medical devices; (ii) require demonstration of safety and effectiveness or other forms of data support prior to marketing devices which the FDA requires pre-market approval or clearance; (iii) require test data to be submitted to the FDA prior to evaluation in humans; (iv) permit detailed inspections of device manufacturing facilities; (v) establish Good Manufacturing Practices ("GMPs"), now referred to as the Quality System Regulation ("QSR") that must be followed in device and biologic manufacture; (vi) require reporting of certain adverse events, device malfunctions, and other post-market information to the FDA; and (vii) prohibit device or biologic exports that do not meet certain requirements.  The FDA also regulates promotional activities by device companies.  Essentially all of our products currently marketed are medical devices and are therefore subject to FDA regulation in the U.S. and analogous foreign agencies for the international countries to which we export our products.  We expect the products, such as Puragen Plus^™, that we are developing to also be subject to FDA regulation as either biologics or medical devices.

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The FDCA established complex procedures for FDA regulation of devices.  Devices are placed in three classes:  Class I (general controls to preclude misbranding or adulteration, compliance with labeling and other requirements), Class II (special controls and FDA clearance in addition to general controls), and Class III (a pre-market approval application ("PMA") before commercial marketing).  Class III devices are the most extensively regulated.  Class III devices require each manufacturer to submit to the FDA a PMA that includes information demonstrating the safety and effectiveness of the device.  The majority of our aesthetic surgery products are in Class III. 

In 1991, we submitted a PMA for our silicone gel-filled mammary prostheses to the FDA.  In 1992, the FDA's outside advisory panel on aesthetic surgery products indicated that although there was insufficient data to establish with reasonable certainty that silicone gel implants were safe and effective, there was a public health need for these types of implants.  Adopting the recommendations of the panel, the FDA denied the pending applications for the use of silicone gel-filled breast implants for augmentation, but provided for the continued availability of the implants for reconstruction and revision purposes on the basis of a public health need.  Since 1992, women have been required to enroll in a clinical program for future follow-up in order to receive gel-filled implants for reconstruction.  Patients are required to sign an informed consent form and physicians must certify that saline implants are not a satisfactory alternative.  We continue to ship these products under the terms of this clinical program, and these shipment activities require device tracking and documentation support to ensure compliance and accountability.

In 1994, the FDA published proposed guidelines for the PMA applicable to our saline-filled breast implants.  We submitted all the required data for our saline implants, and the FDA approved our application on May 10, 2000.  In conjunction with its review of the data, the FDA inspected our manufacturing facility in Irving, Texas and indicated the facility was in substantial compliance with the applicable regulations. 

In December 2003, we completed the submission of our PMA application for our MemoryGel^™ round silicone gel-filled breast implants to the FDA for breast augmentation, reconstruction and revision.  The FDA indicated that our PMA "is sufficiently complete to permit a substantive review and is, therefore, suitable for filing."  On January 8, 2004, the FDA released a "Draft Guidance for Saline, Silicone Gel, and Alternative Breast Implants."  This new draft guidance has additional requirements from the FDA's previously issued guidance document dated February 2003.  In August 2004, we amended our PMA based on January 2004 revised (new) FDA draft guidance and responded to other issues raised by the FDA.  On April 11-13, 2005, an advisory panel composed of outside experts selected by the FDA met to consider questions presented to it by the FDA regarding our and our competitor's PMA submissions and to make a recommendation to the FDA regarding whether the PMA applications should be approved.  In a majority 7-2 vote, the panel recommended approval of our PMA submission to the FDA, with conditions.  On July 28, 2005, we received an "approvable letter" with conditions from the FDA on our PMA application.  The approvable letter stipulates a number of conditions which we must satisfy in order to receive FDA approval to market and sell silicone gel-filled breast implants in the United States.  These conditions were generally consistent with those conditions that the advisory panel had recommended.  We remain in discussion with the FDA regarding the conditions for approval of our MemoryGel^™ breast implant PMA application, including discussions regarding post-market patient monitoring and data collection.  We expect to incur additional expenses in connection with such post-market patient monitoring and data collection, which could be substantial.  We cannot guarantee that the FDA will provide final approval, nor can we determine when the FDA's decision regarding approval will be made. 

On April 3, 2006, we submitted a pre-market approval application to the U.S. Food and Drug Administration ("FDA") for our Contour Profile^® silicone gel-filled breast implant products ("CPG^™").  The FDA has initiated its review of our application with the exception of our clinical module, which based on discussions with FDA will require additional information, and we are in the process of collecting that information.

We also have two pending applications for Medical Device Licenses in Canada for our silicone gel-filled breast implants.  An expert advisory panel was convened by the Canadian government on March 22, 2005 to review our pending application for Medical Device Licenses.  Health Canada held a public forum on these devices September 29, 2005.  We cannot predict the timing or outcome of the review and forum or determine when or if Health Canada will approve our product applications. 

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Biologics

Certain other products being developed by us are regulated by the FDA as biologics under the Public Health Service Act requiring pre-marketing approval, and are subject to regulations and requirements on preclinical and clinical testing, manufacture, labeling, quality control, storage, advertising, promotion, marketing, distribution, and export.  Prior to commercial sale of a biologic, a Biologics License Application ("BLA") that includes results from required, well-controlled clinical trials to establish the safety and effectiveness for the product's intended use, and specified manufacturing information, must be submitted to and approved by the FDA.  FDA inspection of the manufacturing facility during review of the BLA is required to ensure that manufacturing processes conform to FDA-mandated GMPs.  Continued compliance with GMPs is required after product approval, and post-approval changes in manufacturing processes or facilities, product labeling, or other areas require FDA review and approval.  We are also subject to regulation by the U.S. Department of Health and Human Services, Centers for Disease Control, due to the nature of the biological agent used to manufacture our botulinum toxin product, Clostridium botulinum type A, which is still in the development phase.  Failure to comply with the regulations and requirements of these various agencies could affect our ability to manufacture products and may have a significant negative future impact on sales and results of operations.

We have incurred, and will continue to incur, substantial costs relating to laboratory and clinical testing of new and existing products and the preparation and filing of documents required by the FDA for product approval.  The process of obtaining marketing clearance and approvals from the FDA can be time consuming and expensive, and there is no assurance that such clearances or approvals will be granted.  We also may encounter delays in bringing new products to market as a result of being required by the FDA to conduct and document additional investigations of product safety and effectiveness, which may adversely affect our ability to commercialize additional products or additional applications for existing products.

Additional Regulations

As a manufacturer of medical devices and biologics, our manufacturing processes and facilities are subject to regulation and review by international regulatory agencies for products sold internationally. 

A medical device may only be marketed in the European Union ("EU") if it complies with the Medical Devices Directive (93/42/EEC) ("MDD") and bears the CE mark as evidence of that compliance.  To achieve this, the medical devices in question must meet the "essential requirements" defined under the MDD relating to safety and performance, and we as manufacturer of the devices must undergo verification of our regulatory compliance by a third party standards certification provider, known as a "Notified Body".  We have obtained CE marking for our products sold in the EU by demonstrating compliance with the MDD and ISO13485 2003 international quality system standards.  Medical device laws and regulations are also in effect in some of the other countries to which we export our products.  These range from comprehensive device approval requirements for some or all of our medical device products, to requests for product data or certifications.  Failure to comply with these international regulatory standards and requirements, and to changes in the international quality system standards, could affect our ability to market and sell products in these markets and may have a significant negative impact on sales and results of operations.

Additional products in the area of biologics are being developed, which will be regulated as medicinal products in the EU and as such will require a marketing authorization before they can be introduced into the market.  There are two routes by which this can be achieved: the centralized procedure whereby an approval granted by the European Commission permits the supply of the product in question throughout the EU, or the Mutual Recognition Procedure ("MRP") where a marketing authorization granted by one national authority is recognized by the authorities of the other member states in which we intend to supply the products.  The centralized procedure is compulsory for biotechnology products and is optional for certain high-technology products.  All such products which are not authorized by the centralized route must be authorized by the MRP unless the product is designed for a single EU country, in which case a national application can be made.  In each case, the application must contain full details of the product and the research that has been carried out to establish its efficacy, safety and quality.

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Our present and future business has been and will continue to be subject to various other laws and regulations, including state and local laws relating to such matters as safe working conditions and disposal of potentially hazardous substances.  We may incur significant costs in complying with such laws and regulations now, or in the future, and any failure to comply may have a material adverse impact on our business.

Environmental Regulation

We are subject to federal, state, local and foreign environmental laws and regulations.  Our manufacturing and research and development activities involve the controlled use of potentially hazardous materials, chemicals and biological materials, which require compliance with various laws and regulations regarding the use, storage, and disposal of such materials.  We believe that our operations comply in all material respects with applicable environmental laws and regulations in each country where we have a business presence.  Although we continue to make expenditures for environmental protection, we do not anticipate any additional significant expenditures, in complying with such laws and regulations, that would have a material impact on our earnings or competitive position.  We are not aware of any pending litigation or significant financial obligations arising from current or past environmental practices that are likely to have a material adverse effect on our financial position.  We cannot provide any assurance, however, that environmental claims will not develop in the future including claims for indemnification, relating to our operations or properties owned or operated by us, or those properties previously owned by us and divested as part of the transaction with Coloplast, nor can we predict whether any such claims, if they were to develop, would require significant expenditures on our part.  There can be no assurance that violations of environmental health and safety laws will not occur in the future as a result of the inability to obtain permits, human error, equipment failure or other causes, which could result in fines and penalties or adversely affect our operating results and harm our business. In addition, environmental laws could become more stringent over time, imposing greater compliance costs and increasing risks and penalties associated with violations.

We are subject to regulation by the United States Environmental Protection Agency and other state and local environmental agencies in each of our domestic manufacturing facilities.  For example, in Texas, we are subject to regulation by the local Air Pollution Control District as a result of some of the chemicals used in our manufacturing processes.  Failure to comply with the regulations and requirements of these various agencies could affect our ability to manufacture our existing products or could result in a claim for indemnification and may have a significant negative impact on sales and results of operations, including discontinued operations.

Medicare, Medicaid and Third-Party Reimbursement

Health care providers that purchase medical devices, such as our products, generally rely on third-party payors, including the Medicare and Medicaid programs and private payors, such as indemnity insurers, employer group health insurance programs and managed care plans, to reimburse all or part of the cost of the products.  In the United States, our aesthetics products are sold principally to hospitals, surgery centers and surgeons.  We invoice our customers and they remit directly to us.  In some cases, the patient and the procedure may be eligible for reimbursement by third-party payors, including Medicare, Medicaid and other similar programs, but this coverage is invisible to us on a case-by-case basis.  However, we are aware that some of our customers are being reimbursed, in full or in part, for our products or for procedures that utilize our products.  The majority of procedures that utilize our products are not reimbursable by these third-party payors.   Nevertheless, reimbursement can be a significant market factor when the product cost represents a major portion of the total procedure cost and the reimbursement for that procedure (or alternative procedures) is changing, or influencing treatment decisions.  As a result, demand for our products is dependent in part on the coverage and reimbursement policies of these payors.  The manner in which reimbursement is sought and obtained for any of our products varies based upon the type of payor involved and the setting in which the product is furnished and utilized by patients.

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Payments from Medicare, Medicaid and other third party payors are subject to legislative and regulatory changes and are susceptible to budgetary pressures.  Some of our customers' revenues and ability to purchase our products and services is therefore subject to the effect of those changes and to possible reductions in coverage or payment rates by third-party payors.  Any changes in the health care regulatory, payment or enforcement landscape relative to our customers' health care services may negatively affect our operations and revenues.  Discussed below are certain factors which could have a negative impact on our future operations and financial condition.  It is difficult to predict the effect of these factors on our operations; however, the effect could be negative and material.

Medicare Overview

Medicare is a federal program administered by the Centers for Medicare and Medicaid Services ("CMS"), formerly known as HCFA, through fiscal intermediaries and carriers.  Available to individuals age 65 or over, and certain other classes of individuals, the Medicare program provides, among other things, health care benefits that cover, within prescribed limits, the major costs of most medically necessary care for such individuals, subject to certain deductibles and co-payments.  There are three components to the Medicare program relevant to our business:  Part A, which covers inpatient services, home health care and hospice care; Part B which covers physician services, other health care professional services and outpatient services; and Part C or Medicare Advantage, which is a program for managed care plans. 

The Medicare program has established guidelines for the coverage and reimbursement of certain equipment, supplies and services.  In general, in order to be reimbursed by Medicare, a health care item or service furnished to a Medicare beneficiary must be reasonable and necessary for the diagnosis or treatment of an illness or injury or to improve the functioning of a malformed body part.  The methodology for determining (1) the coverage status of our products; and (2) the amount of Medicare reimbursement for our products, varies based upon, among other factors, the setting in which a Medicare beneficiary received health care items and services.  Any changes in federal legislation, regulations and policy affecting Medicare coverage and reimbursement relative to our products could have a material effect on our performance.

A portion of our revenue is derived from our customers who operate inpatient hospital facilities.  Acute care hospitals are generally reimbursed by Medicare for inpatient operating costs based upon prospectively determined rates.  Under the Prospective Payment System, or PPS, acute care hospitals receive a predetermined payment rate based upon the Diagnosis-Related Group, or DRG, into which each Medicare beneficiary stay is assigned, regardless of the actual cost of the services provided.  Certain additional or "outlier" payments may be made to a hospital for cases involving unusually high costs.  Accordingly, acute care hospitals generally do not receive direct Medicare reimbursement under PPS for the distinct costs incurred in purchasing our products.  Rather, reimbursement for these costs is deemed to be included within the DRG-based payments made to hospitals for the services furnished to Medicare-eligible inpatients in which our products are utilized.  Because PPS payments are based on predetermined rates and are often less than a hospital's actual costs in furnishing care, acute care hospitals have incentives to lower their inpatient operating costs by utilizing equipment, devices and supplies, including those sold by us, that will reduce the length of inpatient stays, decrease labor or otherwise lower their costs.  Our product revenue could be affected negatively if acute care hospitals discontinue product use due to insufficient reimbursement, or if other treatment options are perceived to be more profitable.

Medicare - - Outpatient Hospital Setting

CMS implemented the hospital Outpatient Prospective Payment System, or OPPS, effective July 1, 2000.  OPPS is the current payment methodology for hospital outpatient services, among others.  Services paid under the OPPS are classified into groups called Ambulatory Payment Classifications, or APC.  Services grouped within each APC are similar clinically and in terms of the resources they require.  A payment rate is established for each APC through the application of a conversion factor that CMS updates on an annual basis.  OPPS may cause providers of outpatient services with costs above the payment rate to incur losses on such services provided to Medicare beneficiaries. 

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The Balanced Budget Refinement Act of 1999 provides for temporary financial relief from the effects of OPPS through the payment of additional outlier payments and transitional pass-through payments to outpatient providers reimbursed through OPPS who qualify for such assistance.  Transitional pass-through payments are required for new or innovative medical devices, drugs, and biological agents.  The purpose of transitional pass-through payments is to allow for adequate payment of new and innovative technology until there is enough data to incorporate cost for these items into the base APC group.  The qualification of a device for transitional pass-through payments is temporary. 

Annually CMS proposes, and after consideration of public comment, implements changes to OPPS and payment rates for the following calendar year.  The OPPS methodology determines the amount hospitals will be reimbursed for procedures performed on an outpatient basis and determines the profitability of certain procedures for the hospital and may impact hospital purchasing decisions. 

We cannot predict the final effect that any change in OPPS regulations, including future annual updates, will have on our customers or our revenues.  Any such effect, however, could be negative if APC groupings become less advantageous, reimbursement allowables decline, or if the OPPS is modified in any other manner detrimental to our business.

Medicaid

The Medicaid program is a cooperative federal/state program that provides medical assistance benefits to qualifying low income and medically needy persons.  State participation in Medicaid is optional and each state is given discretion in developing and administering its own Medicaid program, subject to certain federal requirements pertaining to payment levels, eligibility criteria and minimum categories of services.  The coverage, method and level of reimbursement varies from state to state and is subject to each state's budget restraints.  Changes to the coverage, method or level of reimbursement for our products may affect future revenue negatively if reimbursement amounts are decreased or discontinued.

Private Payors

Many third-party private payors, including indemnity insurers, employer group health insurance programs and managed care plans, presently provide coverage for the purchase of our products.  The scope of coverage and payment policies varies among third-party private payors.  Furthermore, many such payors are investigating or implementing methods for reducing health care costs, such as the establishment of capitated or prospective payment systems.  Cost containment pressures have led to an increased emphasis on the use of cost-effective technologies and products by health care providers.  Future changes in reimbursement methods and cost control strategies may limit or discontinue reimbursement for our products and could have a negative effect on revenues and results of operations.

Health Care Fraud and Abuse Laws and Regulations

The federal government has made a policy decision to significantly increase the financial resources allocated to enforcing the health care fraud and abuse laws.  Private insurers and various state enforcement agencies also have increased their level of scrutiny of health care claims and arrangements in an effort to identify and prosecute fraudulent and abusive practices in the health care industry.  We monitor compliance with federal and state laws and regulations applicable to the health care industry in order to minimize the likelihood that we would engage in conduct or enter into contracts that could be deemed to be in violation of the fraud and abuse laws.  The health care fraud and abuse laws to which we are subject include the following, among others:

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Federal and State Anti-Kickback Laws and Safe Harbor Provisions

The federal anti-kickback laws make it a felony to knowingly and willfully offer, pay, solicit or receive any form of remuneration in exchange for referring, recommending, arranging, purchasing, leasing or ordering items or services covered by a federal health care program, including Medicare or Medicaid, subject to various "safe harbor" provisions.  The anti-kickback prohibitions apply regardless of whether the remuneration is provided directly or indirectly, in cash or in kind, and various state laws have similar prohibitions that are sometimes broader in nature.  Interpretations of the law have been very broad.  Under current law, courts and federal regulatory authorities have stated that the federal law is violated if even one purpose (as opposed to the sole or primary purpose) of the arrangement is to induce referrals.  A violation of the federal statute is a felony and could result in civil and administrative penalties, including exclusion from the Medicare or Medicaid program, even if no criminal prosecution is initiated.

The Department of Health and Human Services has issued regulations from time to time setting forth safe harbors, which would guarantee protection of certain limited types of arrangements from prosecution under the statute if all elements of a particular safe harbor are met.  However, failure to fall within a safe harbor or within each element of a particular safe harbor does not mean that an arrangement is per se in violation of the federal anti-kickback laws.  As the comments to the safe harbors indicate, the purpose of the safe harbors is not to describe all illegal conduct, but to set forth standards for certain non-violative arrangements.  If an arrangement violates the federal anti-kickback laws and full compliance with a safe harbor cannot be achieved, we risk greater scrutiny by the Office of the Inspector General, ("OIG"), and, potentially, civil and/or criminal sanctions.  We believe our arrangements are in compliance with the federal anti-kickback laws, and analogous state laws; however, regulatory or enforcement authorities may take a contrary position, and we cannot assure that these laws will ultimately be interpreted in a manner consistent with our practices.

Federal False Claims Act 

We are subject to state and federal laws that govern the submission of claims for reimbursement.  The federal False Claims Act imposes civil liability on individuals or entities that submit (or "cause" to be submitted) false or fraudulent claims to the government for payment.  Violations of the False Claims Act may result in civil monetary penalties for each false claim submitted treble damages and exclusion from the Medicare and Medicaid programs.  In addition, we could be subject to criminal penalties under a variety of federal statutes to the extent that we knowingly violate legal requirements under federal health programs or otherwise present (or cause to be presented) false or fraudulent claims or documentation to the government.  In addition, the OIG may impose extensive and costly corporate integrity requirements upon a health industry participant that is the subject of a false claims judgment or settlement.  These requirements may include the creation of a formal compliance program, the appointment of a government monitor, and the imposition of annual reporting requirements and audits conducted by an independent review organization to monitor compliance with the terms of any such compliance program, as well as the relevant laws and regulations. 

The False Claims Act also allows a private individual to bring a "qui tam" suit on behalf of the government for violations of the False Claims Act, and if successful, the "qui tam" individual shares in the government's recovery.  A qui tam suit may be brought, with only a few exceptions, by any private citizen who has material information of a false claim that has not yet been previously disclosed.  Recently, the number of qui tam suits brought in the health care industry has increased dramatically.  In addition, several states have enacted laws modeled after the False Claims Act.

Under the Deficit Reduction Act of 2005, Congress encouraged states to enact state false claims acts that are similar to the federal False Claims Act, including "qui tam" provisions.  As states enact such laws, the risk of being subject to a state false claims action will increase.

Additionally, the U.S. Foreign Corrupt Practices Act, to which we are subject, prohibits corporations and individuals from engaging in certain activities to obtain or retain business or to influence a person working in an official capacity.  It is illegal to pay, offer to pay, authorize to payment of anything of value to any foreign government official, government staff member, political party, or political candidate in an attempt to obtain or retain business or to otherwise influence a person working in an official capacity.  Our present and future business has been and will continue to be subject to various other laws, rules, and/or regulations.

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Product Development

We are focused on the development of new products and improvements to existing products, as well as obtaining FDA approval of certain products and processes, and we maintain the highest quality standards of existing products.  During fiscal years 2006, 2005 and 2004, we spent a total of $29.0 million, $25.2 million and $ 21.1 million, respectively, for research and development primarily in support of our silicone gel breast implant regulatory submissions in the United States and Canada, laboratory testing and clinical studies for our hyaluronic acid-based dermal filler Puragen™ and our botulinum toxin products.

Patents and Licenses

It is our policy to protect our intellectual property rights relating to our products whenever possible and appropriate.  Our patents and licenses relating to continuing operations include those relating to tissue expanders, a combination breast implant and tissue expander (Becker implant), and body contouring (liposuction) equipment.  We believe that although our patents and licenses are material in their totality, no single patent or license is material to our business as a whole.

In those instances where we have acquired technology from third parties, we have sought to obtain rights of ownership to the technology through the acquisition of underlying patents or licenses.  While we believe design, development, regulatory and marketing aspects of the medical device business represent the principal barriers to entry into such business, we also recognize that our patents and license rights may make it more difficult for our competitors to market products similar to those we produce.  We can give no assurance that our patent rights, whether issued, subject to license, or in process, will not be circumvented, terminated, or invalidated.  Further, there are numerous existing and pending patents on medical products and biomaterials.  We can give no assurance that our current, former or planned products do not or will not infringe such rights or that others will not claim such infringement or that we will be able to prevent competitors from challenging our patents or entering markets currently served by us.

Raw Material Supply and Single Source Suppliers

We obtain certain raw materials and components for a number of our products from single source suppliers, including our implant quality silicone elastomers and gel materials for mammary prostheses and certain components used for those prostheses.  We believe our sources of supply could be replaced if necessary, but it is possible that the process of qualifying new materials and/or vendors for certain raw materials and components could cause an interruption in our ability to manufacture our products and potentially have a material negative impact on sales.  No significant interruptions to raw material supplies occurred during fiscal 2006.

Our saline-filled mammary implants and other products are available for sale in the United States under FDA approvals and/or clearances.  Gel-filled mammary implants are only available in the United States as part of the adjunct clinical study.  A change in raw material, components or suppliers for products may require a new FDA submission, and subsequent review and approval.  There is no assurance that such a submission would be approved without delay, or at all.  Any delay or failure to obtain approval may have a significant adverse impact on our sales and results of operations. 

In connection with the sale of our Urology Business to Coloplast, we have entered into a supply agreement with Coloplast for certain components of our breast implant products.  For the short-term, Coloplast would be our sole source for these components, and if we were unable to obtain this supply, our business would be harmed.  We may determine that we do not want to continue to purchase products from Coloplast or Coloplast may be unable to meet our needs in a timely manner, either of which may disrupt our business during the period we negotiate a supply agreement with, and qualify the manufacturing process of, a third party or begin production of the components ourselves.    

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Seasonality

Our quarterly results reflect slight seasonality, as the second fiscal quarter ending September 30 tends to have the lowest revenue of all of the quarters.  This is primarily due to lower levels of sales of breast implants for augmentation, an elective procedure, as surgeons and patients tend to take vacation, particularly in Europe, during this quarter.

Working Capital

We maintain normal industry levels of inventory for our business.  This includes significant consignment inventories of our aesthetics products to aid the surgeon in correctly sizing an implant to meet patient needs and to reduce the rate of returns of products that are purchased in order to facilitate sizing options.  Inventories are managed to levels consistent with high levels of customer service.  Additionally, new product introductions require inventory build-ups to ensure success.

Our accounts receivable credit terms are consistent with normal industry practices in the markets that we sell our products.  Aesthetic surgery product return policies allow for product returns for full or partial credit for up to six months.  It is common practice to order additional quantities and sizes to facilitate correct sizing to meet patient needs.  Consequently, product return rates are high but are considered to be consistent with the industry rates.  See "Application of Critical Accounting Policies - Revenue Recognition" of "Management's Discussion and Analysis of Financial Condition and Results of Operations."

Employees

As of March 31, 2006, we employed approximately 950 people in our continuing operations, of whom 490 were in manufacturing, 202 in sales and marketing, 82 in research and development and 176 in finance and administration.  Including the discontinued operations (surgical urology and clinical and consumer healthcare segments), at March 31, 2006, we employed a total of approximately 2,040 people, of whom 1,075 were in manufacturing, 525 in sales and marketing, 123 in research and development and 317 in finance and administration.  We have never had a work stoppage due to labor difficulties, and we consider our relations with our employees to be satisfactory.

Discontinued Operations 

On May 17, 2006, we entered into a definitive Purchase Agreement with Coloplast for the sale of our surgical urology and clinical and consumer healthcare business segments for total consideration of $463,225,000, of which $456,137,500 is in cash and $7,087,500 in non-cash consideration consisting of the value of certain foreign tax credits that Mentor expects to realize arising from the transaction prior to the close.  On June 2, 2006, we completed this sale to Coloplast.  The Purchase Agreement provides, among other things, that we will not enter into or engage in a business that competes with the business as sold, on a worldwide basis, for a period of seven years following the closing.  This restriction on competition does not apply to (i) development, manufacture or sale of any oral pharmaceuticals or any product or treatments involving dermal fillers or other bulking agents or toxins, including botulinum toxins, or (ii) any businesses acquired and operated by us or our affiliates for so long as such competing businesses generate less than $5 million in aggregate annual revenues.  These restrictions on competition terminate upon a change in control of Mentor.  On June 1, 2006, our Porges SAS subsidiary sold certain intellectual property to Coloplast for $52 million which is included in the total consideration.  In connection with the sale, we entered into a Transition Services Agreement ("TSA") and various supply agreements.  Pursuant to the TSA, in exchange for specified fees, we will provide to Coloplast, and Coloplast will provide to us, services including accounting, regulatory, clinical, information technology, customer support and use of facilities.  Under the supply agreements, we will supply various products, including silicone gel-filled testicular implants to Coloplast and Coloplast will supply to us various component products to us.  Coloplast will reimburse us for certain fees and expenses related to the services we perform under the TSA.  Certain of these services that we will provide are expected to extend for a period of up to 12 months, and the supply agreements range from a period of 6 - 36 months.  On June 2, 2006, we also completed the sale of our intellectual property, raw materials and tangible assets for the production of silicone male external catheters relating to our catheter production facility in Anoka, Minnesota and our inventory of such catheters to Rochester Medical Corporation, for an aggregate purchase price of approximately $1.6 million. 

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Our former surgical urology segment included surgically implantable prostheses for the treatment of impotence, surgically implantable incontinence products, urinary care products, and brachytherapy seeds for the treatment of prostate cancer.  Our former clinical and consumer healthcare products included catheters and other products for the management of urinary incontinence and retention.  The surgical urology and clinical and consumer healthcare segments sold to Coloplast contributed approximately 47% of our pre-divestiture consolidated net sales and approximately 27% of our operating profit in fiscal 2006.  Net assets held for sale comprised approximately 51% of  total pre-divestiture net assets in fiscal 2006.

Executive Officers of the Registrant

Our executive officers as of June 11, 2006 are listed below, followed by brief accounts of their business experience and certain pertinent information as of that date.

Name	Age	Position
Joshua H. Levine	47	President and Chief Executive Officer
Loren L. McFarland	47	Vice President, Chief Financial Officer and Treasurer
David J. Adornetto	44	Vice President, Operations
Kathleen M. Beauchamp	41	Vice President, Sales and Marketing
A. Christopher Fawzy	36	Vice President, General Counsel and Secretary

Joshua H. Levine has served as the President and Chief Executive Officer and a director since May 2004.  He was President and Chief Operating Officer from December 2003 to May 2004, Senior Vice President, Global Sales and Marketing from June 2002 to December 2003, Vice President Domestic Sales and Marketing for Aesthetic Products from September 2000 to June 2002, assuming global responsibilities for all of aesthetic sales and marketing activities in November 2001.  He joined us as Vice President, Sales, Aesthetic Products from October 1996 to September 1998.  During his early tenure with us, Mr. Levine resigned his position as Vice President, Sales and Marketing, Aesthetics Products which he held from September 1998 to January 2000, to join a start-up practice management organization, The Plastic Surgery Company, where he was Chief Development Officer until his resignation in September 2000.  (More than a year after his resignation, in March 2002, The Plastic Surgery Company filed a voluntary petition in bankruptcy under Chapter 11 of the U.S. Bankruptcy Code.)  Prior to his employment with us, Mr. Levine was employed by Kinetics Concepts, Inc., a specialty medical equipment manufacturer, in a variety of executive level sales and marketing positions, ultimately serving as Vice President and General Manager of KCI Home Health Care Division from 1989 to 1996.  Mr. Levine earned his bachelor's degree in Communications from University of Arizona, Tucson.

Loren L. McFarland has served as Chief Financial Officer and Treasurer since May 2004.  He was Vice President of Finance and Corporate Controller from 2001 to May 2004, Controller from 1989 to 2001, Assistant Controller from 1987 to 1989 and General Accounting Manager from 1985 to 1987.  Prior to his employment with us, Mr. McFarland was employed by Touche Ross and Co., a public accounting firm, as a Certified Public Accountant and auditor from 1981 to 1985.  Mr. McFarland earned his bachelor's degree in Business Administration and Accounting from the University of North Dakota and a master's degree in Business Administration from the University of California at Los Angeles.

David J. Adornetto has served as Vice President, Operations since December 2003.  He was Corporate Vice President of Strategic Planning and Operational Development from August 2002 to December 2003, Vice President Finance for the Company's subsidiary, Mentor Medical Inc. from May 1999 to August 2002, Director of Finance for the Company's Manufacturing Operations Division from May 1997 to May 1999 and has held various other management positions since joining us in 1992.  Prior to his employment with us, Mr. Adornetto was employed by Deloitte & Touche as a senior auditor.  He is a Certified Public Accountant and earned his master's degree in Business Administration from the University of California at Los Angeles. 

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Kathleen M. Beauchamp has served as Vice President Sales & Marketing since December 2003 and as an officer since July 2004.  She was Vice President of Aesthetic Sales between April 2002 and December 2003, and Director of Sales, Domestic Aesthetics from January 2000 to April 2002.  Ms. Beauchamp has served as an Aesthetics sales representative, National Sales Trainer, Regional Manager, and National Sales Manager since her employment with us in May 1993, and has 20 years of experience in the healthcare industry, including pharmaceutical and biotechnology.  Ms. Beauchamp is a graduate of Santa Clara University.

A. Christopher Fawzy has served as Vice President, General Counsel, and Secretary since October 2005.  He was promoted to General Counsel in December 2003 and appointed to the office of Secretary in July 2004.  He was Corporate Counsel, responsible for all legal functions of the Company from February 2002 to December 2003, and a Staff Attorney, responsible for the Company's contractual arrangements, commercial and product litigation, and general legal compliance from January 2001 to February 2002.  Prior to his employment with us, Mr. Fawzy practiced law at Casey & Brannen, P.C., an Illinois-based law firm, where he focused on commercial and civil litigation.  He earned his bachelor's degree in Economics from the University of Illinois, and his Doctorate of Jurisprudence from Northern Illinois University College of Law.  Mr. Fawzy is a member of the State Bar of Illinois and is a Registered In-House Counsel member of the State Bar of California.

Available Information

We file with the Securities and Exchange Commission ("SEC") our annual report on Form 10‑K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports, proxy statements and registration statements.  The public may read and copy any material we file with the SEC at the SEC's Public Reference Room at 100 F. Street, N.E., Room 1580, Washington, D.C.  20549.  The public may also obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.  In addition, the SEC maintains its Internet site at http://www.sec.gov that contains reports, proxy and information statements and other information regarding registrants, including us, that file electronically.

Our primary web site is http://www.mentorcorp.com.  We make available free of charge, on or through this web site, our annual, quarterly and current reports and any amendments to those reports, as soon as reasonably practicable after electronically filing such reports with the SEC.  In addition, copies of the written charters for the committees of our Board of Directors, our Corporate Governance Guidelines, our Code of Ethics for Senior Financial Officers, and our Code of Business Conduct and Ethics are also available on this web site, and can be found under the Investor Relations and Corporate Governance links.  Copies are also available in print, free of charge, by writing to Mentor Corporation, 201 Mentor Drive, Santa Barbara, CA  93111, Attn:  Investor Relations.  We may post amendments or wavers about our Code of Ethics for Senior Financial Officers and Code of Business Conduct and Ethics, if any, on our web site.  This web site address is intended to be an inactive textual reference only, and none of the information contained on our web site is part of this report or is incorporated in this report by reference.

Forward-Looking Information Under the Private Securities Litigation Reform Action of 1995

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements.  The Act was designed to encourage companies to provide prospective information about them without fear of litigation.  The prospective information must be identified as forward-looking and must be accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected in the statements.  The statements about our business, plans, strategies, intentions, expectations and prospects contained throughout this document are based on current expectations.  These statements are forward-looking and actual results may differ materially from those predicted as of the date of this report in the forward-looking statements, which involve risks and uncertainties.  In addition, past financial performance is not necessarily a reliable indicator of future performance and investors should not use historical performance to anticipate results or future period trends.  We undertake no obligation to revise or update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

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ITEM 1A.    RISK FACTORS.

Our business faces many risks.  The risks described below may not be the only risks we face.  Additional risks that we do not yet know of or that we currently think are immaterial may also impair our business operations.  If any of the events or circumstances described in the following risks actually occurs, our business, financial condition or results of operations could suffer and the trading price of our common stock or our convertible notes could decline. You should consider the following risks before deciding to invest in our common stock or convertible notes.

Significant product liability claims or product recalls may force us to pay substantial damage awards and other expenses that could exceed our accruals and insurance coverages.

The manufacture and sale of medical devices exposes us to significant risk of product liability claims.  In the past, and currently, we have had a number of product liability claims relating to our products, and we may be subject to additional product liability claims in the future, some of which may have a negative impact on our business.  If a product liability claim or series of claims is brought against us for uninsured liabilities or in excess of our insurance coverage, our business could suffer.  Some manufacturers that suffered such claims in the past have been forced to cease operations or even to declare bankruptcy.

Additionally, we offer product replacement and certain financial assistance for surgical procedures that fall within our limited warranty and coverage period of implantation on our breast implant products, and we accrue for those limited warranties.  Such accruals are based on estimates, taking into consideration relevant factors such as historical experience, warranty period, estimated costs, existence and levels of insurance and insurance retentions, identified product quality issues, if any, and, to a limited extent, information developed by the insurance company using actuarial techniques.  We assess the adequacy of these accruals periodically and adjust the amounts as necessary based on actual experience and changes in future expectations.  We also recently expanded our limited warranty programs to provide certain financial assistance for surgical procedures within ten years of implantation (increased from five years) and expanded the program coverage to include breast implant sales in European and certain other countries, in addition to the United States.  Changes to actual warranty claims incurred could have a material impact on the actuarial analysis, which in turn could materially impact our reported expenses and results of operations.

In addition to product liability or warranty claims, we could experience a material design or manufacturing failure, a quality system failure, other safety issues, or heightened regulatory scrutiny that would warrant a recall of products we manufacture or are manufactured by another company and we distribute.  A recall of some of our products could result in exposure to additional product liability claims, significant expense to perform the recall and lost sales.

We are subject to substantial government regulation, which could have a material adverse affect on our business.

The production and marketing of our products and our ongoing research and development activities, including pre-clinical testing and clinical trial activities, are subject to extensive regulation and review by numerous governmental authorities both in the U.S. and abroad.  Most of the medical devices we develop must undergo rigorous pre-clinical and clinical testing and an extensive regulatory approval process before they can be marketed.  Certain of our products are required to undergo review by a panel of outside experts selected by the FDA, which makes a recommendation to the FDA as to whether the product(s) should or should not be approved.  This process makes it potentially longer, more difficult and/or more costly to bring our products to market, and we cannot guarantee that any of our unapproved products will be approved or how long it may take for any one particular product to be approved.  The pre-marketing approval process can be particularly expensive, uncertain and lengthy, and a number of devices for which FDA approval has been sought by other companies have never been approved for marketing.  In addition to testing and approval procedures, extensive regulations also govern manufacturing, packaging, labeling, storage, distribution, record-keeping, advertising, and marketing procedures.  If we do not comply with applicable regulatory requirements, such violations could result in non-approval, suspensions of clinical trials, suspension or withdrawal of regulatory approvals, product recalls, civil penalties and criminal fines, product seizures, operating restrictions, injunctions, and criminal prosecution.

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Delays in, withdrawal, or rejection of the FDA or other government entity approval(s) of our products, including a delay in or rejection of the approval of our round silicone gel-filled breast implant pre-market approval application ("PMA") or a significant delay in acceptance of the clinical module of our Contour Profile Gel PMA, or any significant delays in our PMA filings, including our Puragen Plus^™ PMA, may also adversely affect our business.  Such delays, withdrawals, or rejections may be encountered due to, among other reasons, government or regulatory delays, lack of demonstrated safety or efficacy during clinical trials, safety issues, manufacturing issues, slower than expected rate of patient recruitment for clinical trials, inability to follow patients after treatment in clinical trials, inconsistencies between early clinical trial results and results obtained in later clinical trials, varying interpretations of data generated by clinical trials, or changes in regulatory policy or requirements in the U.S. and abroad.  In the U.S., there has been a continuing trend toward more stringent FDA requirements in the areas of product approval and enforcement, causing medical device manufacturers to experience longer research and development timelines, longer approval cycles, greater risk and uncertainty, and higher expenses.  Internationally, there is a risk that we may not be successful in meeting the quality standards or other certification requirements.  Even if regulatory approval of a product is granted, such approval may entail limitations on uses for which the product may be labeled and promoted, stringent post-marketing requirements, or may prevent us from broadening the uses of our current products for different applications.  If we incur significant expenses, for example, in connection with post-market patient monitoring and data collection activities for our silicone gel-filled breast implants, this could have a material adverse effect on our results of operations.  In addition, to the extent permissible by law, we may not receive FDA approval to export our products in the future, and countries to which products are to be exported may not approve them for import.  We may also be required to withdraw or recall our products after we receive approvals and begin commercial sales if we, the FDA or a foreign government agency determines that there is a higher than average incidence of post-treatment complications with our products as a result of subsequent clinical experience and/or data.  From time to time, we are subject to inquiry by government agencies in this regard. 

Our manufacturing facilities also are subject to continual governmental review and inspection.  The FDA has stated publicly that compliance with manufacturing regulations will be scrutinized more strictly.  A governmental authority may challenge our compliance with applicable federal, state and/or foreign regulations.  In addition, any discovery of previously unknown problems with one of our products or facilities may result in restrictions on the product or the facility, including, but not limited to, product recalls, withdrawal of the product from the market or other enforcement actions.

From time to time, legislative or regulatory proposals are introduced that, if implemented, could alter the review and approval process relating to medical devices, or related to the sale of our products.  It is possible that the FDA or other governmental authorities will issue additional regulations, which could further reduce or restrict the sales of our presently marketed products or products under development.

Any change in legislation or regulations that govern the review and approval process relating to our current and/or future products, or that restrict the manner by which we may sell our products, could make it more difficult and/or costly to obtain approval for new products, and/or to produce, market, and distribute existing products.

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If we are unable to continue to develop and commercialize new technologies and products, we may experience a decrease in demand for our products or our products could become obsolete.

The medical device industry is highly competitive and is subject to significant and rapid technological change.  We believe that our ability to develop or acquire new technologies is crucial to our success.  We are continually engaged in product research and development, product improvement programs, and required clinical studies to develop new technologies and to maintain and improve our competitive position.  Any significant delays in the above or termination or failure of our clinical trials would materially and adversely affect our research, development and commercialization timelines.  We cannot guarantee that we will be successful in enhancing existing products, or in developing or acquiring new products or technologies that will timely achieve regulatory approval or success in the marketplace.  

There is also a risk that our products may not gain market acceptance among physicians, patients and the medical community generally.  The degree of market acceptance of any medical device or other product that we develop will depend on a number of factors, including demonstrated clinical safety and efficacy, cost-effectiveness, potential advantages over alternative products, user/patient acceptance, and our marketing and distribution capabilities.  Physicians will not recommend our products if clinical and/or other data and/or other factors do not demonstrate their safety and efficacy compared to other competing products, or if our products do not best meet the particular needs of the individual patient.

In December 2003, we completed our PMA application to the FDA for our silicone gel-filled implants for breast augmentation, reconstruction and revision.  In August 2004, we amended our PMA application based on a revised draft guidance released by the FDA in January 2004.  On July 28, 2005, we received an "approvable" letter, with conditions, from the FDA on our PMA application for our silicone gel-filled breast implants.  The approvable letter stipulates a number of conditions which we must satisfy in order to receive FDA approval to market and sell silicone gel-filled breast implants in the United States.  Our current discussions with FDA regarding our MemoryGel^™ silicone gel-filled breast implant PMA are primarily focused on post-approval patient monitoring and data collection.  Despite the approvable letter and our current discussions, the FDA may ultimately decide to not approve our silicone gel-filled breast implants for sale in the United States, or if they do approve, the FDA would most likely recommend additional post-approval conditions or requirements, for which we would incur costs that could be substantial, and which could potentially impact our sales and earnings, depending on the scope and complexity of the requirements.  Further change in FDA regulatory requirements, including those implemented through new or revised FDA guidance, (such as that announced on January 8, 2004 by the FDA), may delay or may otherwise adversely affect our pending PMA application as well as its review or approval by the FDA.  A delay or denial response by the FDA would have a material adverse effect on our commercialization timelines and competitive position, and ultimately our revenue and operating results.  If our new products do not achieve significant market acceptance, or if our current products do not continue competing successfully in the changing market, our sales and earnings may not grow as much as expected, or may even decline.

We also have two pending applications for Medical Device Licenses in Canada for our silicone gel-filled breast implants.  An expert advisory panel was convened by the Canadian government on March 22, 2005 to review our pending application for Medical Device Licenses.  A public forum called by Health Canada on these devices was held September 29, 2005.  We cannot predict the outcome of these reviews, nor determine when or if Health Canada will approve our product applications.  In addition, any approval could be granted with stringent post-approval conditions or requirements, for which we would incur costs, and which could impact our sales and earnings, depending on the scope and complexity of such requirements.

With respect to our Puragen Plus™ program in the U.S., we recently identified potential issues that required further evaluation of our clinical study data  that will result in a delay to our PMA submission timeline.  We performed this further evaluation, and we concurrently reviewed some of our critical production processes.  Though we have developed a plan to move forward with our Puragen Plus^™ PMA process, any further delays in the submission of our PMA or a delay or denial response by the FDA would have a material adverse effect on our commercialization timelines and competitive position, and ultimately our future revenue and operating results. 

21

If we are unable to compete effectively with existing or new competitors, we could experience price reductions, reduced demand for our products, reduced margins and loss of market share, and our business, results of operations and financial condition would be adversely affected.

Our products compete with similar or other competitive medical products manufactured by major companies, and may also compete with new products currently under development by others. 

Competition in our industry occurs on a variety of levels, including but not limited to:

•          developing and bringing new products to market before others or to provide benefits superior to those of existing products;

•          developing new technologies to improve existing products;

•          developing new products at a lower cost to provide the same benefits as existing products at the same or lower price;

•          creating or entering new markets with existing products;

•          increasing or improving service-related programs; and

•          advertising in a manner that creates additional awareness and demand.

The competitive environment requires an ongoing, extensive search for technological innovations and the ability to market products effectively.  Consequently, we must continue to effectively execute on various competitive levels to properly position our products in the marketplace and maintain our market share, revenue and gross margins.

In particular, we face competition from Allergan, Inc., which acquired Inamed Corporation in March 2006, our only current competitor in the U.S. for our breast aesthetics product line.  On September 21, 2005, Inamed announced that it also received an "approvable" letter, with conditions, from the FDA for its silicone gel-filled breast implants.  If Allergan gains FDA approval to market its silicone gel-filled breast implant products before we do, our competitive position will likely suffer.  As a result of Allergan's acquisition of Inamed,  we are now competing against a much larger competitor with a substantially larger sales force.

If we suffer negative publicity concerning the safety of our products, our sales may be harmed and we may be forced to withdraw products.

Physicians and potential patients may have a number of concerns about the safety of our products, including our breast implants, whether or not such concerns have a basis in generally accepted science or peer-reviewed scientific research.  Negative publicity, whether accurate or inaccurate, concerning our products could reduce market or governmental acceptance of our products and could result in decreased product demand or product withdrawal.  For example, we may be required to recall or withdraw our products if we, the FDA or a foreign government agency determine that use of our products results in a higher than average rate of post-treatment complications based on clinical experience and/or data.  If one foreign government agency were to request or require a withdrawal or recall of one or more of our products, the safety concerns leading to that government agency's request may be investigated by regulatory bodies in other countries, which could result in additional withdrawals or recalls and could result in negative publicity regarding our products.  In addition, significant negative publicity could result in an increased number of product liability claims, whether or not these claims are supported by applicable law.

If changes in the economy and consumer spending reduce consumer demand for our products, our sales and profitability could suffer.

Certain elective procedures, such as breast augmentation and body contouring, are not covered by insurance.  Adverse changes in the economy or other conditions or events may cause consumers to reassess their spending choices and reduce the demand for these surgeries and could have an adverse effect on consumer spending.  This shift could have an adverse effect on our sales and profitability.

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If we are unable to implement new information technology systems, our ability to manufacture and sell products, maintain regulatory compliance and manage and report our business activities may be impaired, delayed or diminished, which would cause substantial business interruption and loss of sales, customers and profits.

In fiscal 2004, we implemented an enterprise resource planning system at our major locations which is our primary business management system.  We intend to continue to implement the system for substantially all of our businesses worldwide.  Many other companies have had severe problems with computer system implementations of this nature and scope.  We are using a controlled project plan and we believe we have assigned adequate staffing and other resources to the projects to ensure its successful implementation; however there is no assurance that the design will meet our current and future business needs or that it will operate as designed.  We are heavily dependent on such computer systems, and any failure or delay in the system implementation would cause a substantial interruption to our business, additional expense, and loss of sales, customers, and profits.

If we are unable to acquire companies, businesses or technologies as part of our growth strategy or to successfully integrate past acquisitions, our growth, sales and profitability could suffer.

A significant portion of our recent growth has been the result of acquisitions of other companies, businesses and technologies.  In October 2005, we announced our intention to refocus our business solely on aesthetic medicine and we sold our surgical urology and clinical and consumer health businesses in June 2006.  This refocus consumed a significant amount of management attention and may have distracted and may continue to distract us from pursuing acquisition opportunities in the short term.  We intend to continue to acquire other businesses and technologies to facilitate our future business strategies.  There can be no assurance that we will be able to identify appropriate acquisition candidates, consummate transactions or obtain agreements with terms favorable to us.  For example, in November 2005, we made an unsolicited offer to acquire Medicis, Inc. (which was at the time subject to an acquisition agreement with Inamed) that was rejected.  We may incur substantial expenses in connection with our acquisition activities, even if the transaction is not completed, such as the approximately $3.4 million in expenses incurred related to the offer to acquire Medicis.  Once a business is acquired, any inability to integrate the business, failure to retain and develop its workforce, or establish and maintain appropriate communications, performance expectations, regulatory compliance procedures, accounting controls, and reporting procedures could adversely affect our future sales and earnings.

We may suffer from disruptions to our business and information technology systems and be unable to retain employees as a result of the June 2006 sale of our Urology Business to Coloplast.

In October 2005, we announced our intention to refocus our business solely on aesthetic medicine, and we completed the sale of our surgical urology and clinical and consumer health businesses to Coloplast in June 2006.  As a result of the transition of employees, information technology services, facilities and customers to Coloplast, our business may be disrupted.  For example, we may experience difficulty with our enterprise resource planning system due to the separation of the Urology Business segment from our existing system. 

We are obligated to provide specified transition services to Coloplast and our ability to complete our own planned projects may suffer if the resource requirements for providing those services exceeds our expectations.

We are obligated to provide a variety of transition services to Coloplast in connection  with their acquisition of our Urology Business for up to 12 months.  The demands on us associated with providing these services may outpace our expectations and we may be obligated to devote more resources than we expect to provide the services, and may divert management's attention. 

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We agreed to indemnify Coloplast against specified losses in connection with Coloplast's purchase of our Urology Business and any demands for indemnification may result in expenses we do not anticipate and distract the attention of our management from our continuing businesses.

We have agreed to indemnify Coloplast against specified losses in connection with the June 2006 sale of our Urology Business and generally retain responsibility for various legal liabilities that accrue prior to closing.  We also made representations and warranties to Coloplast about the condition of our Urology Business, including matters relating to intellectual property, regulatory compliance and environmental laws.  If Coloplast makes an indemnification claim because it has suffered a loss or a third party has commenced an action against Coloplast, we may incur substantial expenses resolving Coloplast's claim or defending Coloplast and ourselves against the third party action, which would harm our operating results.  In addition, our ability to defend ourselves may be impaired because our former Urology Business employees are now employees of Coloplast and our management may have to devote a substantial amount of time to resolving the claim, and, as we are no longer in the Urology Business, will not be able to readily offer products, service and intellectual property in settlement.  In addition, these indemnity claims may divert management attention from aesthetics business.  It may also be difficult to determine whether a claim from a third party stemmed from actions taken by us or Coloplast and we may expend substantial resources trying to determine which party has responsibility for the claim.

We may not realize some of the benefits of the Coloplast transaction.

We anticipate that we will be able to utilize approximately $7.9 million of foreign tax credits resulting from the Coloplast transaction.  While Coloplast has agreed to indemnify us for the availability of up to $7.1 million of these tax credits, we cannot be sure that we will be able to utilize those tax credits before they expire due to any number of factors including, but not limited to, whether the credits expire due to changes in ownership in excess of the applicable tax rules, sufficient income in the jurisdictions in which we have the credits and other possible reasons the tax credits might be disallowed.  Although Coloplast has agreed to indemnify Mentor for $7.1 million of the foreign tax credits, if the foreign tax credits are disallowed and we are not able to recover from Coloplast, we may not be able to realize the full amount, or any, of those tax credits.

We may not be successful in transitioning our business to focus solely on aesthetic medicine, which may harm our prospects and operating results.

As of June 2006, we completed the divestiture of our Urology Business, and our continuing business is now focused on aesthetic medicine.  We may not successfully improve our operating margins despite the divestiture of our Urology Business to be consistent with those of competitive companies focused solely on aesthetic medicine.  In addition, we may be unsuccessful at broadening the focus of our sales force to physicians practicing aesthetic medicine other than plastic surgeons.  In order to successfully increase our sales presence to those physicians, we will be required to develop internally or purchase additional products that will meet the needs of those physicians and obtain regulatory approval to sell those products.  For example, we have announced a delay in the anticipated date for submission of our Puragen Plus^™ products to the FDA, which product would be marketed to dermatologists as well as plastic surgeons.

State legislatures and taxing authorities may create new laws or change their interpretation of existing state and local tax laws that may affect future product demand or create unforeseen tax liabilities.

If any state legislature or other government authority creates new laws to assess sales taxes on medical procedures determined by them to be cosmetic, our physician and patient customers may have to pay more for our products and future demand may decrease.  In addition, if taxing authorities determine that our products are cosmetic and thus taxable based on their interpretations of existing tax laws or that our products are otherwise taxable, they may disallow currently available exemptions related to medical products and procedures.  Such taxing authorities may then determine that we owe additional taxes related to product sales from prior periods.  These determinations would have a negative effect on our results of operations.

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If our intellectual property rights do not adequately protect our products or technologies, others could compete against us more directly, which would hurt our profitability.

Our success depends in part on our ability to obtain patents or rights to patents, protect trade secrets, operate without infringing upon the proprietary rights of others, and prevent others from infringing on our patents, trademarks and other intellectual property rights.  We will be able to protect our intellectual property from unauthorized use by third parties only to the extent that it is covered by valid and enforceable patents, trademarks or licenses.  Patent protection generally involves complex legal and factual questions and, therefore, enforceability of patent rights cannot be predicted with certainty; thus, any patents that we own or license from others may not provide us with adequate protection against competitors.  Moreover, the laws of certain foreign countries do not recognize intellectual property rights or protect them to the same extent as do the laws of the United States. 

In addition to patents and trademarks, we rely on trade secrets and proprietary know-how.  We seek protection of these rights, in part, through confidentiality and proprietary information agreements.  These agreements may not provide sufficient protection or adequate remedies for violation of our rights in the event of unauthorized use or disclosure of confidential and proprietary information.  Failure to protect our proprietary rights could seriously impair our competitive position.

If third parties claim we are infringing their intellectual property rights, we could suffer significant litigation, indemnification, or licensing expenses or be prevented from marketing our products.

Our commercial success depends significantly on our ability to operate without infringing the patents and other proprietary rights of others.  However, regardless of our intent, our current or future technologies of our existing operations or those current technologies of our discontinued operations, may infringe upon the patents or violate other proprietary rights of third parties.  In the event of such infringement or violation, we may face expensive litigation or indemnification obligations and may be prevented from selling existing products and pursuing product development or commercialization.

We depend on single and sole source suppliers for certain raw materials and licensed or manufactured products and the loss of any supplier could adversely affect our ability to manufacture or sell many of our products.

We currently rely on single or sole source suppliers for raw materials used in many of our products, including silicone.  In the event that they cannot meet our requirements, we cannot guarantee that we would be able to obtain a sufficient amount of quality raw materials in a timely manner.  We also depend on third party manufacturers and suppliers for components and licensed products.  In connection with the sale of our Urology Business to Coloplast, we have entered into a supply agreement with Coloplast for certain components of our breast implant products.  For the short-term, Coloplast would be our sole source for these components, and if we were unable to obtain the supply, our business would be harmed.  We may determine that we do not want to continue to purchase products from Coloplast or Coloplast may be unable to meet our needs in a timely manner, either of which may disrupt our business during the period we negotiate a supply agreement with and qualify the manufacturing process of a third party or begin production of the components ourselves.  In addition, we depend on Niadyne, Inc. for the supply of NIA-24 and if we were no longer able to satisfy demand for this product through our relationship with Niadyne, our business could be harmed.  If there is a disruption in the supply of any of these single or sole source products, our future sales and profitability would be adversely affected. 

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Our international business exposes us to a number of risks.

More than one-quarter of our sales for our continuing operations are derived from international operations.  Accordingly, any material decrease in foreign sales would have a material adverse effect on our overall sales and profitability.  Most of our international sales are denominated in Euros, British Pounds, Canadian dollars or U.S. dollars.  Depreciation or devaluation of the local currencies of countries where we sell our products may result in our products becoming more expensive in local currency terms, thus reducing demand, which could have an adverse effect on our operating results.  Our operations and financial results may be adversely affected by other international factors, including:

• foreign government regulation of medical products;
• product liability, intellectual property and other claims;
• new export license requirements;
• political or economic instability in our target markets;
• trade restrictions;
• changes in tax laws and tariffs;
• managing foreign distributors and manufacturers;
• managing foreign branch offices and staffing; and
• completion.

Health care reimbursement or reform legislation could materially affect our business.

If any national health care reform or other legislation or regulations are passed that imposes limits on the amount of reimbursement for certain types of medical procedures or products, or on the number or type of medical procedures that may be performed, or that has the effect of restricting a physician's ability to select specific products for use in patient procedures, such changes could have a material adverse effect on the demand for our products.  Our revenues partially depend on U.S. and foreign government health care programs and private health insurers reimbursing patients' medical expenses.  Physicians, hospitals, and other health care providers may not purchase our products if they do not receive satisfactory reimbursement from these third-party payers for the cost of procedures using our products.  In the U.S., there have been, and we expect that there will continue to be, a number of federal and state legislative and regulatory proposals to implement greater governmental control over the healthcare industry and its related costs.  These proposals create uncertainty as to the future of our industry and may have a material adverse effect on our ability to raise capital or to form collaborations.  In a number of foreign markets, the pricing and profitability of healthcare products are subject to governmental influence or control.  In addition, legislation or regulations that impose restrictions on the price that may be charged for healthcare products or medical devices may adversely affect our sales and profitability.

26

If our use of hazardous materials result in contamination or injury, we could suffer significant financial loss.

We are subject to federal, state, local and foreign environmental laws and regulations.  Our manufacturing and research and development activities involve the controlled use of potentially hazardous materials, chemicals and biological materials, which require compliance with various laws and regulations regarding the use, storage, and disposal of such materials.  We believe our continuing and discontinued operations comply in all material respects with applicable environmental laws and regulations in each country where we have a business presence.  Although we continue to make expenditures for environmental protection, we do not anticipate any additional significant expenditures, in complying with such laws and regulations, that would have a material impact on our earnings or competitive position.  We are not aware of any pending litigation or significant financial obligations arising from current or past environmental practices that are likely to have a material adverse effect on our financial position.  We cannot assure, however, that environmental claims or indemnification obligations relating to our continuing or discontinued operations, or properties currently or previously owned or operated by us will not develop in the future, nor can we predict whether any such claims, if they were to develop, would require significant expenditures on our part.  We cannot eliminate the risk of accidental contamination or injury from these materials.  In the event of an accident or environmental discharge, we may be held liable for any resulting damages, which may exceed our financial resources and any applicable insurance coverage.  In addition, we are unable to predict what legislation or regulations may be adopted or enacted in the future with respect to environmental protection and waste disposal.

We are subject to regulation by the United States Environmental Protection Agency and other state and local environmental agencies in each of our domestic manufacturing facilities.  For example, in Texas, we are subject to regulation by the local Air Pollution Control District as a result of some of the chemicals used in our manufacturing processes.  Prior to the June 2, 2006 Coloplast transaction, we were also subject to regulation by the United States Nuclear Regulatory Commission in our Oklahoma facility due to the manufacture and distribution of brachytherapy seeds using radioactive iodine I-125 and palladium Pd-103.  We may have continuing liability for any violations which arose prior to the Coloplast transaction.  In our Wisconsin facility, we are also subject to regulation by the U.S. Department of Health and Human Services, Centers for Disease Control, due to the nature of the biological agent used to manufacture our botulinum toxin product, Clostridium botulinum type A, which is still in the development phase.  Failure to comply with the regulations and requirements of these various agencies could affect our ability to manufacture products and may have a significant negative impact on sales and results of operations.

Future changes in financial accounting standards may cause adverse unexpected revenue or expense fluctuations and affect our reported results of operations.

A change in accounting standards could have a significant effect on our reported results and may even affect our reporting of transactions completed before the change is effective.  New pronouncements and varying interpretations of existing pronouncements have occurred and may occur in the future.  Changes to existing rules or current practices may adversely affect our reported financial results and require restatement of previously issued results for retroactive application of the new accounting standard.  This was evidenced by the adoption of EITF 04-8 in the quarter ended December 2004, resulting in the restatement of diluted earnings per share and weighted average shares outstanding, for fiscal year 2004 and the interim periods ending June 30, and September 30, 2004.

Changes in the accounting treatment of stock-based awards will adversely affect our reported results of operations.

In December 2004 the Financial Accounting Standards Board, or FASB, issued Statement of Financial Accounting Standards, or SFAS, No. 123 (revised 2004), Share-Based Payment, or SFAS 123(R), which is a revision of SFAS No. 123, Accounting for Stock-Based Compensation, or SFAS 123.  SFAS 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their grant date fair values and does not allow the previously permitted disclosure-only method as an alternative to financial statement recognition.  Effective April 1, 2006 we adopted SFAS 123(R).

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The adoption of the SFAS 123(R) fair value method will have a significant adverse impact on our reported results of operations because the stock-based compensation expense will be charged directly against our reported earnings.  If there are any modifications or cancellations of the underlying unvested securities, we may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense.  To the extent that we grant additional equity securities to employees or assume unvested securities in connection with any acquisitions, our stock-based compensation expense will be increased by the additional unearned compensation resulting from those additional grants or acquisitions.  We anticipate we will grant additional employee stock options and restricted stock in the first quarter of fiscal 2007 as part of our regular annual equity compensation program.  The fair value of these grants is not included in the amount above, as the impact of these grants cannot be predicted at this time because it will depend on the number of share-based payments granted as part of the focal review program and the then current fair values.

Had we adopted SFAS 123(R) in prior periods, the magnitude of the impact of that standard on our results of operations would have approximated the impact of SFAS 123 assuming the application of the Black-Scholes option pricing model as described in the disclosure of pro forma net income  and pro forma net income  per share in Note G of Notes to Consolidated Financial Statements.  SFAS 123(R) also requires the benefits of tax deductions in excess of recognized compensation cost to be reported as a financing cash flow, rather than as an operating cash flow as required under current literature.  This requirement may reduce net operating cash flows and increase net financing cash flows in periods after its adoption.

Hedging transactions and other transactions may affect the value of the notes.

In connection with the original issuance of our 2¾% convertible subordinated notes in December 2003, we entered into convertible note hedge and warrant transactions with respect to our common stock, with Credit Suisse First Boston International, an affiliate of Credit Suisse First Boston LLC, the initial purchaser of the notes, to reduce the potential dilution from conversion of the notes up to a price of our common stock of approximately $39.26 per share.  In connection with these hedging arrangements, Credit Suisse First Boston International, and/or its affiliates, has taken and, we expect, will continue to take positions in our common stock in secondary market transactions and/or will enter into various derivative transactions.  Such hedging arrangements could adversely affect the market price of our common stock.  In addition, the existence of the notes may encourage short selling in our common stock by market participants because the conversion of the notes could depress the price of our common stock.

Litigation may harm our business or otherwise distract our management.

Substantial, complex or extended litigation could cause us to incur large expenditures and distract our management, and could result in significant monetary or equitable judgments against us.  For example, lawsuits by employees, patients, customers, licensors, licensees, suppliers, business partners, distributors, shareholders, or competitors could be very costly and could substantially disrupt our business.  Disputes from time to time with such companies or individuals are not uncommon, and we cannot assure that we will always be able to resolve such disputes out of court or on terms favorable to us.

Our publicly-filed SEC reports are reviewed by the SEC from time to time and any significant changes required as a result of any such review may result in material liability to us and have a material adverse impact on the trading price of our common stock.

The reports of publicly-traded companies are subject to review by the SEC from time to time for the purpose of assisting companies in complying with applicable disclosure requirements and to enhance the overall effectiveness of companies public filings, and comprehensive reviews by the SEC of such reports are now required at least every three years under the Sarbanes-Oxley Act of 2002.  SEC reviews often occur at the time companies file registration statements such as the registration statement we filed in connection with our convertible note offering, but reviews may also be initiated at any time by the SEC.  While we believe that our previously filed SEC reports comply, and we intend that all future reports will comply in all material respects with the published rules and regulations of the SEC, we could be required to modify or reformulate information contained in prior filings as a result of an SEC review.  Any modification or reformulation of information contained in such reports could be significant and result in material liability to us and have a material adverse impact on the trading price of our securities, including our common stock or our convertible notes.

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Our operating results may fluctuate substantially, and could precipitate unexpected movement in the price of our common stock and convertible notes. 

Our common stock trades on the New York Stock Exchange under the symbol "MNT."  On March 31, 2006, the closing price of our common stock on the New York Stock Exchange was $45.31 per share.  On December 22, 2003, we completed an offering of $150 million of convertible subordinated notes ("notes") due January 1, 2024 pursuant to Rule 144A under the Securities Act of 1933.  The notes bear interest at 2¾% per annum, are convertible into shares of our common stock at an adjusted conversion price of $29.167 per share and are subordinated to all existing and future senior debt.  The market prices of our stock and convertible securities are subject to significant fluctuations in response to the factors set forth above and other factors, many of which are beyond our control including such factors as changes in pricing policies by our competitors and the timing of significant orders and shipments.

Such factors, as well as other economic conditions, may adversely affect the market price of our securities, including our common stock and convertible notes.  There could be periods in which we experience shortfalls in revenue and/or earnings from levels expected by securities analysts and investors, which could have an immediate and significant adverse effect on the trading price of our securities, including our common stock and our convertible notes.

ITEM 1B. UNRESOLVED STAFF COMMENTS.    None.

  ITEM 2.   PROPERTIES.

We own and lease the following facilities:

Location	Total Sq. Ft.	Principal Segment and Use
Owned Properties
Netherlands	65,000	Manufacturing, warehousing and administrative offices
Minnesota	20,000	Manufacturing, warehousing
	85,000
Leased Properties
Texas	134,000	Manufacturing, warehousing and administrative offices:
California	127,000	Corporate offices, research and development, and sales and marketing
Arizona	32,000	Manufacturing, warehousing and administrative offices
United Kingdom	23,000	Manufacturing, warehousing and administrative offices
Canada	11,000	Sales, warehousing and administrative offices
Wisconsin	10,000	Research and development
	337,000

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Our property in The Netherlands is pledged as collateral on borrowings under a Loan and Overdraft Facility with Cooperative RaboBank Leiden.  See "Liquidity and Capital Resources" under Item 7A - "Management's Discussion and Analysis of Financial Condition and Results of Operations" for additional information.  Our leases have terms ranging from 1 to 15 years, many of which have options to renew on terms we consider favorable.  In addition to the facilities mentioned above, we have international sales offices throughout eight countries where we lease office and warehouse space ranging from 1,000 to 8,000 square feet.  We anticipate that we will be able to extend or renew the leases that expire in the near future on terms satisfactory to us, or if necessary, locate substitute facilities on acceptable terms.

We believe our facilities are generally suitable and adequate to accommodate our current operations and additional suitable facilities are readily available to accommodate future expansion as necessary.

For information regarding lease obligations see Note N "Commitments" under "Notes to the Consolidated Financial Statements."

ITEM 3. LEGAL PROCEEDINGS.

On March 4, 2004, John H. Alico, et. al., d/b/a PTF Royalty Partnership ("PTF") filed a lawsuit against us in the Business Litigation Session of the Superior Court of Massachusetts, Suffolk County in which PTF alleges, among other things, breach of a merger agreement that involved our acquisition of Mentor O&O, Inc. ("O&O"), an unrelated entity at that time, which was dated as of March 14, 1990 ("Merger Agreement") (prior to the merger, O&O had no affiliation with us).  PTF alleges that we breached the terms of the Merger Agreement by failing to exert commercially reasonable and diligent efforts to obtain approval by the FDA for a product used for the treatment of urinary incontinence and by failing to accurately account for and pay royalties due thereunder.  PTF seeks damages in excess of $18 million, which is the maximum amount of royalties PTF could have received under the Merger Agreement.  After almost ten years, in or about January 2001, we elected to discontinue pursuing FDA approval for the product, given the FDA's repeated and ongoing concerns regarding the product's use for urinary incontinence.  We complied with all of our obligations under the Merger Agreement, which specifically provided that we were under no obligation to engage in efforts or expenditures in respect of the product which we in good faith deemed to be inadvisable based on various factors.  Accordingly, we intend to vigorously defend the lawsuit.  Dr. Richard Young, who was a member of our Board of Directors from March 1990 until his retirement on March 1, 2006, was also a partner of PTF and was a named plaintiff in the above action.  Dr. Young was a shareholder and principal of O&O prior to the merger and was instrumental in facilitating the transition after the merger.  Pursuant to Dr. Young's request, the PTF Partnership Agreement was amended to permit withdrawal of partners from the PTF Royalty Partnership upon notice.  On June 3, 2005, Dr. Young submitted his notice of withdrawal to the Partnership, and a joint stipulation removing Dr. Young from the caption of the complaint and as a named party to the litigation was entered by the court in June 2005.

In addition, in the ordinary course of our business we experience other varied types of claims that sometimes result in litigation or other legal proceedings.  Although there can be no certainty, we do not anticipate that any of these proceedings will have a material adverse effect on us.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

No matters were submitted for a vote of our shareholders during the fourth quarter of the fiscal year ended March 31, 2006.

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PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Our common stock trades on the New York Stock Exchange under the symbol "MNT".  The high and low quarterly closing sales prices of our common stock, as reported by the NYSE for the two most recent fiscal years are set forth below. 

Year Ended March 31, 2006	High		Low
Quarter ended March 31, 2006	$	49.20	$	41.60
Quarter ended December 31, 2005	$	56.14	$	43.54
Quarter ended September 30, 2005	$	55.99	$	41.21
Quarter ended June 30, 2005	$	43.03	$	31.90
Year Ended March 31, 2005	High		Low
Quarter ended March 31, 2005	$	35.80	$	29.98
Quarter ended December 31, 2004	$	35.18	$	29.20
Quarter ended September 30, 2004	$	35.94	$	29.59
Quarter ended June 30, 2004	$	34.43	$	29.80

According to the records of our transfer agent, there were approximately 860 holders of record of our common stock on June 11, 2006.  However, the majority of shares are held by brokers and other institutions on behalf of shareholders.

Dividend Policy

We periodically declare cash dividends on our common stock.  It is our intent to continue to pay dividends for the foreseeable future subject to, among other things, Board approval, cash availability, limitations under our existing credit facility, and alternative cash needs.  Our existing credit agreement limits the aggregate amount of dividends payable in any fiscal year to 60% of our net income for the four most recent fiscal quarters.

	Quarterly Cash Dividends Declared
	Year Ended March 31,
	2006		2005		2004
First Quarter	$	0.17	$	0.15	$	0.02
Second Quarter	0.18		0.17		0.15
Third Quarter	0.18		0.17		0.15
Fourth Quarter	0.18		0.17		0.15
Total	$	0.71	$	0.66	$	0.47

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Issuer Purchases of Equity Securities

Our Board of Directors has authorized a stock repurchase program, primarily to offset the dilutive effect of our employee stock option plans, to provide liquidity to the market and to reduce the overall number of shares outstanding.  All shares repurchased under the program are retired and are no longer deemed to be outstanding.  The timing of repurchases is subject to market conditions, cash availability, and blackout periods during which we are restricted from repurchasing shares.  On May 31, 2006 we amended our Credit Agreement to expand the amount of equity securities we can repurchase to $250 million plus a subsequent amount during any four consecutive quarters equal to our consolidated net income less dividends paid for the preceding four quarters.  On June 5, 2006, we repurchased 2.0 million shares for a total of $84 million from an investment partnership managed by ValueAct Capital, whose managing director, Mr. Jeff Ubben, is a member of our Board of Directors.  The repurchase of these shares was pre-approved by our Audit Committee and the majority of our Board of Directors with interested parties abstaining or not in attendance.  As a result of this repurchase, 3.3 million shares remain authorized for repurchase, and $166.0 million plus additional amounts equivalent to our consolidated net income, less dividends, remains available under our Credit Agreement limitations.  The table below sets forth certain share repurchase information for the quarter ended March 31, 2006.

ISSUER PURCHASES OF EQUITY SECURITIES
(in thousands except per share amounts)	Total Number of Shares Purchased	Average Price Paid per Share	Total Number of Shares Purchased as Part of Publicly Announced Plans	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
Fourth Quarter 2006
January 1 - January 31, 2006	-	-	-	1,254
February 1 - February 28, 2006	-	-	-	1,254
March 1 - March 31, 2006	0.996	$  43.00	0.996	5,258
Total	0.996	$  43.00	0.996	5,258

a.     In the first quarter of fiscal 1996, our Board of Director's authorized an ongoing stock repurchase program.  The initial authorization was for the repurchase of up to one million shares.  Subsequently the Board of directors has authorized the repurchase of an additional 24.2 million shares including 5.0 million, 2.2 million and 5.0 shares in March 2006, May 2003 and December 2003, respectively.  These share amounts have been adjusted for the two-for-one stock split affected December 2002. 

b.     We have not set a date for the stock repurchase program to expire.

We intend to repurchase shares during fiscal 2007 through a plan under Rule 10b5-1, which we anticipate adopting during the first quarter fiscal 2007.  The first purchases under the 10b5-1 plan will not occur until after the public announcement of our results for the quarter ending June 30, 2006.  We cannot estimate or guarantee the amount of shares to be repurchased under this plan. 

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ITEM 6. SELECTED FINANCIAL DATA.

The selected consolidated financial information presented below is obtained from our audited consolidated financial statements for each of the five fiscal years ending March 31, 2006.  This selected financial data should be read together with our consolidated financial statements and related notes, as well as the discussion under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations."

	Year Ended March 31,
(in thousands, except per share data)	2006		2005		2004		2003		2002
Statement of Income Data:
Net sales	$	268,272	$	251,726	$	218,437	$	191,404	$	163,091
Gross profit	199,063		187,150		157,854		137,544		113,401
Operating income from continuing operations	69,065		65,381		66,206		57,506		40,900
Income before income taxes -
continuing operations	67,685		62,745		67,251		59,066		43,128
Income taxes - continuing operations	19,606		19,937		21,479		17,186		12,114
Income from continuing operations	48,079		42,808		45,772		41,880		31,014
Discontinued operations, net of income tax(1)	14,278		12,073		9,007		13,940		10,806
Net income	$	62,357	$	54,881	$	54,779	$	55,820	$	41,820
Basic earnings per share(2):
Continuing operations	$	1.12	$	1.02	$	1.00	$	0.90	$	0.65
Discontinued operations(1)	0.33		0.29		0.20		0.30		0.23
Basic earnings per share	$	1.45	$	1.31	$	1.20	$	1.20	$	0.88
Diluted earnings per share(2):
Continuing operations	$	1.01	$	0.93	$	0.95	$	0.86	$	0.63
Discontinued operations(1)	0.28		0.24		0.18		0.29		0.22
Diluted earnings per share	$	1.29	$	1.17	$	1.13(2)	$	1.15	$	0.85
Dividends per common share	$	0.71	$	0.66	$	0.47	$	0.07	$	0.06
Average outstanding shares(2):
Basic	42,995		41,921		45,543		46,428		47,278
Diluted	50,870		49,667		49,272(3)		48,388		48,926
Balance Sheet Data:
Working capital	$	210,019	$	148,434	$	149,981	$	134,863	$	104,609
Total assets	400,518		311,962		312,236		241,480		206,193
Long-term accrued liabilities, less current    portion	18,984		15,385		13,597		10,777		7,432
Convertible subordinated notes	150,000		150,000		150,000		-		-
Shareholders' equity	$	226,589	$	172,527	$	196,004	$	276,136	$	226,602

(1)	In June 2006, we sold our surgical urology and clinical and consumer healthcare businesses.  As a result, the operations for these former businesses have been reflected as discontinued operations for all prior periods.  See "Note T - Discontinued Operations" in the "Notes to the Consolidated Financial Statements."
(2)	Per share amounts and shares outstanding have been adjusted to reflect a two-for-one stock split effected January 21, 2003.
(3)	Per share amounts and diluted shares outstanding for fiscal 2004 have been restated to reflect the additional shares that would be issued upon conversion of our 2¾% convertible notes, in accordance with the adoption of Emerging Issue Task Force (EITF) Issue No. 04-8 in the quarter ended December 2004.

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion should be read together with our consolidated financial statements and related notes, which are included in this report, and the information in the "Item 1A. Risk Factors" section of this report. 

OVERVIEW

We develop, manufacture and market a range of products serving the aesthetic medicine market, including plastic and reconstructive surgery.  Our products include surgically implantable prosthesis for plastic and reconstructive surgery, as well as capital equipment and consumables used for soft tissue aspiration for body contouring (liposuction).  Historically, we operated in three reportable segments:  aesthetic and general surgery, surgical urology, and clinical and consumer healthcare.  Our surgical and urology products included surgically implantable prostheses for the treatment of impotence, surgically implantable incontinence products, urinary care products and brachytherapy seeds for the treatment of prostate cancer.  Our clinical and consumer healthcare products included catheters and other products for the management or urinary incontinence and retention.  In October 2005, we began to evaluate strategic alternatives for our surgical urology and clinical and consumer healthcare businesses.  On May 17, 2006, we entered into a definitive purchase agreement to sell our Urology Business to Coloplast A/S for total consideration of $463 million ($456 million in cash and the remainder consisting of the value of certain foreign tax credits that we expect to realize arising from the transaction prior to the close).  On June 2, 2006, the sale of the Urology Business was completed.  On June 1, 2006, our Porges SAS subsidiary sold certain intellectual property to Coloplast for $52 million, which is included in the total consideration of $463 million.  The purchase price is subject to a post-closing adjustment based on the working capital of the acquired business as of the closing date, and a downward reduction in an amount equal to 50% of the amount of certain transfer taxes and related fees incurred in connection with the transaction, 50% of the cost of severance obligations in respect of certain former employees of the Urology Business who will not continue with the Urology Business following the closing of the transaction, and certain other administrative costs.

The purchase agreement with Coloplast contains customary representations and warranties and indemnification provisions whereby each party agrees to indemnify the other for breaches of representations and warranties, breaches of covenants and other matters, with our liability for breaches of representations and warranties generally limited to 15% of the purchase price.  Pursuant to the terms of the purchase agreement, an escrow fund was established with $10 million withheld from the purchase price to secure our indemnification obligations with respect to any breaches of our representations and warranties for a period of 18 months.  In addition, the purchase agreement provides that we will not enter into or engage in a business that competes with the Urology Business, on a worldwide basis, for a period of seven years following the closing of the transaction.  These restrictions on competition do not apply to (i) the development, manufacture or sale of any oral pharmaceuticals or any product or treatments involving dermal fillers or other bulking agents or toxins, including botulinum toxins, or (ii) any business acquired and operated by us or our affiliates for so long as any such businesses generate less than $5 million in aggregate annual revenues from any competing business.  These restrictions on competition terminate upon a change in control of Mentor.

In connection with the sale to Coloplast, we also entered into a Transition Services Agreement and various supply agreements.  Pursuant to the Transition Services Agreement, in exchange for specified fees, we will provide to Coloplast and Coloplast will provide to us, services including accounting, information technology, customer support and use of facilities.  Under the supply agreements we will supply various products, including silicone gel-filled testicular implants to Coloplast and Coloplast will supply us with components for the manufacture of our breast implants.  These services agreements are expected to extend through a period not to exceed twelve months and the supply agreements range from a period of 6 - 36 months.  These services and supply agreements are not expected to have a significant impact on our future cash flows from continuing operations.

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On June 2, 2006, we also completed the sale of our intellectual property, raw materials and tangible assets for the production of silicone male external catheters relating to our catheter production facility in Anoka, Minnesota and our inventory of such catheters to Rochester Medical Corporation, for an aggregate purchase price of approximately $1.6 million. 

As a result of the sale to Coloplast, the assets and liabilities related to the Urology Business have been segregated from continuing operations and are reported as assets and liabilities of discontinued operations in the accompanying consolidated balance sheets.  In addition, operations associated with the Urology Business have been classified as income from discontinued operations in the accompanying consolidated statements of income.  Prior to being designated as discontinued operations, the Urology Business contributed approximately 47% of our consolidated net sales and approximately 27% of our operating profit in fiscal year 2006.  We will record a net gain on the sale of our Urology Business in the first quarter of fiscal 2007.  As a result of this sale, we will be able to focus on the aesthetic medicine market.  We intend to leverage our traditional strengths in plastic surgery and grow our market presence in cosmetic dermatology.

APPLICATION OF CRITICAL ACCOUNTING POLICIES

Management's Discussion and Analysis of Financial Condition and Results of Operations addresses our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.  The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.  On an on-going basis, we evaluate our estimates and judgments.  We base our estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.  Actual results may differ from these estimates under different assumptions or conditions. 

We believe the following critical accounting policies, among others, affect our more significant judgments and estimates used in the preparation of our consolidated financial statements.

Revenue Recognition

We recognize product revenue, net of discounts, returns, and rebates in accordance with Statement of Financial Accounting Standards ("SFAS") No. 48, "Revenue Recognition When the Right of Return Exists," and Staff Accounting Bulletin ("SAB") No. 104, "Revenue Recognition."

As required by these standards, revenue is recorded when persuasive evidence of a sales arrangement exists, delivery has occurred, the buyer's price is fixed or determinable, contractual obligations have been satisfied, and collectibility is reasonably assured.  These requirements are met, and sales and related cost of sales are recognized, upon the shipment of products, or in the case of consignment inventories, upon the notification of usage by the customer.  We record estimated reductions to revenue for customer programs and other volume-based incentives.  Should the actual level of customer participation in these programs differ from those estimated, additional adjustments to revenue may be required.  We also allow credit for products returned within our policy terms.  We record an allowance for estimated returns at the time of sale based on historical experience, recent gross sales levels and any notification of pending returns.  Should the actual returns differ from those estimated, additional adjustments to revenue and cost of sales may be required.

Our deferred revenue consists of both current and long term and includes funds received in connection with sales of our Enhanced Advantage Breast Implant Limited Warranty program.  The fees received in connection with a sale of an Enhanced Advantage Breast Implant Limited Warranty are deferred and recognized as revenue evenly over the life of the warranty term.

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Accounts Receivable

We market our products to a diverse customer base, principally throughout the United States, Canada, Western Europe, Central and South America, and the Pacific Rim.  We grant credit terms in the normal course of business to our customers, primarily hospitals, doctors and distributors.  We perform ongoing credit evaluations of our customers and adjust credit limits based upon payment history and the customer's current credit worthiness, as determined through review of their current credit information.  We continuously monitor collections and payments from customers and maintain allowances for doubtful accounts for estimated losses resulting from the inability of some of our customers to make required payments.  Estimated losses are based on historical experience and any specifically identified customer collection issues.  If the financial condition of our customers, or the economy as whole, were to deteriorate resulting in an impairment of our customers' ability to make payments, additional allowances may be required.  These additional allowances for estimated losses would be included in selling, general and administrative expenses.

Inventories

We value our inventory at the lower of cost, based on the first-in first-out ("FIFO") cost method, or the current estimated market value of the inventory.  We write down our inventory for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions.  If actual future demand or market conditions differ from those projected by us, additional inventory valuation adjustments may be required.  These additional valuation adjustments would be included in cost of sales.

Warranty Reserves

We offer two types of warranties relating to our breast implants in the United States, Canada, and Puerto Rico: a standard limited warranty which is offered at no additional charge and an enhanced limited warranty at an additional charge of $100 in the U.S. ($100 CAD in Canada), which provide limited financial assistance in the event of a deflation or rupture.  Our standard limited warranty is also offered in certain European and other international countries for silicone gel-filled breast implants.  We provide an accrual for the estimated cost of breast implant warranties at the time revenue is recognized.  Costs related to warranties are recorded in cost of sales.  The estimated cost of the standard limited warranty is recorded as an expense at the time of sale, whereas the estimated cost of the enhanced limited warranty is deferred and recognized over the term of the enhanced limited warranty which approximates costs as incurred.  Such accruals are based on estimates, which are based on relevant factors such as unit sales, historical experience, the limited warranty period, estimated costs, and, to a limited extent, information developed by our insurance company using actuarial techniques.  These accruals are analyzed periodically for adequacy.  While we engage in extensive product quality programs and processes, including actively monitoring and evaluating the quality of our component suppliers, the warranty obligation is affected by reported rates of warranty claims and levels of financial assistance specified in the limited warranties.  Should actual patient claim rates reported differ from our estimates, adjustments to the estimated warranty liability may be required.  These adjustments would be included in cost of sales.

Product Liability Reserves

We have product liability reserves for product-related claims to the extent those claims may result in litigation expenses, settlements or judgments within our self-insured retention limits.  We have also established additional reserves, through our wholly-owned captive insurance company, for estimated liabilities for product-related claims based on actuarially determined estimated liabilities, taking also into account our excess insurance coverages.  The actuarial valuations are based on historical information and certain assumptions about future events.  Product liability costs are recorded in selling, general and administrative expenses as they are directly under the control of our General Counsel and other general and administrative staff and are directly impacted by our overall corporate risk management strategy.  Should actual product liability experience differ from the estimates and assumptions used to develop these reserves, subsequent changes in reserves will be recorded in selling, general and administrative expenses, and may affect our operating results in future periods. 

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Goodwill and Intangible Asset Impairment

We evaluate long-lived assets, including goodwill and other intangibles, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable.  In addition, we evaluate goodwill and other intangibles annually in the fourth quarter of each fiscal year.  In assessing the recoverability of goodwill and other intangibles, we must make assumptions regarding estimated future cash flows and other factors to determine the fair value of the respective assets.  We adopted SFAS No. 142, "Goodwill and Other Intangible Assets," effective April 1, 2002 and analyzed goodwill and intangibles for impairment.  Impairment tests were performed at adoption, and in the fourth quarter of fiscal years 2003, 2004 and 2006, and no impairment was noted as a result of these analyses.  The impairment tests performed in fiscal 2005 indicated certain impaired assets, for which we recorded impairment charges in fiscal 2005.  These impairment charges are included in the results of operations. See Note I - - "Intangible Assets and Goodwill" of the "Notes to the Consolidated Financial Statements."

Stock-Based Compensation Expense for Fiscal 2007 and Thereafter

Effective April 1, 2006 we adopted SFAS No. 123 (revised 2004), Share-Based Payment, or SFAS 123(R). SFAS 123(R) requires all share-based payments, including grants of stock options, restricted stock units and employee stock purchase rights, to be recognized in our financial statements based on their respective grant date fair values. Under this standard, the fair value of each employee stock option and employee stock purchase right is estimated on the date of grant using an option pricing model that meets certain requirements. We currently use the Black-Scholes option pricing model to estimate the fair value of our share-based payments.  The Black-Scholes model meets the requirements of SFAS 123(R) but the fair values generated by the model may not be indicative of the actual fair values of our stock-based awards as it does not consider certain factors important to stock-based awards, such as continued employment and periodic vesting requirements and limited transferability.  The determination of the fair value of share-based payment awards utilizing the Black-Scholes model is affected by our stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends.  We use the implied volatility for traded options on our stock as the expected volatility assumption required in the Black-Scholes model.  Our selection of the implied volatility approach is based on the availability of data regarding actively traded options on our stock as we believe that implied volatility is more representative than historical volatility.  The expected life of the stock options is based on historical and other economic data trended into the future.  The risk-free interest rate assumption is based on observed interest rates appropriate for the terms of our stock options and stock purchase rights.  The dividend yield assumption is based on our history and expectation of dividend payouts.  The fair value of our restricted stock units is based on the fair market value of our common stock on the date of grant.  Stock-based compensation expense recognized in our financial statements in fiscal 2006 and thereafter is based on awards that are ultimately expected to vest.  The amount of stock-based compensation expense in fiscal 2007 and thereafter will be reduced for estimated forfeitures based on historical experience.  Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.  We will evaluate the assumptions used to value stock awards on a quarterly basis.  If factors change and we employ different assumptions, stock-based compensation expense may differ significantly from what we have recorded in the past.  If there are any modifications or cancellations of the underlying unvested securities, we may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense.  To the extent that we grant additional equity securities to employees or we assume unvested securities in connection with any acquisitions, our stock-based compensation expense will be increased by the additional unearned compensation resulting from those additional grants or acquisitions.  Had we adopted SFAS 123(R) in prior periods, the magnitude of the impact of that standard on our results of operations would have approximated the impact of SFAS 123 assuming the application of the Black-Scholes option pricing model as described in the disclosure of pro forma net income and pro forma net income per share in Note G of our "Notes to Consolidated Financial Statements".

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RESULTS OF OPERATIONS

The following table sets forth various items from the Consolidated Statements of Income as a percentage of net sales for the periods indicated:

	Year Ended March 31,
	2006	2005	2004
Net sales	100.0%	100.0%	100.0%
Cost of sales	25.8%	25.7%	27.7%
Gross profit	74.2%	74.3%	72.3%
Selling, general, and administrative	37.7%	34.3%	32.3%
Research and development	10.8%	10.0%	9.7%
Severance charges	-	3.0%	-
Restructuring and long-lived asset impairment charges	-	1.0%	-
Operating income	25.7%	26.0%	30.3%
Interest expense	(2.1)%	(2.0)%	(0.7)%
Interest income	1.5%	0.7%	0.7%
Other income, net	0.1%	0.2%	0.5%
Income before income taxes	25.2%	24.9%	30.8%
Income taxes	7.3%	7.9%	9.8%
Net income from continuing operations	17.9%	17.0%	21.0%
Net income from discontinued operations	5.3%	4.8%	4.1%
Net income	23.2%	21.8%	25.1%

YEARS ENDED MARCH 31, 2006 AND 2005

Sales

Net sales increased 7% to $268.3 million from $251.7 million in the prior year.  Net sales of breast implant products increased 7% to $233.2 million from $217.4 million in the prior year.  The majority of the increase in breast implant product sales is attributable to organic growth in unit sales of our breast implants and associated products. Foreign exchange rate movements, primarily the Euro, had a minimal year-to-year impact on international net sales.  Increased net sales were driven by growth in the reconstruction markets both domestically and internationally.  We saw overall growth in unit sales of breast implant products of approximately 7%.  Although we try to avoid competing on price, we continued to see competitive price pressure in both the domestic and international markets for breast implants.  Net sales of body contouring products decreased 4% to $17.8 million from $18.6 million in the prior year.  Liposuction continues to be the leading surgical cosmetic procedure in the United States; however, we have seen some recent softness in sales growth in our body contouring business.  We have seen some variability in capital equipment purchasing patterns, specifically in our ultrasonically assisted product line, and we are in the process of defining our strategy to improve growth in this business.  Other aesthetic products net sales increased 10% to $17.3 million from $15.7 million in the prior year, primarily as a result of increased revenue from our facial aesthetics products, including Puragen™, which was launched in a variety of international markets in May 2005.  We expect our net sales to increase to approximately $290 - $305 million in fiscal 2007.

Cost of Sales

Cost of sales for fiscal 2006 remained relatively unchanged at 25.8% of net sales, compared to 25.7% in fiscal 2005.  Cost of sales had some variations in quarterly results primarily due to timing of the building of silicone gel breast implant inventory in anticipation of potential FDA approval.

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Selling, General and Administrative

Selling, general and administrative expenses increased $14.6 million to $101.0 million, or 37.7% of net sales, in fiscal 2006 compared to $86.4 million, or 34.3% of net sales, in fiscal 2005.  During fiscal 2006, we incurred approximately $3.4 million of legal and professional fees related to an unsolicited offer to acquire Medicis Inc., which did not materialize.  We did not incur any similar fees during fiscal 2005.  Also contributing to the increased expenses was (i) an increase of approximately $2.0 million in costs associated with our global facial aesthetics selling and marketing efforts in support of our hyaluronic acid-based dermal filler product, Puragen™, (ii) an increase of approximately $1.8 million in costs associated with the expansion of our domestic sales force, (iii) higher levels of expenses at our foreign sales subsidiaries of approximately $1.8, (iv) an increase of approximately $1.6 million related to increased sales and marketing efforts focusing on our international markets, (v) an increase of approximately $1.5 million in compensation expense related to the issuance of restricted stock grants, and (vi) an increase of approximately $0.9 million in our patient and physician education programs.  To a lesser extent, increased personnel costs in support of sales and marketing contributed to the year over year increase.  The increase in selling, general and administrative expenses was partially offset by a decrease in performance-related compensation of approximately $2.9 million and the completion of our direct-to-consumer television advertising program related to our breast implant products, resulting in decreased expenses of approximately $1.4 million.

We expect selling, general and administrative expenses to significantly increase in fiscal 2007 as a result of our adoption of SFAS 123(R) effective April 1, 2006.  However, the amount of the increase cannot be predicted because it will depend on the number of share-based payments granted in fiscal 2007 and the then current fair values.

In addition, during fiscal 2007 we anticipate that we will incur various severance and other restructuring-related charges associated with our transition to a company focused on aesthetic medicine, which we also expect to result in higher selling, general and administrative expenses for the fiscal year.

Research and Development

Research and development spending primarily supports our key strategic product development programs.

Research and development expenses in fiscal 2006 increased $3.8 million to $29.0 million from $25.2 million in fiscal 2005.  The increase in research and development spending was primarily to support key strategic product development programs, including our silicone gel-filled breast implant regulatory submissions in the United States and Canada, our botulinum toxin project, U.S. clinical studies for our hyaluronic acid-based dermal filler product, Puragen™, and the continued development of automated manufacturing technologies. 

We continue to be committed to a variety of clinical studies and laboratory tests in connection with our silicone gel-filled and saline-filled mammary implants and other products.  

Severance Charges

During the fourth quarter of fiscal 2005, two individuals resigned as directors and executive officers of the Company.  In connection with their resignation and severance agreements, we incurred $8.5 million in expenses, comprised of $4.1 million in cash expense and $4.4 million in non-cash expense. 

Restructuring and Long-Lived Asset Impairment Charges 

During the fourth quarter of fiscal year 2005, we incurred $1.7 million in expenses related to restructuring of certain of our operations to achieve improved efficiencies and certain long-lived assets that were determined to be impaired.  The restructuring charges totaled $1.4 million and the impairment charges totaled $0.3 million. 

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Interest and Other Income and Expense

Interest expense increased to $5.7 million in fiscal 2006, compared to $5.1 million in fiscal 2005.  These costs included interest on our $150 million convertible subordinated notes at 2¾% issued in December 2003, interest expense on balances outstanding under our foreign lines of credit, commitment fees on our credit facilities and amortization of debt issuance costs.  The increase in interest expense was primarily attributable to higher commitment fees and was partially offset by lower borrowings on our international facilities. 

Interest income increased $2.1 million to $4.1 million compared to $2.0 million in fiscal 2005, as a result of generally higher rates of interest and higher balances of cash and cash equivalents available for investment.

Other income primarily includes gains or losses on sales of marketable securities and foreign currency gains or losses related to our foreign operations.  Other income decreased to $0.2 million from $0.5 million in the prior year.  This decrease was the result of the increase in the Euro's relative strength compared to the U.S. dollar.

Income Taxes

Our effective rate of corporate income taxes was 29.0% in fiscal year 2006, a decrease of 2.8% of pretax income from the 31.8% rate in fiscal year 2005.  This decrease is a result of greater tax benefits associated with our foreign operations, lower state taxes and increased research and development credits.  In the fourth fiscal quarter of 2006, we repatriated $32.0 million in foreign profits, and estimated the tax liability on the repatriation was approximately $1.7 million. 

Net Income from Continuing Operations and Earnings Per Share

Net income from continuing operations in fiscal 2006 increased to $48.1 million from $42.8 million in fiscal 2005.  Earnings per share from continuing operations increased 9.8% to $1.12 per share in fiscal 2006 from $1.02 per share in fiscal 2005.  Diluted earnings per share from continuing operations increased 8.6% to $1.00 for the fiscal year compared to $0.93 for fiscal 2005 as a result of additional net income, partially offset by a increase in diluted weighted average shares outstanding used to calculate diluted earning per share.

Income from Discontinued Operations, Net of Income Taxes

Income from discontinued operations, net of income taxes, represents the results of our former surgical urology and clinical and consumer healthcare business segments, which were sold to Coloplast on June 2, 2006, as discussed above.  During fiscal 2006, income from discontinued operations, net of income taxes, increased 18% to $14.3 million from $12.1 million in the prior year.  This increase is the result of an increase in net sales of $3.8 million, a decrease in cost of sales of $3.9 million, and a decrease in research and development expense of $1.9 million, partially offset by a $2.5 million increase in selling, general and administrative expense and a $4.2 million increase in income tax expense.  The increase in net sales was less than historic rates of growth due to the disruption as a result of the aforementioned sale process in the second half of the fiscal year, the negative impact of foreign exchange movements of $3.7 million, and the decrease of $1.9 million due to a planned reduction of OEM contract revenue from $5.7 million to $3.8 million.  Cost of sales decreased due to an improved manufacturing process, changes to a more profitable product mix following decreased OEM sales, and product rationalization.    The increased selling, general and administrative expenses were partially offset by decreased restructuring and long-term asset impairment charges recorded in the fourth quarter of the prior year, and a favorable impact of foreign exchange rate movements of $1.5 million.  Income tax expense related to discontinued operations increased due to an additional provision related to open audit issues.  For further details regarding discontinued operations, See Note T of the Notes to Consolidated Financial Statements.

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YEARS ENDED MARCH 31, 2005 AND 2004

Sales

During fiscal 2005, net sales increased 15% to $251.7 million from $218.4 million in the prior year.  Net sales of breast implant products increased 12% to $217.4 million from $194.1 million in the prior year.  Approximately $20.4 million of the increase in breast implant product sales was attributable to organic growth in unit sales of our breast implants and associated products and approximately $3.0 million was the result of a favorable impact of foreign exchange rate movements.  Increased net sales were driven by growth in the augmentation and reconstruction markets both domestically and internationally.  We saw overall growth in domestic unit sales of breast implant products of approximately 12%.  We continued to see competitive price pressure in both the domestic and international markets for breast implants.  Net sales of body contouring products increased 22% to $18.6 million from $15.3 million in the prior year.  Sales of our capital equipment, associated disposable products, and higher average selling prices were the leading contributors to our body contouring sales growth.  Other aesthetic products net sales increased 72% to $15.7 million in fiscal 2005 from $9.1 million in the prior year, primarily as a result of increased revenue from physician participation in our "Extreme Mentor" direct-to-consumer television advertising program which began in September 2004.

Cost of Sales

Cost of sales for fiscal 2005 was 25.7% of net sales, compared to 27.7% in fiscal 2004.   This decrease is primarily due to favorable pricing on raw materials and overall improved manufacturing efficiencies at our Texas and Netherlands facilities in fiscal 2005. 

Selling, General and Administrative

Selling, general and administrative expenses increased $15.8 million to 34.3% of net sales in fiscal 2005 compared to 32.3% of net sales in fiscal 2004.  We had generally higher levels of expenses at our foreign sales and manufacturing subsidiaries of approximately $2.0, of which approximately $1.0 million reflected the effect of foreign currency rate movements, primarily the stronger Euro.  Also contributing to the increase was approximately $3.3 million in incentive compensation expenses associated with achieving specific operating targets, our direct to consumer television advertising program, which was launched in September 2004, of approximately $3.0 million, and higher legal related expenses of approximately $3.2 million due to increased litigation expenses and other legal and corporate matters.  In addition, to a lesser extent, increased costs associated with compliance with the Sarbanes-Oxley Act and increased support of sales and marketing contributed to the year over year increase. 

Research and Development

Research and development expenses in fiscal 2005 increased $4.1 million to $25.2 million from $21.1 million in fiscal 2004.  The majority of the increase was attributable to increased support for our silicone gel-filled breast implant regulatory submissions in the United States and Canada, increased patient volume in our adjunct study, new clinical studies and laboratory testing for our hyaluronic acid-based dermal filler product, Puragen™, and our botulinum toxin project. 

Severance Charges

On February 16, 2005, Christopher J. Conway and Adel Michael each resigned as a director and executive officer of the Company.  In connection with resignation and severance agreements entered into with them, we incurred a total of $8.5 million in expenses in February 2005.

As one of the co-founders of our Company, and following 36 years of service, Mr. Conway received certain severance compensation in the form of cash payments totaling $2.3 million and non-cash benefits in the amount of $2.1 million related to the accelerated vesting of his unvested and unexpired stock options.  In addition, Mr. Adel Michael, our former Vice Chairman, received severance compensation in the form of cash benefits in the amount of $1.8 million and non-cash benefits in the amount of $2.3 million related to the accelerated vesting of his unvested and unexpired employee stock options.  There were no similar charges in fiscal 2004.

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Restructuring and Long-Lived Asset Impairment Charges 

During the fourth quarter of fiscal year 2005, we incurred $1.7 million in expenses related to restructuring of certain of our operations to achieve improved efficiencies and certain long-lived assets that were determined to be impaired.  The restructuring charges totaled $1.4 million and the impairment charges totaled $0.3 million.  There were no similar charges in fiscal 2004.

Interest and Other Income and Expense

Interest expense increased to $5.1 million in fiscal 2005, compared to $1.6 million in fiscal 2004.  Approximately $4.9 million of the fiscal 2005 expense related to the 2¾% coupon and issuance cost amortization for our $150 million convertible subordinated notes issued in December 2003.  The increase in interest expense was attributable to a full year of interest and amortization of issuance costs on these notes in fiscal 2005.  In fiscal 2004, interest expense included only four months of accrued interest payable and amortization of bond issue costs.  The remaining interest expense in fiscal 2005, was interest on balances outstanding under our foreign lines of credit, which benefited from lower rates of interest and lower levels of borrowings in fiscal 2005. 

Interest income increased to $2.0 million in fiscal 2005, from $1.6 million in fiscal 2004.  The increase was due to higher prevailing interest rates on short term investments, and slightly longer maturities, partially offset by lower levels of cash balances available for investment. 

Other income decreased to $0.5 million in fiscal 2005 from $1.0 million in the prior year.  This decrease was the result of the less favorable impact of the Euro's relative strength compared to the U.S. dollar, and a decrease in realized and unrealized gains and losses in our portfolio of marketable securities.  These decreases were partially offset by a one-time gain in fiscal 2005 of approximately $0.5 million relating to insurance proceeds received to cover lost sales margin on finished goods inventory that was damaged.

Income Taxes

Our effective rate of corporate income taxes remained relatively flat at  31.8% in fiscal year 2005 compared to 31.9%in fiscal year 2004.

Net Income from Continuing Operations and Earnings Per Share

Net income from continuing operations in fiscal 2005 decreased $3.0 million to $42.8 million from $45.8 million in fiscal 2004.  Earnings per share from continuing operations was  $1.02 per share in fiscal 2005 and $1.01 per share in fiscal 2004.  Diluted earnings per share from continuing operations decreased 2.1% to $0.93 for the fiscal year compared to a restated $0.95 for fiscal 2004.  (As required by EITF 04-8, we have retroactively restated diluted earnings per share figures for fiscal 2004 for the impact of our convertible subordinated notes issued in December 2003.)  The effect of share repurchases was offset by the dilutive effect to earnings per share following the adoption of EITF 04-8 which required the inclusion, for calculation purposes, of additional shares that are contingently issuable. 

Net income from continuing operations in fiscal 2005 decreased to $42.8 million from $45.8 million in fiscal 2004.  Increased net sales and lower cost of sales as a percentage of sales in fiscal 2005 were offset by higher operating expenses, including severance, restructuring and long-lived asset impairment charges, as well as higher interest expense resulting in net income from continuing operations being less than in fiscal 2004.

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Income from Discontinued Operations, Net of Income Taxes

Income from discontinued operations, net of income taxes, represents the results of our former surgical urology and clinical and consumer healthcare business segments, which were sold to Coloplast on June 2, 2006, as discussed above.  During fiscal 2005, income from discontinued operations, net of income taxes, increased 34% to $12.1 million from $9.0 million in the prior year.  This increase is primarily the result of an increase in net sales of $27.9 million, partially offset by a $10.4 million increase in selling, general and administrative expense and a $2.5 million increase in income taxes.  The favorable impact of foreign exchange rate variations contributed approximately $8.8 million to the increase in sales while the remainder of the increase was due to continued market acceptance of our new products and/or line extensions, and an increase in unit sales for commodity type items.  Selling, general and administrative expenses increased as a result of restructuring and long-lived asset impairment charges of $6.8 million which were recorded in the fourth quarter of fiscal 2005.  Income taxes related to discontinued operations increased due to an increase in state and foreign taxes and decrease in R&D credits.  For further details regarding discontinued operations, See Note T of the Notes to Consolidated Financial Statements.

Inflation

We do not believe that inflation has had a material effect on our financial condition and results of operation for the reporting periods presented in this report.  We cannot be certain that inflation will not have a material adverse effect on our business in the future.

Recent Accounting Pronouncements

In December 2004, the Financial Accounting Standards Board issued SFAS No. 123(R), "Share-Based Payment".  As of April 1, 2006, SFAS No. 123(R) requires us to account for our stock options using a fair-value-based method as described in such statement and recognize the resulting compensation expense in our financial statements.  The majority of this compensation expense will be captured in selling, general and administrative expenses.  SFAS 123(R) will also require the benefits of tax deductions in excess of recognized compensation cost to be reported as a financing cash flow, rather than as an operating cash flow as required under current literature.  This requirement will reduce net operating cash flows and increase net financing cash flows in periods after adoption.  Prior to April 1, 2006, we accounted for our employee stock options using the intrinsic value method under APB Opinion No. 25, "Accounting for Stock Issued to Employees" and related interpretations, which generally results in no employee stock option expense.  

LIQUIDITY AND CAPITAL RESOURCES

Cash provided by operating activities and from the exercise of employee stock options has been our primary recurring source of funds.  We recently completed the sale of our Urology Business to Coloplast for total consideration of $463 million, which is subject to customary post-closing adjustments and includes non-cash consideration consisting of the value of certain foreign tax credits that Mentor expects to realize arising from the transaction prior to the close.  On the closing date of June 2, 2006, we received $446 million in cash from Coloplast, and an additional $10 million is held under an escrow agreement in connection with the transaction.  After expenses, we expect net after tax proceeds from the sale to be approximately $340 million.  We believe that existing funds, cash generated from continuing operations, and existing sources of and access to financing are adequate to satisfy our working capital, capital expenditure, and debt service requirements for the foreseeable future.  We believe that the loss of future cash flows from our discontinued surgical urology and clinical and consumer healthcare segments will not have a significant negative impact on our future finance levels, terms of financing or covenants.  Cash flows have been segregated between continuing operations and discontinued operations in the accompanying Consolidated Statements of Cash Flows.  

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As of March 31, 2006, we had cash, cash equivalents and short-term marketable securities of $201.0 million, an increase of $88.1 million or 78%, compared to $112.9 million as of March 31, 2005.  The principal components of the increase in cash, cash equivalents and marketable securities were cash generated from operating activities of continuing operations of $99.0 million, cash generated from operating activities of discontinued operations of $25.4 million, proceeds of $43.6 million from the exercise of employee stock options and stock purchases under our Employee Stock Purchase Plan, net borrowings under line of credit agreements of $13.0 million for continuing operations, offset by $30.0 million in dividends paid, $42.8 million for shares repurchased, $10.1 million used for net capital expenditures of continuing operations, $4.4 million used for net capital expenditures of discontinued operations, and $2.2 million for repayment of debt on our foreign lines of credit for discontinued operations.

We invest excess cash in marketable securities that are highly liquid, of high-quality investment grade, and which have varying maturities.  Our short-term marketable securities consist primarily of state and municipal government and government agency obligations, Federal Home Loan Bank and Mortgage Association bonds, and investment grade corporate obligations, including commercial paper.

	As of March 31,
(in thousands)	2006		2005
Cash and cash equivalents	$	98,713	$	76,666
Marketable debt securities	102,241		36,228
Total cash, cash equivalents and marketable debt securities	$	200,954	$	112,894
Percentage of total assets	36%		24%

Cash Flow Changes

The following table summarizes our cash flow activity:
 

	Year Ended March 31,
(in thousands)	2006		2005		2004
Net cash provided by operating activities of continuing operations	$	99,044	$	62,591	$	62,222
Net cash used by investing activities of continuing operations	(76,052)		(35,032)		(29,902)
Net cash used in financing activities of continuing operations	(16,122)		(99,894)		(17,799)
Net cash provided by (used by) discontinued operations	15,957		30,128		(2,429)
Effect of currency exchange rates on cash and cash equivalents	(780)		648		293
Increase (decrease) in cash and cash equivalents	$	22,047	$	(41,559)	$	12,385

Cash Provided by Operating Activities of Continuing Operations

Cash provided by operating activities of continuing operations of $99.0 million, $62.6 and $62.2 million for the years ended March 31, 2006, 2005 and 2004, respectively, was greater than net income in those years, due to the net impact of non-cash adjustments to income.  Non-cash adjustments include tax benefits from the exercise of employee stock options, depreciation and amortization, deferred income taxes and loss on the disposal of assets.  For the years ended March 31, 2006, 2005 and 2004, operating cash flows were positively impacted in the amount of $12.0 million, $0.3 million and $10.0 million, respectively, by changes in working capital balances.  Our working capital was $210.0 million at March 31, 2006, and $148.4 million at March 31, 2005. 

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Cash Used for Investing Activities of Continuing Operations

Cash used in investing activities of continuing operations was primarily attributable to purchases and sales of marketable debt and equity securities, as well as capital expenditures on property and equipment and intangibles.  For the year ended March 31, 2006, total cash used in investing activities of continuing operations was $76.0 million.  Our net purchases of marketable securities totaled $66.0 million and our capital expenditures totaled $10.1 million.  We anticipate our capital expenditures to total approximately $10.0 million in fiscal 2007, as we will continue to invest in facility improvements, software to support our manufacturing processes, and production equipment.  For the year ended March 31, 2005, total cash used in investing activities of continuing operations was $35.0 million.  This amount was comprised of net investments of $27.9 million in marketable securities, $7.4 million in capital expenditures and $0.2 million in other investment activities.

Cash Provided by Discontinued Operations

Cash provided by discontinued operations was $16.0 million and $30.1 million for the years ended March 31, 2006 and 2005, respectively.  This amount in 2006 was comprised of $25.4 million provided by operating activities of discontinued operations, less capital expenditures of $4.4 million, $2.2 million repaid on lines of credit, $0.8 million in loans made and $2.0 million in currency exchange rate adjustments.  In 2005, the amount was comprised of $34.5 million provided by operating activities of discontinued operations and $0.3 million in currency exchange rate adjustments, less capital expenditures of $2.8 million and $1.9 million repaid on lines of credit.

Cash Used for Financing Activities of Continuing Operations

Net cash from financing activities is primarily a result of cash provided by employee stock option exercises, cash used in payments of dividends and our stock repurchase program, and the net impact of our debt financing activities.

We have a stock repurchase program, primarily to offset the dilutive effect of our employee equity compensation program, to provide liquidity to the market, and to reduce the overall number of shares outstanding.  All shares repurchased under the program are retired and are no longer deemed to be outstanding.  During the quarter ended March 31, 2006 our Board of Directors authorized an additional 5 million shares for repurchase under our repurchase program.  As part of that repurchase program, a total of approximately 996,000 shares were repurchased from two directors who retired during the quarter.  These shares were purchased on March 2, 2006 for approximately $42.8 million at $43.00 per share, a discount from the market closing price quotation from the NYSE of $44.37 on that date.  During the quarter ended December 31, 2004, 2.3 million shares were repurchased for $79.8 million.  The December 2004 repurchase included the repurchase of 2.25 million shares from two investment partnerships managed by VA Partners, LLC, which was at the time, our largest shareholder.  On June 5, 2006, we agreed to repurchase 2 million additional shares from an investment partnership managed by ValueAct Capital at $42.00 per share, a discount from the closing market price quoted on the NYSE of $42.21 on that date.  The 2.0 million shares were repurchased for a total of $84 million pursuant to the Company's continuing stock repurchase program.  Mr. Jeff Ubben, managing director of ValueAct Capital, is a member of our Board of Directors.  The repurchase of these shares was pre-approved by the Audit Committee and the Board of Directors with interested parties abstaining or not in attendance. 

At June 11, 2006, approximately 3.3 million shares remained authorized for repurchase.  The timing of our repurchases is subject to market conditions, cash availability, and blackout periods during which we are restricted from repurchasing shares.  There is no guarantee that shares authorized for repurchase by the Board will ultimately be repurchased.  Additionally, our Credit Agreement as amended on May 31, 2006 limits the amount of equity securities we can repurchase to $250 million (of which $166 million remains available for repurchase) plus a subsequent amount during any four consecutive quarters equal to our consolidated net income less dividends paid for the preceding four quarters. 

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On September 15, 2005, the Board of Directors authorized an increase in our quarterly cash dividend payable on our common stock from $.17 to $.18 per share.  Previously, in September 2004, the Board of Directors authorized an increase in the quarterly dividend rate from $0.15 per share to $0.17 per share and, in July 2003, the Board of Directors declared an increase in the quarterly dividend rate from $0.02 per share to $0.15 per share.  It is our intent to continue to pay dividends for the foreseeable future subject to, among other things, Board approval, cash availability, debt and line of credit restrictions and alternative cash needs.  At the current annual dividend rate of $0.72 per share, the aggregate annual dividend would be approximately $30 million.

We receive cash from the exercise of employee stock options.  Employee stock option exercises and ESPP purchases provided $43.6 million and $11.5 million of cash in fiscal 2006 and 2005, respectively.  Proceeds from the exercise of employee stock options will vary from period to period based upon, among other factors, fluctuations in the market value of our common stock relative to the exercise price of such options.

Financing Arrangements

Senior Credit Facility

On May 26, 2005, we entered into a three-year Credit Agreement ("Credit Agreement") that provides us with a $200 million senior revolving credit facility, subject to a $20 million sublimit for the issuance of standby and commercial letters of credit, a $10 million sublimit for swing line loans, and a $50 million alternative currency sublimit.  At our election and subject to lender approval, the amount available for borrowings under the Credit Agreement may be increased by an additional $50 million.  Funds are available under the Credit Agreement to finance permitted acquisitions, stock repurchases up to certain dollar limitations, and for other general corporate purposes.  The Company has three standby letters of credit totaling $2 million outstanding under the Credit Agreement.  Accordingly, although there were no borrowings outstanding under the Credit Agreement at March 31, 2006, only $198 million was available for borrowings. 

On May 31, 2006, we amended the Credit Agreement to permit the consummation of the sale of our Urology Business.  Additionally, the amendment modified the minimum Adjusted Consolidated EBITDA covenant that we are required to comply with under the terms of the Credit Agreement.  The amendment also amends certain negative covenants contained in the Credit Agreement, including amendments to the covenants restricting our ability to make investments and incur indebtedness and an amendment increasing the amount of our equity securities that we are permitted to repurchase.  As of June 11, 2006, there were no borrowings outstanding under the Credit Agreement.

Interest on borrowings (other than swing line loans and alternative currency loans) under the Credit Agreement is at a variable rate that is calculated, at our option, at the prime rate, or a Eurocurrency rate for deposits denominated in U.S. dollars plus an additional percentage that varies between 1.00% and 1.65%, depending on our senior leverage ratio at the time of the borrowing.  Swing line loans bear interest at the prime rate.  Alternative currency loans bear interest at the Eurocurrency rate for deposits denominated in the applicable currency plus the same additional percentage.  In addition, we paid certain fees to the lenders to initiate the Credit Agreement and will pay an unused commitment fee based on our senior leverage ratio and unborrowed lender commitments.

Borrowings under the Credit Agreement are guaranteed by certain of our domestic subsidiaries and are also secured by a pledge of 100% of the outstanding capital stock of certain of our other domestic subsidiaries.  In addition, if the ratio of total funded debt to adjusted earnings before interest, taxes, depreciation and amortization (or "adjusted EBITDA"), exceeds 2.50 to 1.00, then we are obligated to grant to the lenders a first priority perfected security interest in essentially all of our and our material domestic subsidiaries' assets.

The Credit Agreement imposes certain financial and operational restrictions, including financial covenants that require us to maintain a maximum consolidated funded debt leverage ratio of not greater than 4.00 to 1.00, a senior funded debt ratio of not greater than 2.50 to 1.00, a minimum quarterly adjusted EBITDA, and a minimum fixed charge ratio of greater than 1.25 to 1.00.  The covenants also restrict our ability, among other things, to make certain investments, incur certain types of indebtedness or liens, make acquisitions in excess of $20 million except in compliance with certain criteria, and repurchase shares of common stock, pay dividends or dispose of assets above specified thresholds.  The Credit Agreement also contains customary events of default, including payment defaults, material inaccuracies in our representations and warranties, covenant defaults, bankruptcy and involuntary proceedings, monetary judgment defaults in excess of specified amounts, cross-defaults to certain other agreements, change of control, and ERISA defaults.

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Other Financing

On October 4, 2005, Mentor Medical Systems B.V. ("Mentor BV"), a wholly-owned subsidiary of Mentor Corporation entered into a Loan and Overdraft Facility (the "Facility") with Cooperative RaboBank Leiden, Leiderdorp en Oestgstgeest U.A. ("RaboBank").

The Facility provides Mentor BV with an initial €15 million loan and overdraft facility, which decreases by €375,000 quarterly starting in September 2006.  Under the Facility, Mentor BV may borrow up to €12.5 million in fixed amount advances, with terms of three to six months, and a further sublimit of up to €5 million of loans in fixed amount advances with a term of up to 5 years.  Up to €10 million of the Facility may be drawn in the form of U.S. dollars.  Funds under the Facility are available to Mentor BV to finance certain dividend payments to Mentor Corporation and for other normal business purposes.  On March 31, 2006 we borrowed $14 million under the Facility to partially fund our repatriation of foreign earnings for reinvestment in the U.S. and this amount remains outstanding as of June 11, 2006.  Accordingly $14.0 million was outstanding and $4.2 million was available under this facility at March 31, 2006.

Interest on borrowings under the Facility is at a rate equal to 0.55% over the RaboBank base lending rate, Euribor, or LIBOR depending upon the currency and term of each borrowing.  Interest rates on borrowings other than overdrafts, are fixed for the term of the advance.

Borrowings by Mentor BV under the Facility are guaranteed by Mentor's wholly-owned subsidiary, Mentor Medical Systems C.V., through a Joint and Several Debtorship agreement.  In addition, borrowings under the Facility are secured by a mortgage on certain real estate owned by Mentor BV.

The Facility imposes certain financial and operational restrictions on Mentor BV, including financial covenants that require Mentor BV and Mentor Medical Systems CV to maintain a minimum combined defined solvency ratio, a maximum combined debt leverage ratio of not greater than 4 to 1, a senior funded debt ratio of not greater than 2.5 to 1, minimum quarterly operational results, and a minimum interest coverage ratio of greater than 5 to 1.  The Facility also contains customary events of default, including cross default and material or adverse change provisions.  If an event of default occurs, the commitments under the Facility may be terminated and the principal amount and all accrued but unpaid interest and other amounts owed thereunder may be declared immediately due and payable.  As of March 31, 2006, all covenants and restrictions had been satisfied.

Mentor BV paid €15,000 in certain fees to the RaboBank upon entry into the Facility, and Mentor BV will be obligated to pay, over the 10 year term of the Facility, a commitment fee of 0.25% of the committed and unborrowed balances.  Fees are payable quarterly in arrears. 

In addition to our RaboBank Facility, we previously established several lines of credit with local foreign lenders to facilitate operating cash flow needs at our foreign Urology subsidiaries.  These unsecured lines had no borrowings at year end and were terminated with the sale of our Urology segments on June 2, 2006.

At March 31, 2006, our total short-term borrowings under all lines of credit were $14.0 million and the weighted-average interest rate was 5.49%.  The total amount of additional borrowings available to us under all lines of credit was $202.2 million and $5.8 million at March 31, 2006 and 2005, respectively.  The increase in the amounts available from the prior year is primarily due to the addition of our new $200 million Senior Credit facility in May 2005. 

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Convertible Subordinated Notes

On December 22, 2003, we completed an offering of $150 million of convertible subordinated notes due January 1, 2024, pursuant to Rule 144A under the Securities Act of 1933.  The notes bear interest at 2¾% per annum and are convertible into shares of our common stock at an initial conversion price of $29.289 per share and are subordinated to all existing and future senior debt.  As a result of our recent dividend increase the conversion price has been adjusted to $29.167 and each $1,000 principle amount will be convertible into 34.2853 shares of common stock.   Concurrent with the issuance of the convertible subordinated notes, we entered into a convertible bond hedge and warrants transactions with respect to our common stock, the exposure for which is held by Credit Suisse First Boston LLC for a net cash payment of $18.5 million.  Both the bond hedge and the warrants transactions may be settled at our option either in cash or net shares and expire January 1, 2009.  The convertible bond hedge and warrants transactions combined are intended to reduce the potential dilution from conversion of the notes by effectively increasing the conversion price per share, from our perspective, to approximately $39.2633.

One of the conditions required for conversion of the notes was satisfied during the quarter ended March 31, 2006, and accordingly, the holders of notes have the option to convert the notes into common shares at the aforementioned adjusted conversion price per share.  The warrant holder also has the right to purchase 5.1 million shares when the share price of our common stock as quoted on the NYSE exceeds the current exercise price of $39.2633 per share.

Contractual Obligations and Commitments

The following table summarizes our significant contractual obligations and other commitments at March 31, 2006, and the effect such obligations are expected to have on our liquidity and cash flows in future periods.  Certain of the obligations shown below were assumed by Coloplast, the buyer of our Urology Business and thus are not contractual obligations for us subsequent to the close of the sale on June 2, 2006.   

	Payments Due by Period
(in thousands)			Less than		1-3		4-5		More than
Contractual Obligations	Total		1 Year		Years		Years		5 Years
Convertible notes	$	150,000	$	-	$	150,000	$	-	$	-
Operating lease obligations1	44,794		6,793		18,605		10,195		9,201
Purchase obligations2	16,429		16,429		-		-		-
Interest on debt	11,358		4,125		7,233		-		-
Lines of credit	14,000		14,000		-		-		-
Credit agreement (commitment fees)	1,152		443		519		76		114
Acquisition and other milestones3	1,000		1,000		-		-		-
Other long-term liabilities4	8,661		433		1,299		866		6,063
Total	$	247,394	$	43,223	$	177,656	$	11,137	$	15,378

1	On June 2, 2006, in connection with the sale of our Urology Business, our operating lease agreements relating to the Urology Business were assigned to Coloplast.  As a result, our future payments due under our outstanding lease agreements decreased by a total of $9.6 million ($2.0 million due in less than one year, $4.8 million due in one to three years, $2.1 million due in four to five years, and $0.7 million due in more than five years).
2	On June 2, 2006, also in connection with the sale of our Urology Business, our purchase obligations relating to the Urology Business were assigned to Coloplast.  As a result, our future payments due under our purchase obligations decreased by a total of $6.7 million.
3	On June 2, 2006, also in connection with the sale of our Urology Business, our acquisition and other milestones relating to the Urology Business were assigned to Coloplast.  As a result, our future payments due under our acquisition and other milestones decreased by a total of $1.0 million.
4	On June 2, 2006, also in connection with the sale of our Urology Business, our other long-term liabilities relating to the Urology Business were assigned to Coloplast.  As a result, our future payments due under our other long-term liabilities decreased by a total of $7.8 million ($0.4 due in less than one year, $1.2 million due in one to three years, $0.8 million due in four to five years, and $5.4 million due in more than five years).

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The nature of our business creates a need to enter into purchase obligations with suppliers.  In accordance with accounting principles generally accepted in the United States, these unconditional purchase obligations are not reflected in the accompanying consolidated balance sheets.  Inventory related and other purchase obligations do not exceed our projected requirements over the normal course of business. 

We enter into various product and intellectual property acquisitions and business combinations.  In connection with some of these activities, we agree to make payments to third parties when specific milestones are achieved, such as receipt of regulatory approvals or achievement of performance or operational targets. 

The expected timing of payment of the obligations discussed above is estimated based on current information.  Timing of payments and actual amounts paid may be different depending on the time of receipt of goods or services or changes to agreed-upon amounts for some obligations.  Amounts disclosed as contingent or milestone-based obligations are dependent on the achievement of the milestones or the occurrence of the contingent events and can vary significantly.

We do not have any off-balance sheet arrangements that are currently material or reasonably likely to be material to our financial position or results of operations.

We believe that funds generated from operations, our cash, cash equivalents and marketable securities, net after-tax proceeds from our sale of the Urology Business received subsequent to year end, plus funds available under our line of credit agreements will be adequate to meet our working capital needs and capital expenditure investment requirements and commitments for the foreseeable future.  However, it is possible that we may need to raise additional funds to finance unforeseen requirements or to consummate acquisitions of other businesses, products or technologies through the sale of equity or debt securities to the public or to selected investors, or by borrowing money from financial institutions.  In addition, even though we may not need additional funds in the short-term, we may still elect to sell additional equity or debt securities or borrow for other reasons.  There are no assurances that we will be able to obtain additional funds on terms that would be favorable to us, or at all.  If funds are raised by issuing additional equity securities or convertible debt securities, the ownership percentage of existing shareholders would be reduced.  In addition, equity or debt securities issued by us may have rights, preferences or privileges senior to those of our common stock.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

The following discussion about our market risks involves forward-looking statements.  Actual results could differ materially from those projected in the forward-looking statements.  We are exposed to market risk related to fluctuations in interest rates and foreign exchange rates.  We generally do not use derivative instruments.

Interest Rate Risk

We maintain a portfolio of highly liquid cash equivalents with maturities of three months or less from the date of purchase.  We also have current marketable securities, consisting primarily of tax exempt variable demand notes, government agency obligations, Federal Home Loan Bank and Mortgage Association bonds with maturities on or before March, 2007, and investment grade corporate obligations, including commercial paper that are of limited credit risk and have contractual maturities of less than two years.  Given the relative short-term nature of these investments, we do not expect to experience any material impact upon our results of operation as a result of changes to interest rates related to these investments.

On December 22, 2003, we completed an offering of $150 million of convertible subordinated notes due January 1, 2024 pursuant to Rule 144A under the Securities Act of 1933.  The notes bear interest at a fixed rate of 2¾% per annum.  Our subsidiaries also maintain certain levels of variable rate debt such as operating lines of credit.  The majority of our debt carries a fixed rate percentage and therefore is not subject to significant interest rate risk.  A 100 basis point change in interest rates would not have a material impact on our results of operations or financial condition related to the variable rate debt described

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Exchange Rate Risk

A portion of our operations consist of sales activities in foreign markets.  We manufacture our products primarily in the United States and Europe and sell them throughout the world through a combination of wholly owned sales offices and international distributors.  Sales to third-party distributors and to the wholly owned sales offices are transacted in U.S. dollars, Euros, British Pounds, and Canadian dollars.  Our foreign sales offices primarily invoice customers in their local currency.

As a result, our financial results could be significantly affected by factors such as changes in foreign currency exchange rates or weak economic conditions in the foreign markets mentioned.  The principal risk exposure we face results from fluctuation in foreign exchange rates.  We experience transactional exchange rate risk when one of our subsidiaries enter into transactions denominated in currencies other than their local currency.  In the last two fiscal years, the effect of exchange rate risk has been favorable upon our operating results and financial condition.  We do not currently hedge any of the foreign exchange rate exposures.  A significant and rapid change in foreign exchange rates could have a material adverse effect upon our results of operations.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The information required by this Item is submitted pursuant to Item 15 of this Annual Report on Form 10-K and incorporated herein by reference.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

ITEM 9A. CONTROLS AND PROCEDURES.

We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.  In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

We carried out an evaluation under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2006, the end of the period covered by this report.  Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of March 31, 2006.

Further, management has determined that, there have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended March 31, 2006 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

50

Management's Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934.  The Company's internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the U.S.  However, all internal control systems, no matter how well designed, have inherent limitations.  Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and reporting.

Management assessed the effectiveness of the Company's internal control over financial reporting as of March 31, 2006.  In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organization of the Treadway Commission (COSO) in Internal Control-Integrated Framework.  Based on our assessment, management believes that the Company maintained effective internal control over financial reporting as of March 31, 2006 based on those criteria.

Management's assessment of the effectiveness of the Company's internal control over financial reporting has been audited by Ernst & Young, LLP, an independent registered public accounting firm, as stated in their report appearing below, which expresses unqualified opinions on management's assessment and on the effectiveness of the Company's internal control over financial reporting as of March 31, 2006.

51

Report of Independent Registered Public Accounting Firm

on Internal Control Over Financial Reporting

The Board of Directors and Shareholders of Mentor Corporation

We have audited management's assessment, included in the accompanying Management's Report on Internal Control Over Financial Reporting, that Mentor Corporation (the "Company") maintained effective internal control over financial reporting as of March 31, 2006, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria).  The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting.  Our responsibility is to express an opinion on management's assessment and an opinion on the effectiveness of the company's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.  Our audit included obtaining an understanding of internal control over financial reporting, evaluating management's assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances.  We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.  A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, management's assessment that Mentor Corporation maintained effective internal control over financial reporting as of March 31, 2006, is fairly stated, in all material aspects, based on the COSO criteria.  Also, in our opinion, Mentor Corporation maintained, in all material respects, effective internal control over financial reporting as of March 31, 2006, based on the COSO criteria.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Mentor Corporation as of March 31, 2006 and 2005 and related consolidated statements of income, shareholders' equity and cash flows for each of the three years in the period ended March 31, 2006 and our report dated June 12, 2006 expressed an unqualified opinion thereon.

                                                                                                                /s/Ernst & Young LLP

Los Angeles, California

June 12, 2006

52

ITEM 9B. OTHER INFORMATION.

None.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

The information required by this Item with respect to our Executive Officers is set forth in Item 1, Business.  Other required information is hereby incorporated by reference to information under the heading "Election of Directors" in our Proxy Statement for the Annual Meeting of Shareholders to be filed with the Securities and Exchange Commission within 120 days of the close of the fiscal year ended March 31, 2006.

ITEM 11. EXECUTIVE COMPENSATION.

The information required by this Item is herein incorporated by reference to information under the heading "Executive Compensation and Other Information" in our Proxy Statement for the Annual Meeting of Shareholders to be filed with the Securities and Exchange Commission within 120 days of the close of the fiscal year ended March 31, 2006.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The information required by this Item is herein incorporated by reference to information under the heading "Ownership of Securities" in our Proxy Statement for the Annual Meeting of Shareholders to be filed with the Securities and Exchange Commission within 120 days of the close of the fiscal year ended March 31, 2006.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

The information required by this Item is herein incorporated by reference to information under the heading "Certain Transactions" in our Proxy Statement for the Annual Meeting of Shareholders to be filed with the Securities and Exchange Commission within 120 days of the close of the fiscal year ended March 31, 2006.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

The information required by this Item is herein incorporated by reference to information under the heading "Ratification of Independent Auditors" in our Proxy Statement for the Annual Meeting of Shareholders to be filed with the Securities and Exchange Commission within 120 days of the close of the fiscal year ended March 31, 2006.

53

PART IV

ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) (1)	Consolidated Financial Statements
	Report of Ernst & Young LLP, Independent Registered Public Accounting Firm
	Consolidated Balance Sheets as of March 31, 2006 and 2005
	Consolidated Statements of Income for the Years Ended March 31, 2006, 2005 and 2004
	Consolidated Statements of Changes in Shareholders' Equity for the Years Ended March 31, 2006, 2005 and 2004
	Consolidated Statements of Cash Flows for the Years Ended March 31, 2006, 2005 and 2004
	Notes to Consolidated Financial Statements
(a) (2)	Consolidated Financial Statement Schedules
	Schedule II - Valuation and Qualifying Accounts and Reserves
	All other schedules are omitted because they are not required, inapplicable, or the information is otherwise shown in the consolidated financial statements or notes thereto.
(a) (3)	Exhibits
	The information required by this item is incorporated by reference to the Exhibit Index in this report.

54

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

ON THE FINANCIAL STATEMENTS

The Board of Directors and Shareholders of Mentor Corporation

We have audited the accompanying consolidated balance sheets of Mentor Corporation as of March 31, 2006 and 2005, and the related consolidated statements of income, changes in shareholders' equity and cash flows for each of the three years in the period ended March 31, 2006.  Our audits also included the financial statement schedule listed in the Index at Item 15(a)(2).  These financial statements and schedule are the responsibility of the Company's management.  Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Mentor Corporation at March 31, 2006 and 2005, and the consolidated results of its operations and its cash flows for each of the three years in the period ended March 31, 2006, in conformity with U.S. generally accepted accounting principles.  Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of Mentor Corporation's internal control over financial reporting as of March 31, 2006, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated June 12, 2006 expressed an unqualified opinion thereon.

/s/ERNST & YOUNG LLP

Los Angeles, California
June 12, 2006

55

MENTOR CORPORATION
CONSOLIDATED BALANCE SHEETS
	March 31,
(in thousands)	2006		2005
Assets
Current assets:
Cash and cash equivalents	$	98,713	$		76,666
Marketable securities	102,241		36,228
Accounts receivable, net of allowance for doubtful accounts      of $4,616 in 2006 and $3,839 in 2005	58,199		57,218
Inventories	35,139		34,805
Deferred income taxes	21,764		20,045
Prepaid expenses and other	14,716		13,648
Current assets of discontinued operations	96,070		100,262
Total current assets	426,842		338,872
Property and equipment, net	36,448		36,971
Intangible assets, net	15,745		17,251
Goodwill, net	9,243		9,031
Other assets	8,310		10,099
Non-current assets of discontinued operations		60,264			65,882
Total assets	$	556,852	$		478,106
Liabilities and shareholders' equity
Current liabilities:
Account payable and accrued liabilities	$	97,144	$	79,998
Income taxes payable	1,837		2,281
Dividends payable	7,772		6,927
Short-term bank borrowings	14,000		970
Current liabilities of discontinued operations	29,971		36,298
Total current liabilities	150,724		126,474
Long-term accrued liabilities	18,984		15,385
Convertible subordinated notes	150,000		150,000
Non-current liabilities of discontinued operations	10,555		13,720
Commitments and contingencies
Shareholders' equity:
Common Stock, $.10 par value:
Authorized - 150,000,000 shares; issued and outstanding
43,176,495 shares in 2006;
40,745,626 shares in 2005;	4,318		4,075
Capital in excess of par value	36,726		8,419
Accumulated other comprehensive income	16,498		22,534
Retained earnings	169,047		137,499
Total shareholders' equity	226,589		172,527
Total liabilities and shareholders' equity	$	556,852	$		478,106
See notes to consolidated financial statements.

56

MENTOR CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
	Year Ended March 31,
(in thousands, except per share data)	2006		2005		2004
Net sales	$	268,272	$	251,726	$	218,437
Cost of sales	69,209		64,576		60,583
Gross Profit	199,063		187,150		157,854
Selling, general, and administrative	100,962		86,351		70,581
Research and development	29,036		25,234		21,067
Severance charges	-		8,519		-
Restructuring & long-lived asset impairment charges	-		1,665		-
	129,998		121,769		91,648
Operating income from continuing operations	69,065		65,381		66,206
Interest expense	(5,690)		(5,093)		(1,637)
Interest income	4,124		1,951		1,642
Other income	186		506		1,040
Income from continuing operations before income taxes	67,685		62,745		67,251
Income taxes	19,606		19,937		21,479
Income from continuing operations	48,079		42,808		45,772
Income from discontinued operations, net of income taxes	14,278		12,073		9,007
Net income	$	62,357	$	54,881	$	54,779
Basic earnings per share
Continuing operations	$	1.12	$	1.02	$	1.00
Discontinued operations	0.33		0.29		0.20
Basic earnings per share	$	1.45	$	1.31	$	1.20
Diluted earnings per share
Continuing operations	$	1.01	$	0.93	$	0.95
Discontinued operations	0.28		0.24		0.18
Diluted earnings per share	$	1.29	$	1.17	$	1.13
Dividends per share	$	0.71	$	0.66	$	0.47
Weighted average shares outstanding
Basic	42,995		41,921		45,543
Diluted *	50,870		49,667		49,272
See notes to consolidated financial statements.

* 2004 diluted earnings per share and weighted average shares outstanding have been restated to reflect the additional shares that would be issued upon conversion of our 2¾% convertible notes, in accordance with the adoption of  EITF 04-8 in the quarter ended December 2004.

57

MENTOR CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(in thousands, except per share data)	Common Shares Outstanding		Common Stock $.10 Par Value		Capital in Excess of Par Value		Deferred Compensation		Accumulated Other Comprehensive Income (Loss)			Retained Earnings		Total
Balance March 31, 2003		46,237	$	4,624	$	-	$	-	$	5,825		$	265,687	$	276,136
Comprehensive income:
Net income	-		-		-		-		-			54,779		54,779
Foreign currency        translation adjustment	-		-		-		-		10,890			-		10,890
Unrealized gain on        investments	-		-		-		-		107			-		107
Comprehensive income														65,776
Exercise of stock options	1,094		109		9,980		-		-			-		10,089
Income tax benefit arising   from the exercise of   stock options	-		-		5,406		-		-			-		5,406
Issuance of common   stock for the acquisition   of intangible assets	133		13		2,987		-		-			-		3,000
Convertible note hedge and   warrants	-		-		(7,741)		-		-			-		(7,741)
Repurchase of common   stock	(5,405)		(540)		(10,632)		-		-			(124,662)		(135,834)
Dividends declared   ($.47 per share)	-		-		-		-		-			(20,828)		(20,828)
Balance March 31, 2004		42,059	$	4,206	$	-	$	-	$	16,822		$	174,976	$	196,004
Comprehensive income:
Net income	-		-		-		-		-			54,881		54,881
Foreign currency        translation adjustment	-		-		-		-		5,887			-		5,887
Unrealized loss on        investments	-		-		-		-		(175)			-		(175)
Comprehensive income														60,593
Exercise of stock options	1,028		103		11,435		-		-			-		11,538
Acceleration of options	-		-		4,405		-		-			-		4,405
Income tax benefit arising   from the exercise of   stock options	-		-		7,184		-		-			-		7,184
Repurchase of common   stock	(2,341)		(234)		(14,605)		-		-			(64,934)		(79,773)
Dividends declared   ($.66 per share)	-		-		-		-		-			(27,424)		(27,424)
Balance March 31, 2005		40,746	$	4,075	$	8,419	$	-	$		22,534	$	137,499	$	172,527
(continued on next page)

58

MENTOR CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (continued)
(in thousands, except per share data)	Common Shares Outstanding		Common Stock $.10 Par Value		Capital in Excess of Par Value		Deferred Compensation		Accumulated Other Comprehensive Income (loss)		Retained Earnings		Total
Balance March 31, 2005		40,746	$	4,075	$	8,419	$	-	$	22,534	$	137,499	$	172,527
Comprehensive income:
Net income	-		-		-		-		-		62,357		62,357
Foreign currency        translation adjustment	-		-		-		-		(6,157)		-		(6,157)
Change in unrealized loss        on investments	-		-		-		-		121		-		121
Comprehensive income													56,321
Exercise of stock options	3,147		315		43,334		-		-		-		43,649
Income tax benefit arising   from the exercise of   stock options	-		-		26,267		-		-		-		26,267
Issuance of restricted stock	289		29		15,197		(15,226)		-		-		-
Forfeiture of restricted stock	(10)		(1)		(510)		511		-		-		-
Amortization of restricted   grants	-		-		-		1,471		-		-		1,471
Repurchase of common   stock	(996)		(100)		(42,737)		-		-		-		(42,837)
Dividends declared   ($.71 per share)	-		-		-		-		-		(30,809)		(30,809)
Balance March 31, 2006		43,176	$	4,318	$	49,970	$	(13,244)	$	16,498	$	169,047	$	226,589
See notes to consolidated financial statements.

59

MENTOR CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
	Year Ended March 31,
(in thousands)	2006		2005		2004
Operating Activities:
Income from continuing operations	$	48,079	$	42,808	$	45,772
Adjustments to derive cash flows from continuing operating activities:
Depreciation	7,748		7,296		6,559
Amortization	2,274		1,977		955
Deferred income taxes	793		(2,259)		(6,536)
Non-cash compensation	1,471		4,406		-
Tax benefit from exercise of stock options	26,267		7,184		5,406
Non-cash impairment of long-lived assets	-		186		10
Loss (gain) on sale of assets	303		654		-
Loss on long-term marketable securities and investment     write-downs, net	121		20		97
Changes in operating assets and liabilities:
Accounts receivable	(2,136)		(2,854)		(13,459)
Inventories and other current assets	(4,402)		(5,790)		1,421
Accounts payable and accrued liabilities	19,618		9,988		20,903
Income taxes payable	(1,092)		(1,025)		1,094
Net cash provided by continuing operating activities	99,044		62,591		62,222
Net cash provided by discontinued operating activities	25,354		34,509		11,792
Net cash provided by operating activities	124,398		97,100		74,014
Investing Activities:
Purchases of property and equipment	(8,531)		(6,868)		(11,201)
Purchases of intangibles	(1,543)		(507)		(553)
Purchases of marketable securities	(295,439)		(150,720)		(34,538)
Sales of marketable securities	229,461		122,855		27,813
Acquisitions, net of cash acquired	-		-		(11,420)
Other, net	-		208		(3)
Net cash used for continuing investing activities	(76,052)		(35,032)		(29,902)
Net cash used for discontinued investing activities	(5,164)		(2,750)		(15,324)
Net cash used for investing activities	(81,216)		(37,782)		(45,226)
Financing Activities:
Issuance of convertible notes, net of issuance costs	-		-		126,305
Sale of warrants	-		-		11,891
Repurchase of common stock	(42,837)		(79,773)		(135,755)
Proceeds from exercise of stock options and ESPP	43,649		11,539		10,089
Dividends paid	(29,964)		(26,806)		(20,829)
Borrowings under line of credit agreements	14,000		-		3
Repayments under line of credit agreements	(970)		(4,854)		-
Deferred tax on investment	-		-		(9,503)
Net cash used for continuing financing activities	(16,122)		(99,894)		(17,799)
Net cash used for (provided by) discontinued financing activities	(2,213)		(1,976)		703
Net cash used for financing activities	(18,335)		(101,870)		(17,096)
Effect of currency exchange rates on cash and cash equivalents	(780)		648		293
Effect of currency exchange rates of discontinued operations	(2,020)		345		400
Increase (decrease) in cash and cash equivalents	22,047		(41,559)		12,385
Cash and cash equivalents at beginning of year	76,666		118,225		105,840
Cash and cash equivalents at end of year	$	98,713	$	76,666	$	118,225
Supplemental cash flow information
Cash paid during the year for:
Income taxes for continuing operations	$	4,601	$	20,325	$	23,804
Interest for continuing operations	$	4,522	$	4,015	$	289
See notes to consolidated financial statements.

 

60

MENTOR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2006

Note A - Summary of Significant Accounting Policies

Business Activity

Mentor Corporation was incorporated in April 1969.  Unless the context indicates otherwise, when we refer to "Mentor," "we," "us," "our," or the "Company" in these notes, we are referring to Mentor Corporation and its subsidiaries on a consolidated basis.  The Company develops, manufactures and markets a range of products serving the aesthetic medicine market, including plastic and reconstructive surgery.  Historically the Company's products have been utilized by three primary segments: aesthetic and general surgery (plastic and reconstructive surgery), surgical urology, and clinical and consumer healthcare.  Aesthetic and general surgery products include surgically implantable prostheses for plastic and reconstructive surgery, capital equipment and consumables used for soft tissue aspiration or body contouring (liposuction), and facial aesthetics products.  On June 2, 2006, the Company completed a transaction for the sale of our surgical urology and clinical and consumer healthcare businesses to Coloplast A/S ("Coloplast").  The surgical urology products included surgically implantable prostheses for the treatment of impotence, surgically implantable incontinence products, urinary care products, and brachytherapy seeds for the treatment of prostate cancer.  The clinical and consumer healthcare products included catheters and other products for the management of urinary incontinence and retention. 

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and all of its subsidiaries in which a controlling interest is maintained.  For those subsidiaries where the Company owns less than 100%, the outside shareholders' interests are treated as minority interests.  All intercompany accounts and transactions have been eliminated.  Certain prior year amounts in previously issued financial statements have been reclassified to conform to the current year presentation.

Cash Equivalents and Marketable Securities

All highly liquid investments with maturities of three months or less at the date of purchase are considered to be cash equivalents.

The Company considers its marketable securities available-for-sale as defined in SFAS No. 115, "Accounting for Certain Investments in Debt and Equity Securities."  Realized gains and losses, and declines in value considered to be other than temporary, are included in income.  The cost of securities sold is based on the specific identification method.  Available-for-sale securities are reported at fair market value.  Unrealized gains and losses are excluded from income, but, instead are reported as a net amount in Accumulated Other Comprehensive Income in Shareholders' Equity.  The Company's short-term marketable securities consist primarily of state and municipal government and government agency obligations, Federal Home Loan Bank and Mortgage Association bonds, and investment grade corporate obligations, including commercial paper. 

61

Available-for-sale investments at March 31, 2006 were as follows:

			Gross		Gross		Estimated
	Adjusted		Unrealized		Unrealized		Fair
(in thousands)	Cost		Gains		Losses		Value
Cash balances	$	95,054	$	-	$	-	$	95,054
Money market funds	3,659		-		-			3,659
State and Municipal agency obligations	71,374		-		-			71,374
Mortgage-backed securities	30,667		-		(85)			30,582
Corporate debt securities	286		-		(1)			285
Total available-for-sale investments	$	201,040	$	-	$	(86)	$	200,954
Included in cash and cash equivalents	$	98,713	$	-	$	-	$	98,713
Included in current marketable securities	102,327		-		(86)			102,241
Total available-for-sale investments	$	201,040	$	-	$	(86)	$	200,954

Available-for-sale investments at March 31, 2005 were as follows:

			Gross		Gross		Estimated
	Adjusted		Unrealized		Unrealized		Fair
(in thousands)	Cost		Gains		Losses		Value
Cash balances	$	68,598	$	-	$	-	$	68,598
Money market mutual funds	8,068		-		-		8,068
Marketable equity securities	161		-		(18)		143
U.S., State and Municipal agency obligations	36,149		-		(342)		35,807
Corporate debt securities	278		-		-		278
Total available-for-sale investments	$	113,254	$	-	$	(360)	$	112,894
Included in cash and cash equivalents	$	76,666	$	-	$	-	$	76,666
Included in current marketable securities	36,588		-		(360)		36,228
Total available-for-sale investments	$	113,254	$	-	$	(360)	$	112,894

Concentrations and Credit Risk

The Company obtains certain raw materials and components for a number of its products from single suppliers.  In most cases the Company's sources of supply could be replaced if necessary without undue disruption, but it is possible that the process of qualifying new materials and/or vendors for certain raw materials and components could cause a material interruption in manufacturing or sales.  No material interruptions in raw material supply occurred during fiscal 2006.

The Company grants credit terms in the normal course of business to its customers, primarily hospitals, doctors and distributors.  The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and the customers' current credit worthiness, as determined through review of their current credit information.  The Company regularly monitors collections and payments from customers and maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments.  Estimated losses are based on historical experience and any specific customer collection issues identified.  Bad debts have been minimal.  The Company does not normally require collateral or other security to support credit sales.  No customer accounted for more than 10% of the Company's revenues or accounts receivable balance for any periods presented.

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Revenue Recognition

The Company recognizes product revenue, net of discounts, returns, and rebates in accordance with Statement of Financial Accounting Standards ("SFAS") No. 48, "Revenue Recognition When the Right of Return Exists," and Staff Accounting Bulletin ("SAB") No. 104, "Revenue Recognition."  As required by these standards, revenue is recorded when persuasive evidence of a sales arrangement exists, delivery has occurred, the buyer's price is fixed or determinable, contractual obligations have been satisfied, and collectibility is reasonably assured.  These requirements are met, and sales and related cost of sales are recognized upon the shipment of products, or in the case of consignment inventories, upon the notification of usage by the customer.  The Company records estimated reductions to revenue for customer programs and other volume-based incentives.  Should the actual level of customer participation in these programs differ from those estimated, additional adjustments to revenue may be required.  The Company also allows credit for products returned within its policy terms.  The Company records an allowance for estimated returns at the time of sale based on historical experience, recent gross sales levels and any notification of pending returns.  Should the actual returns differ from those estimated, additional adjustments to revenue and cost of sales may be required.

The Company has current and long term deferred revenue, which include funds received in connection with purchases of the Company's Enhanced Advantage Breast Implant Limited Warranty program.  The fees received in connection with the Enhanced Advantage Breast Implant Limited Warranty are deferred and recognized evenly over the life of the warranty term.

Inventories

Inventories are stated at the lower of cost or market, cost determined by the first-in, first-out ("FIFO") method.  The Company writes down its inventory for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions.

Property and Equipment

Property and equipment is stated at cost.  Depreciation is based on the useful lives of the properties and computed using the straight-line method.  Buildings are depreciated over 30 years, furniture and equipment over 3 to 10 years and leasehold improvements over the shorter of their estimated useful lives ranging from 3 to 15 years or lease term.  Significant improvements and betterments are capitalized while maintenance and repairs are charged to operations as incurred.

Intangible Assets and Goodwill

Intangible assets consist of values assigned to patents, licenses, trademarks and other intangibles.  These are stated at cost less accumulated amortization and are amortized over their economic useful life ranging from 3 to 20 years using the straight-line method.  Goodwill, the excess purchase cost over fair value of net identifiable assets acquired, was amortized using the straight-line method in fiscal 2002.  Goodwill amortization was discontinued in fiscal 2003 in accordance with SFAS No. 142, Goodwill and Other Intangible Assets.  As required by SFAS No. 142, the Company has reassessed the remaining amortization periods of intangible assets acquired on or before June 30, 2001 and assigned all goodwill to reporting units for impairment testing.  The impairment tests involved the use of both estimates of fair value for the Company's reporting units as well as discounted cash flow assumptions.  If the book value exceeds the fair value, then the net book value would then be reduced to fair value based on an estimate of discounted cash flow.

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Warranty Reserves

The Company offer two types of warranties relating to its breast implants in the United States, Canada, and Puerto Rico: a standard limited warranty which is offered at no additional charge and an enhanced limited warranty at an additional charge of $100 in the U.S. ($100 CAD in Canada), which provide limited financial assistance in the event of a deflation or rupture.  The Company's standard limited warranty is also offered in certain European and other international countries for silicone gel-filled breast implants.  The Company provides an accrual for the estimated cost of breast implant warranties at the time revenue is recognized.  Costs related to warranties are recorded in cost of sales.  The estimated cost of the standard limited warranty is recorded as an expense at the time of sale, whereas the estimated cost of the enhanced limited warranty is deferred and recognized over the term of the enhanced limited warranty which approximates costs as incurred.  Such accruals are based on estimates, which are based on relevant factors such as unit sales, historical experience, the limited warranty period, estimated costs, and, to a limited extent, information developed by the Company's insurance company using actuarial techniques.  These accruals are analyzed periodically for adequacy.  While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of the Company's component suppliers, the warranty obligation is affected by reported rates of warranty claims and levels of financial assistance specified in the limited warranties.  Should actual patient claim rates reported differ from the Company's estimates, adjustments to the estimated warranty liability may be required.  These adjustments would be included in cost of sales.

Product Liability Reserves

The Company has product liability reserves for product-related claims to the extent those claims may result in litigation expenses, settlements or judgments within our self-insured retention limits.  The Company has also established additional reserves, through its wholly-owned captive insurance company, for estimated liabilities for product-related claims based on actuarially determined estimated liabilities taking into account its excess insurance coverages.  The actuarial valuations are based on historical information and certain assumptions about future events.  Product liability costs are recorded in selling, general and administrative expenses as they are directly under the control of our General Counsel and other general and administrative staff and are directly impacted by the Company's overall risk management strategy.  Should actual product liability experience differ from the estimates and assumptions used to develop these reserves, subsequent changes in reserves will be recorded in selling, general and administrative expenses, and may affect the Company's operating results in future periods. 

Income Taxes

Deferred income taxes are provided on the temporary differences between income for financial statement and tax purposes.  The Company has not recorded a valuation allowance on its deferred tax assets as management believes that it is more likely than not that all deferred tax assets will be realized.

Advertising Expenses

The Company expenses media advertising costs as incurred or where applicable, upon first showing.  Advertising expenses were $1.4 million, $3.9 million and $0.5 million in fiscal 2006, 2005 and 2004, respectively.  Capitalized advertising costs  were $0, $1.1 million  and $0 as of March 31, 2006, 2005 and 2004, respectively. 

Foreign Operations

Export sales to independent distributors, were $7.2 million, $6.5  million and $5.2 million in fiscal 2006, 2005 and 2004, respectively.  In addition, $68.3 million, $58.8 million, and $49.8 million of net sales from continuing operations in fiscal 2006, 2005 and 2004, respectively, were from the Company's direct international sales offices primarily in Canada and Western Europe.  Income from continuing operations before income taxes for foreign operations was $21.4 million, $16.3 million and $8.9 million for fiscal 2006, 2005 and 2004, respectively. 

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Foreign Currency Translation

The financial statements of the Company's non-U.S. subsidiaries are translated into U.S. dollars in accordance with SFAS No. 52, "Foreign Currency Translation."  The assets and liabilities of certain non-U.S. subsidiaries whose functional currencies are other than the U.S. dollar are translated at current rates of exchange.  Revenue and expense items are translated at the average exchange rate for the year.  The resulting translation adjustments are recorded directly into accumulated other comprehensive income (loss).  Transaction gains and losses, other than intercompany debt deemed to be of a long-term nature, are included in net income in the period they occur. 

Effects of Recent Accounting Pronouncements

In February 2006, the Financial Accounting Standards Board ("FASB") issued SFAS No. 155, Accounting for Certain Hybrid Financial Instruments - an amendment of FASB Statements No. 133 and 140 ("SFAS 155").  This statement amends SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities ("SFAS 133"), and SFAS No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, and resolves issues addressed in SFAS 133 Implementation Issue No. D1, "Application of Statement 133 to Beneficial Interest in Securitized Financial Assets."  This Statement: (a) permits fair value remeasurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation; (b) clarifies which interest-only strips and principal-only strips are not subject to the requirements of SFAS 133; (c) establishes a requirement to evaluate beneficial interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation; (d) clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives; and (e) eliminates restrictions on a qualifying special-purpose entity's ability to hold passive derivative financial instruments that pertain to beneficial interests that are or contain a derivative financial instrument.  The standard also requires presentation within the financial statements that identifies those hybrid financial instruments for which the fair value election has been applied and information on the income statement impact of the changes in fair value of those instruments.  The Company is required to apply SFAS 155 to all financial instruments acquired, issued or subject to a remeasurement event beginning January 1, 2007, although early adoption is permitted as of the beginning of an entity's fiscal year.  The Company is evaluating the provisions of SFAS 155.  The effects of adopting of SFAS 155 on the Company's financial statements are not known at this time.

In June 2005, the FASB ratified Emerging Issues Task Force ("EITF") Issue 05-6, "Determining the Amortization Period for Leasehold Improvements." EITF Issue 05-6 requires that leasehold improvements purchased subsequent to the inception of the lease or acquired in a business combination be amortized over the lesser of the useful life of the assets or a lease term that includes renewals that are reasonably assured at the date of the purchase or business combination.  The guidance in Issue 05-6 was effective as of the beginning of the third quarter of Fiscal 2006.  Adoption of EITF Issue 05-6 did not have a material effect on the Company's financial position or results of operations.

In May 2005, the FASB issued SFAS No. 154, Accounting Changes and Error Corrections, which replaces APB Opinion No. 20, Accounting Changes and SFAS No. 3, Reporting Accounting Changes in Interim Financial Statements.  This pronouncement applies to all voluntary changes in accounting principle, and revises the requirements for accounting for, and reporting a change in, accounting principle.  SFAS No. 154 requires retrospective application to prior periods' financial statements of a voluntary change in accounting principle, unless it is impracticable to do so.  This pronouncement also requires that a change in the method of depreciation, amortization, or depletion for long-lived, non-financial assets be accounted for as a change in accounting estimate that is affected by a change in accounting principle.  SFAS No. 154 retains many provisions of APB Opinion 20 without change, including those related to reporting a change in accounting estimate, a change in the reporting entity, and correction of an error.  The pronouncement also carries forward the provisions of SFAS No. 3, which govern reporting accounting changes in interim financial statements.  SFAS No. 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005.  The Statement does not change the transition provisions of any existing accounting pronouncements, including those that are in a transition phase as of the effective date of SFAS No. 154.  The Company has applied the provisions of this statement effective April 1, 2006.

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In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based Payment," ("SFAS 123(R)").  SFAS 123(R) replaces FASB Statement No. 123, Accounting for Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees.  SFAS 123(R) covers a wide range of share-based compensation arrangements and requires that the compensation cost related to these types of payment transactions be recognized in financial statements.  Cost will be measured based on the fair value of the equity or liability instruments issued.

In March 2005, the Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin ("SAB") No. 107, which provides guidance regarding the application of SFAS 123(R).  SAB No. 107 expresses views of the Staff regarding the interaction between SFAS 123(R), Share-Based Payment, and certain SEC rules and regulations, and provides the Staff's views regarding the valuation of share-based payment arrangements for public companies.  In particular, SAB No. 107 provides guidance related to share-based payment transactions with nonemployees, the transition from nonpublic to public entity status, valuation methods (including assumptions such as expected volatility and expected term), the accounting for certain redeemable financial instruments issued under share-based payment arrangements, the classification of compensation expense, non-GAAP financial measures, first-time adoption of SFAS 123(R) in an interim period, capitalization of compensation cost related to share-based payment arrangements, the accounting for income tax effects of share-based payment arrangements upon adoption of SFAS 123(R), the modification of employee share options prior to adoption of SFAS 123(R), and disclosures in Management's Discussion and Analysis subsequent to adoption of SFAS 123(R).

On April 14, 2005, the SEC approved a new rule that delays the effective date for SFAS 123(R) to fiscal years beginning after June 15, 2005, thereby rendering it effective as to the Company on April 1, 2006.  The adoption of SFAS 123(R) on April 1, 2006 is expected to have a material impact on the Company's consolidated net income and earnings per share.  The Company has not completed its analysis of the impact of the adoption of 123(R); however, the effect of the adoption is estimated to approximate that shown in Note G, "Stock Options, Restricted Stock and Employee Stock Purchase Plan" in the Notes to Consolidated Financial Statements, plus the impact of  future grants and awards, if any. 

In November 2004, the FASB issued Statement No. 151, Inventory Costs, which amends the guidance in Accounting Review Board ("ARB") No. 43, Chapter 4, Inventory Pricing.  This amendment clarifies the accounting for abnormal amounts of idle facility expense, freight, handling costs and wasted material (spoilage).  This Statement requires that those items be recognized as current-period charges, regardless of whether they meet the criteria specified in ARB 43 of "so abnormal".  In addition, this Statement requires that allocation of fixed production overheads to the costs of conversion be based on normal capacity of the production facilities.  This Statement is effective for fiscal years beginning after June 15, 2005, thereby rendering it effective as to the Company on April 1, 2006.  The adoption of SFAS No. 151 is not expected to have a material impact on the results of operations or the financial position of the Company.

In September 2004, the FASB confirmed EITF Issue No. 04-8, "The Effect of Contingently Convertible Debt on Diluted Earnings per Share," with an effective date of December 15, 2004.  The EITF reflects the Task Force's conclusion that contingently convertible debt should be included in diluted earnings per share calculations, regardless of whether or not the trigger price has been reached.  The Company adopted EITF 04-8 in the quarter ended December 31, 2004 and retroactively applied its provisions to the interim periods ending June 30 and September 30, 2004 due to the Company's December 2003 issuance of convertible subordinated notes.  The impact of the EITF 04-8 changed the diluted earnings per share calculation by increasing net income used in the numerator by the after-tax amount of interest expense related to the convertible notes (approximately $802,000 per quarter), and by increasing weighted average shares outstanding used in the denominator by approximately 5.1 million shares, the number of shares to be issued upon full conversion of the convertible notes.  The effect of the restatement was a decrease in diluted earnings per share of approximately $0.02 per share for the interim periods ending June 30 and September 30, 2004.

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Use of Estimates

Financial statements prepared in accordance with accounting principles generally accepted in the United States require management to make estimates and judgments that affect amounts and disclosures reported in the financial statements.  Actual results could differ from those estimates.

Note B - Inventories

Inventories at March 31 consisted of:

(in thousands)	2006		2005
Raw materials	$	3,994	$	5,633
Work in process	5,382		5,482
Finished goods on consignment	10,800		11,262
Finished goods	14,963		12,428
	$	35,139	$	34,805

Note C - Property and Equipment

Property and equipment at March 31 consisted of:

(in thousands)	2006		2005
Land	$	55	$	55
Buildings	10,053		10,606
Leasehold improvements	21,952		19,149
Furniture, fixtures and equipment	60,004		57,111
Construction in progress	3,481		3,236
	95,545		90,157
Less accumulated depreciation and amortization	(59,097)		(53,186)
	$	36,448	$	36,971

Note D - Other Comprehensive Income

Other comprehensive income includes the net change in unrealized gains (losses) on available-for-sale securities as follows:

	Year Ended March 31,
(in thousands)	2006		2005		2004
Unrealized gains (losses) arising during period,    net of taxes of $217, $137 and $8, respectively	$	(403)	$	(386)	$	14
Reclassification adjustments for gains (losses)    realized in net income, net of taxes of $282,    $115 and $50, respectively	524		211		93
Change in net unrealized gains (losses) on securities	$	121	$	(175)	$	107

Accumulated other comprehensive income which is included in the Company's shareholders' equity at March 31 consisted of:

(in thousands)	2006		2005
Net unrealized (losses) gains on securities	$	(59)	$	(180)
Foreign currency translation adjustments	16,557		22,714
Accumulated other comprehensive income	$	16,498	$	22,534

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Note E - Accounts Payable and Accrued Liabilities and Long-Term Accrued Liabilities

Accounts payable and accrued liabilities at March 31 consisted of:

(in thousands)	2006		2005
Trade accounts payable	$	27,685	$	20,923
Accrued compensation	17,335		14,335
Sales returns	15,544		13,162
Deferred revenue	10,495		9,546
Product liability reserve	6,701		5,232
Warranty reserves	4,260		3,860
Interest payable	1,031		1,084
Accrued royalties	274		449
Other	13,819		11,407
	$	97,144	$	79,998

Long-term accrued liabilities at March 31 consisted of:

(in thousands)	2006		2005
Warranty reserves	$	18,090	$	15,385
Other	894		-
	$	18,984	$	15,385

Note F - Short-Term Bank Borrowings

Credit Agreement

On May 26, 2005, the Company entered into a Credit Agreement (the "Credit Agreement") that provides a $200 million senior revolving credit facility, subject to a $20 million sublimit for the issuance of standby and commercial letters of credit, a $10 million sublimit for swing line loans and a $50 million alternative currency sublimit.  The Credit Agreement expires on September 30, 2008.  At the election of the Company, and subject to lender approval, the amount available for borrowings under the Credit Agreement may be increased by an additional $50 million.  Funds under the Credit Agreement are available to the Company to finance permitted acquisitions, for stock repurchases up to certain dollar limitations, and for other general corporate purposes.  The Company has three standby letters of credit totaling $2 million outstanding which are secured by the Credit Agreement.  Accordingly, although there were no borrowing outstanding under the Credit Agreement at March 31, 2006, only $198 million was available for borrowings. 

Interest on borrowings (other than swing line loans) under the Credit Agreement is at a variable rate that is calculated, at the Company's option, at either prime rate or LIBOR, plus an additional percentage that varies depending on the Company's senior leverage ratio (as defined in the Credit Agreement) at the time of the borrowing.  Swing line loans bear interest at the prime rate plus additional basis points, depending on the Company's senior leverage ratio at the time of the loan.  In addition, the Company paid certain fees to the lenders to initiate the Credit Agreement and will pay an unused commitment fee based on the Company's senior leverage ratio and unborrowed lender commitments.

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Borrowings under the Credit Agreement are guaranteed by two of the Company's domestic subsidiaries and are also secured by a pledge of 100% of the outstanding capital stock of two other domestic subsidiaries and by 65% of the outstanding capital stock of our French subsidiary.  In addition, if the ratio of total funded debt to adjusted EBITDA exceeds 2.50 to 1.00, the Company is obligated to grant to the lenders a first priority perfected security interest in essentially all of its domestic assets.

The Credit Agreement imposes certain financial and operational restrictions on the Company and its subsidiaries, including financial covenants that require the Company to maintain a maximum consolidated funded debt leverage ratio of not greater than 4.00 to 1.00, a senior funded debt ratio of not greater than 2.50 to 1.00, minimum quarterly EBITDA and a minimum fixed charge ratio of greater than 1.25 to 1.00.  The covenants also restrict the Company's ability, among other things, to make certain investments, incur certain types of indebtedness or liens, make acquisitions in excess of $20 million except in compliance with certain criteria, and repurchase shares of common stock, pay dividends or dispose of assets above specified thresholds.  The Credit Agreement also contains customary events of default, including payment defaults, material inaccuracies in its representations and warranties, covenant defaults, bankruptcy and involuntary proceedings, monetary judgment defaults in excess of specified amounts, cross-defaults to certain other agreements, change of control, and ERISA defaults.  If an event of default occurs and is continuing, the commitments under the Credit Agreement may be terminated and the principal amount and all accrued but unpaid interest and other amounts owed thereunder may be declared immediately due and payable.  As of March 31, 2006, all covenants and restrictions had been satisfied, and there were no borrowings outstanding under the Credit Agreement. 

Loan and Overdraft Facility

On October 4, 2005, Mentor Medical Systems B.V., ("Mentor BV"), a wholly-owned subsidiary of Mentor Corporation entered into a Loan and Overdraft Facility (the "Facility") with Cooperative RaboBank Leiden, Leiderdorp en Oestgstgeest U.A. ("RaboBank").

The Facility provides Mentor BV with an initial €15 million loan and overdraft facility, which decreases by €375,000 quarterly starting in September 2006.  Under the Facility, Mentor BV may borrow up to €12.5 million in fixed amount advances, with terms of three to six months, and a further sublimit of up to €5 million of loans in fixed amount advances with a term of up to 5 years.  Up to €10 million of the Facility may be drawn in the form of U.S. Dollars.  Funds under the Facility are available to Mentor BV to finance certain dividend payments to Mentor Corporation and for other normal business purposes.  As of June 11, 2006, $14.0 million was outstanding under the Facility.

Interest on borrowings under the Facility is at a rate equal to 0.55% over the RaboBank base lending rate, Euribor, or LIBOR depending upon the currency and term of each borrowing.  Interest rates on borrowings other than overdrafts, are fixed for the term of the advance.

Borrowings by Mentor BV under the Facility are guaranteed by Mentor's wholly-owned subsidiary, Mentor Medical Systems C.V., through a Joint and Several Debtorship agreement.  In addition, borrowings under the Facility are secured by certain real estate owned by Mentor BV.

The Facility imposes certain financial and operational restrictions on Mentor BV, including financial covenants that require Mentor BV and Mentor Medical Systems CV to maintain a minimum combined defined solvency ratio, a maximum combined debt leverage ratio of not greater than 4 to 1, a senior funded debt ratio of not greater than 2.5 to 1, minimum quarterly operational results, and a minimum interest coverage ratio of greater than 5 to 1.  The Facility also contains customary events of default, including cross default and material or adverse change provisions.  If an event of default occurs, the commitments under the Facility may be terminated and the principal amount and all accrued but unpaid interest and other amounts owed thereunder may be declared immediately due and payable.  As of March 31, 2006, all covenants and restrictions were satisfied.

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Mentor BV paid €15,000 in certain fees to the RaboBank upon entry into the Facility, and Mentor BV will be obligated to pay, over the 10 year term of the Facility, a commitment fee of 0.25% of the committed and unborrowed balances.  Fees are payable quarterly in arrears.

Outstanding borrowings under all credit arrangements had a weighted-average interest rate of 5.49% and 2.85% at March 31, 2006 and 2005, respectively.  A total of $202.2 million was available under the senior revolving credit facility and foreign lines of credit at March 31, 2006 and $5.8 million was available under the foreign lines of credit at March 31, 2005. 

Note G - Stock Options, Restricted Stock and Employee Stock Purchase Plan

The Company's Long-Term Incentive Plans

The Company has granted options to key employees and non-employee directors under its Amended 2000 Long-Term Incentive Plan (the "2000 Plan") and its 1991 Plan.  In addition, in September 2005, the Company's shareholders approved an amended and restated version of the Company's Amended 2000 Long-Term Incentive Plan, which is now referred to as the Mentor Corporation 2005 Long-Term Incentive Plan and which was further amended in November 2005 (as amended, the "2005 Plan").  The 2005 Plan does not provide for an increase in the number of shares of the Company's common stock available for award grants under the plan.  Options granted under each of the Company's plans vest in four equal annual installments beginning one year from the date of grant, and expire ten years from the date of grant.  At March 31, 2006, the Company had one plan under which stock options were available for future grants, the 2005 Plan.  Pursuant to the terms of the option plans, 3,161,517 common shares were issued pursuant to exercises during fiscal 2006. 

The 2005 Plan reflects, among other things, amendments to the earlier plans to: (i) provide the Company with flexibility to grant awards other than stock options, including but not limited to restricted stock, stock bonuses, stock units and dividend equivalents; (ii) allow the Company to grant awards intended to qualify as performance-based compensation within the meaning of Section 162(m) of the U.S. Internal Revenue Code; and (iii) extend the term of the plan to July 24, 2015.  Following the November 2005 amendments, the 2005 Plan provides as follows:

Grants of full-value awards under the 2005 Plan generally must satisfy certain minimum vesting requirements.  ("Full-value awards" include all awards granted under the 2005 Plan other than stock options with an exercise price that is not less than the fair market value of the underlying stock on the date the option is granted.)  Full-value awards subject to time-based vesting may not become fully vested in less than three years.  Full-value awards subject to performance-based vesting may not vest in less than one year.  The Company retains discretion to accelerate vesting of such awards under certain circumstances such as in connection with a termination of the grantee's employment, a change in control of the Company or the grantee's employer, or a release of claims by the grantee.  The Company may also grant full-value awards covering up to 10% of the total number of shares available for grant purposes under the 2005 Plan that are not subject to the foregoing vesting and acceleration restrictions.

Shareholder approval is expressly required for any increase in the number of shares of the Company's common stock that are available for award grant purposes under the 2005 Plan.

Persons eligible to receive awards under the 2005 Plan include directors, officers or employees of the Company, and certain of its consultants and advisors.  The types of awards that may be granted under the 2005 Plan include stock options, restricted stock, stock bonuses, stock units and dividend equivalents, and other forms of awards granted or denominated in the Company's common stock or units of the Company's common stock, as well as certain cash bonus awards. 

The maximum number of shares of the Company's common stock that may be issued or transferred pursuant to awards under the 2005 Plan remains at 6.0 million shares (inclusive of approximately 4.6 million options previously granted under the Amended 2000 Long-Term Incentive Plan).

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On October 5, 2005 (the "Award Date"), the Compensation Committee of the Board of Directors of the Company, granted awards in the aggregate amount of 288,856 restricted shares of Company common stock (the "Restricted Stock") to the Company's Executive Officers and other Company Officers, and to members of the Board of Directors of the Company.  The Restricted Stock vests, and restrictions lapse, with respect to one-fifth of the total number of shares of Restricted Stock on each of the first, second, third, fourth and fifth anniversaries of the Award Date.  The vesting schedule requires continued employment or service through each applicable vesting date as a condition to the vesting of the applicable installment of the Restricted Stock, and carries specific share holding requirements during such employment or service.  Mentor has recorded $13.2 million, net of amortization and cancellations, in deferred stock-based compensation in accordance with APB No. 25.  Stock compensation expense is recognized over the 5-year vesting period of the Restricted Stock grants.  Restricted Stock compensation expense for fiscal 2006 was $1.5 million.  There was no Restricted Stock compensation expense in fiscal 2005.

Exercise prices for stock options are set at fair market value, as determined by the closing price of the Company's common stock on the New York Stock Exchange on the date of grant, and the related number of shares granted is fixed at that point in time.  Therefore, under the principles of APB Opinion 25, the Company does not recognize compensation expense associated with the grant of stock options.  SFAS 123 "Accounting for Stock-Based Compensation" requires the use of an option valuation model to provide supplemental information regarding options granted after fiscal 1995.  Pro forma information regarding net income and earnings per share shown below were determined as if the Company had accounted for its employee stock options under the fair value method of that statement.  For purposes of pro forma disclosure, the estimated fair value of the options is amortized ratably over the options' vesting period.

Employee Stock Purchase Plan

On September  14, 2005 the Company's Board of Directors approved its Employee Stock Purchase Plan ("ESPP").  The Stock Purchase Plan is intended to assist the Company in securing and retaining its employees by allowing them to participate in the ownership and growth of the Company through the grant of certain rights to purchase shares of the Company's common stock at an initial discount of  5% from the fair market value of its shares.  The granting of such rights serves as partial consideration for employment and gives employees an additional inducement to remain in the service of the Company and its subsidiaries and provides them with an increased incentive to work toward the Company's success.

Under the ESPP, each eligible employee is permitted to purchase shares of common stock through regular payroll deductions and/or cash payments in amounts ranging from 1% to 15% of the employee's compensation for each payroll period. The fair market value of the shares of common stock which may be purchased by any employee under this or any other plan of the Company that is intended to comply with Section 423 of the Internal Revenue Code.

The ESPP provides for a series of consecutive offering periods that are three months long commencing on each Grant Date.  Offering periods commence on January 1, April 1, July 1 and September 1 of each year.  During each offering period, participating employees are able to purchase shares of common stock at a purchase price equal to 95% of the fair market value of the common stock at the end of each offering period.  Under terms of the ESPP, 400,000 shares of common stock have been reserved for issuance to employees.  As of March 31, 2006, 1,174 shares have been granted under the plan.

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Pro Forma Analysis under FAS 123

The pro forma effect on net income may not be representative of the pro forma effect on net income in future years because compensation expense in future years will reflect the amortization of a different number of stock options granted in succeeding years, at different fair values.  The Company's pro forma information is as follows:

	Year Ended March 31,
(in thousands, except per share data)	2006		2005		2004
Net income from continuing operations:  as reported1	$	48,079	$	42,808	$	45,772
Deduct:  compensation expense fair value method	(3,900)		(5,864)		(7,491)
Net income: pro forma	$	44,179	$	36,944	$	38,281
Basic earnings per share from continuing operations:  as reported	$	1.12	$	1.02	$	1.00
Basic earnings per share from continuing operations:  pro forma	$	1.02	$	0.88	$	0.84
Net income from continuing operations: as reported1	$	48,079	$	42,808	$	45,772
Add back after tax interest expense on convertible notes	3,208		3,208		947
Net income: diluted earnings per share	51,287		46,016		46,719
Deduct: compensation expense fair value method	(3,900)		(5,864)		(7,491)
Net income: diluted earnings per share pro forma	$	47,387	$	40,152	$	39,228
Diluted earnings per share from continuing operations:  as reported2	$	1.01	$	0.93	$	0.95
Diluted earnings per share from continuing operations:  pro forma2	$	0.93	$	0.81	$	0.80
1  Net income for fiscal 2005 as reported includes a $4.4 million pre-tax charge  associated with  accelerated vesting    of stock options.   2  Diluted earnings per share and weighted average shares outstanding for fiscal 2004 have been restated to reflect    the additional shares that would be issued upon conversion of our 2¾% convertible notes, in accordance with the    adoption of EITF Issue No. 04-8 in the quarter ended December 2004.

In December 2004, the Financial Accounting Standards Board issued SFAS No. 123(R), "Share-Based Payment".  As of April 1, 2006, SFAS No. 123(R) requires the Company to account for its stock options using a fair-value-based method as described in such statement and recognize the resulting compensation expense in the Company's financial statements.  SFAS 123(R) also requires the benefits of tax deductions in excess of recognized compensation cost to be reported as a financing cash flow, rather than as an operating cash flow as required under current literature.  This requirement will reduce net operating cash flows and increase net financing cash flows in periods after adoption.  Prior to April 1, 2006, the Company accounted for its employee stock options using the intrinsic value method under APB Opinion No. 25, "Accounting for Stock Issued to Employees" and related interpretations, which generally results in no employee stock option expense.  

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The Company has granted options to key employees and non-employee directors under its 2005 Plan and 1991 Plan.  Options granted under both plans are exercisable in four equal annual installments beginning one year from the date of grant, and expire ten years from the date of grant.  Options are granted at the fair market value on the date of grant.  Activity in the stock option plans during fiscal 2006, 2005 and 2004 was as follows:

	At March 31 Options Outstanding
	Number of Shares			Weighted Average Price per Share
Balance March 31, 2003	$	6,436,525		$	11.84
Granted	1,289,635			21.45
Exercised	(1,097,036)			9.36
Canceled or terminated	(110,971)			16.34
Balance March 31, 2004	$	6,518,153		$	14.08
Granted	818,650			32.43
Exercised	(1,028,136)			11.22
Canceled or terminated	(143,936)			19.77
Balance March 31, 2005	$	6,164,731		$	16.83
Granted	893,050			37.49
Exercised	(3,161,517)			13.79
Canceled or terminated	(214,186)			22.41
Balance March 31, 2006	$		3,682,078	$		24.11

At March 31, 2006, the 2000 Plan had options for 2,837,057 shares granted and outstanding, and zero shares available for grant.  The 1991 Plan had options for 816,021 shares granted and outstanding at March 31, 2006.  The 2005 Plan had 29,000 shares granted and outstanding and 1,067,929 shares are available for grant at March 31, 2006.  No additional options can be granted under the 1991 or 2000 Plans.

Information regarding stock options outstanding at March 31, 2006 is as follows:

	Options Outstanding				Options Exercisable
Price Range	Number of Shares	Weighted-Average Remaining Contractual Life	Weighted-Average Exercise Price		Number of Shares	Weighted-Average Exercise Price
Under $19.01	1,471,242	4.94	$	13.67	1,261,945	$	12.79
$21.00-$32.47	1,263,486	7.68	$	26.39	408,387	$	24.94
$32.86-$45.91	947,350	9.08	$	37.29	17,125	$	34.64

At March 31, 2006, 2005 and 2004, stock options to purchase 1,687,457, 3,877,277 and 2,973,209 shares, respectively, were exercisable at weighted-average prices of $15.96, $13.17, and $10.61 respectively. 

Stock option exercise prices are set at the closing price of the Company's common stock on the date of grant and the related number of shares granted is fixed at that point in time.  Therefore, under the principles of APB Opinion 25, the Company does not recognize compensation expense associated with the grant of stock options.  SFAS 123 requires the use of an option valuation model to provide supplemental information regarding options granted after fiscal 1995.  Pro forma information regarding net income and earnings per share shown above were determined as if the Company had accounted for its employee stock options under the fair value method of that statement.

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The weighted average fair values of stock options granted were estimated at the date of grant using the Black-Scholes option valuation model and the following assumptions:

	Year Ended March 31,
	2006		2005		2004
Weighted average fair value of stock   options granted	$	10.60	$	8.91	$	4.85
Risk-free interest rate	3.93%		3.96%		2.68%
Expected life (in years)	4.93		4.74		4.65
Expected volatility	0.32		0.32		0.31
Expected dividend yield	2.047%		2.115%		2.86%

The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options.  The Company's employee stock options have characteristics significantly different from those of traded options such as vesting restrictions and extremely limited transferability.  In addition, the assumptions used in option valuation models are highly subjective, particularly the expected stock price volatility of the underlying stock.  Because changes in these subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do not provide a reliable single measure of the fair value of its employee stock options.

Note H - Income Taxes

Income tax expense consists of the following:

	Year Ended March 31,
(in thousands)	2006		2005		2004
Current:
Federal	$	17,436	$	18,513	$	21,637
Foreign	1,660		615		2,757
State	519		3,446		2,324
	19,615		22,574		26,718
Deferred:
Federal	637		(2,327)		(3,979)
Foreign	(985)		223		(554)
State	339		(533)		(706)
	(9)		(2,637)		(5,239)
	$	19,606	$	19,937	$	21,479

The reconciliation of the federal statutory rate to the Company's effective rate is as follows:

	Year Ended March 31,
	2006	2005	2004
Federal statutory rate	35.0%	35.0%	35.0%
Increase (decrease) resulting from:
State taxes net of federal tax benefit	1.6	2.2	1.2
Non-taxable interest and dividends	(0.4)	(0.1)	-
Research and development credit	(1.7)	(0.5)	(1.0)
ETI/MFG deduction	(1.1)	(0.9)	(0.9)
Foreign operations	(7.3)	(4.2)	(2.5)
Dividend repatriation	2.5	-	-
Non-deductible goodwill	-	-	0.1
Other	0.4	0.3	-
	29.0%	31.8%	31.9%

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Significant components of the Company's deferred tax liabilities and assets at March 31 are as follows:

(in thousands)	2006		2005
Deferred tax liabilities:
Tax over book depreciation	$	-	$	(479)
Unrealized gain (loss) on long-term marketable     securities	(27)		(137)
	(27)		(616)
Deferred tax assets:
Book liabilities not deductible for tax	20,024		17,890
Inventory	521		955
Profit in inventory of foreign subsidiaries	3,295		3,113
Convertible notes hedge	6,239		8,701
	30,079		30,659
Net deferred tax assets	$	30,052	$	30,043

The Company does not provide for U.S. income taxes on undistributed earnings of the Company's foreign operations that are intended to be invested indefinitely outside the United States.  At March 31, 2006, these foreign earnings amounted to approximately $21.4 million.  If repatriated, additional taxes of approximately $7.9 million on these earnings would be due, based on the current tax rates in effect.  For the years ended March 31, 2006, 2005, and 2004 foreign income before taxes were $19.3 million, $13.8 million and $6.2 million, respectively. 

On October 22, 2004, the President of the United States signed the American Jobs Creation Act of 2004 (AJCA).  The AJCA created a temporary incentive for U.S. corporations to repatriate accumulated income earned abroad by providing an 85 percent dividends received deduction for certain dividends from controlled foreign corporations.  For fiscal 2006 the Company repatriated $32.0 million in foreign profits, and the Company estimates the tax liability on the $32.0 million to be approximately $1.74 million.

 Note I - Intangible Assets and Goodwill

In 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible Assets".  SFAS No. 142 was effective for the Company as of April 1, 2002.  SFAS No. 142 specifies the financial accounting and reporting for acquired goodwill and other intangible assets.  Goodwill and intangible assets that have indefinite useful lives are no longer to be amortized, but rather are to be tested for impairment annually or more frequently if impairment indicators arise.  None of the Company's intangible assets have an indefinite life.  Intangible assets with finite lives continue to be amortized on a straight-line basis over their useful lives.  Goodwill and intangible assets have been recorded at either incurred or allocated cost.  Allocated costs were based on respective fair values at the date of acquisition. 

Upon the adoption of SFAS No. 142, the Company reassessed the remaining amortization periods of intangible assets acquired on or before June 30, 2001, and assigned all goodwill to reporting units for impairment testing.  The impairment tests involve the use of both estimates of fair value as well as discounted cash flow assumptions.  Impairment tests were performed at adoption and in the fourth quarter of each subsequent fiscal year.  In the fourth quarter of fiscal 2005, the Company performed impairment testing and determined that certain intangible assets had fair values less than their respective book values and were deemed impaired.  Accordingly, the Company recorded a net impairment charge for the impairment of long-lived assets of $0.3 million.  No impairment was noted for fiscal 2006.

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Balances of acquired intangible assets were as follows:

	Year Ended March 31, 2006
(in thousands)	Original Cost		Accumulated Amortization		Carrying Value		Useful Life
Patents	$	5,842	$	(1,152)	$	4,690	5-20
Licenses	10,823		(3,156)		7,667		3-17
Trademarks	67		(23)		44		10-20
Other intangibles	5,672		(2,328)		3,344		3-20
Subtotal intangibles	22,404		(6,659)		15,745
Goodwill	9,966		(723)		9,243
Total intangibles and goodwill	$	32,370	$	(7,382)	$	24,988

	Year Ended March 31, 2005
(in thousands)	Original Cost		Accumulated Amortization		Carrying Value		Useful Life
Patents	$	6,323	$	(677)	$	5,646	5-20
Licenses	10,823		(2,589)		8,234		3-17
Trademarks	67		(26)		41		10-20
Other intangibles	4,474		(1,144)		3,330		3-20
Subtotal intangibles	21,687		(4,436)		17,251
Goodwill	9,753		(722)		9,031
Total intangibles and goodwill	$	31,440	$	(5,158)	$	26,282

The aggregate amortization expense on intangible assets recorded for fiscal 2006 was $2.3 million.  The following table summarizes the estimated aggregate amortization expense for each of the five succeeding fiscal years:

Year Ended	Estimated Amortization Expense (in thousands)
March 31, 2007	$	2,303
March 31, 2008	$	2,193
March 31, 2009	$	1,708
March 31, 2010	$	914
March 31, 2011	$	914

The changes in the carrying amount of goodwill for fiscal 2006, 2005 and 2004 were as follows:

(in thousands)
Balance at March 31, 2003	$	3,475
Goodwill acquired	5,391
Currency translation	323
Balance at March 31, 2004	9,189
Goodwill acquired	45
Goodwill disposed	(277)
Currency translation	74
Balance at March 31, 2005	9,031
Goodwill acquired	455
Goodwill disposed	(73)
Currency translation	(170)
Balance at March 31, 2006	$	9,243

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Note J - Acquisitions

A-Life Ltd.

On August 25, 2003, the Company completed the acquisition of A-Life Ltd, which had developed a hyaluronic acid based dermal filler product, from Vitrolife, AB.  The acquisition was valued at $7.5 million, net of cash acquired, and was paid from existing cash balances.  The purchase price was allocated to the tangible and intangible net assets acquired on the basis of their respective fair values on the acquisition date.  The purchase price was allocated to accounts receivable of $36,000, other assets of $349,000, production equipment of $393,000 and intangible assets of $6,821,000, net of accrued liabilities of $123,000.

Note K - Earnings per Share

A reconciliation of weighted average shares outstanding, used to calculate basic earnings per share, to weighted average shares outstanding assuming dilution, used to calculate diluted earnings per share, follows:

	Year Ended March 31,
(in thousands, except per share data)	2006		2005		2004
Net income from continuing operations: as reported	$	48,079	$	42,808	$	45,772
Add back after tax interest expense on convertible note	3,208		3,208		947
Net income from continuing operations for numerator of diluted   earnings per share	$	51,287	$	46,016	$	46,719
	Year Ended March 31,
(in thousands)	2006		2005		2004
Weighted average outstanding shares: basic	42,995		41,921		45,543
Restricted grants	140		-		-
Shares issuable through exercise of stock options	1,901		2,620		2,214
Shares issuable through convertible notes	5,138		5,126		1,515
Shares issuable through warrants	696		-		-
Weighted average outstanding shares: diluted	50,870		49,667		49,272
Basic earnings per share	$	1.12	$	1.02	$	1.00
Diluted earnings per share1	$	1.01	$	0.93	$	0.95
1 Per share amounts and diluted shares outstanding for fiscal 2004 have been restated to reflect the additional shares that would be issued upon   conversion of the Company's 2¾% convertible notes, in accordance with  the adoption of Emerging Issue Task Force (EITF) Issue No. 04-8 in   the quarter ended December 2004.

Employee stock options

Shares issuable under the Company's employee stock option plans that have exercise prices in excess of the average price per share during the period are included in the diluted earnings per share calculation using the treasury stock method.  Options to purchase 1,000, 68,500 and 66,500 shares with exercise prices greater than the average market prices of common stock were outstanding during fiscal 2006, 2005 and 2004, respectively.  These options were excluded from the respective computations of diluted earnings per share because their effect would be anti-dilutive.

Convertible subordinated notes and warrants

The terms of the Company's convertible subordinated notes include restrictions which prevent the holder from converting the notes until the Company's share price exceeds the 120% Conversion Price on 20 trading days of the 30 consecutive trading day period ending on the first day of such fiscal quarter.  However, EITF issue No. 04-8 requires that the Company use the if-converted method to determine the dilutive impact of the convertible subordinated notes described below in Note L.  Under the if-converted method, the numerator of the diluted earnings per share calculation is increased by the after-tax interest expense avoided for the period upon conversion and the denominator of the calculation is increased by approximately 5.1 million shares potentially issued upon conversion for both that current reporting period and the corresponding year-to-date reporting period.

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As described below in Note L, we purchased a convertible note hedge and sold warrants which, in combination, have the effect of reducing the dilutive impact of the convertible subordinated notes by increasing the effective conversion price for the notes from the Company's perspective to approximately $39.2633.  SFAS 128, however, requires the Company to analyze the impact of the convertible note hedge and warrants on diluted earnings per share separately.  As a result, the purchase of the convertible note hedge is excluded because its impact will always be anti-dilutive.  SFAS 128 further requires that the impact of the sale of the warrants be computed using the treasury stock method. 

For example, using the treasury stock method, if the average price of the Company's stock during the period ended March 31, 2006 had been $38.00, $43.00 or $49.00, the shares from the warrants to be included in diluted earnings per share would have been zero, 447,000 and 1,022,000 shares, respectively.  The total maximum number of shares that could potentially be included under the warrants is 5.1 million.  The average share price of our stock during the quarter ended March 31, 2006 exceeded the $39.2633 conversion price of the warrants.  The impact of these warrants was that 0.663 million shares were added to the diluted shares and diluted earnings per share calculation during that period, and the weighted average impact for the full fiscal year was 0.696 million shares.  The Company adopted the provisions of EITF 04-8, "The Effect of Contingently Convertible Debt on Diluted Earnings per Share," in December 2004.  The EITF required the inclusion of contingently issuable shares in the calculation of diluted earnings per share when the effect would be dilutive even if none of the required conditions for conversion were satisfied.  In addition, the EITF required application on retrospective basis for all periods presented.  

Note L - Long-Term Debt

On December 22, 2003, the Company completed an offering of $150 million of convertible subordinated notes due January 1, 2024 pursuant to Rule 144A under the Securities Act of 1933.  The notes bear interest at 2¾% per annum and are convertible into shares of the Company's common stock at an adjusted conversion price of $29.167per share and are subordinated to all existing and future senior debt.

Holders of the notes may convert their notes only if any of the following conditions is satisfied:

• during any fiscal quarter prior to January 1, 2019, if the closing price of the Company's common stock for at least 20 trading days in the 30 consecutive trading day period ending on the first trading day of such fiscal quarter is more than 120% of the conversion price per share of the Company's common stock on such trading day;
• any business day on or after January 1, 2019, if the closing price of the Company's common stock on the immediately preceding trading day is more than 120% of the conversion price per share of the Company's common stock on such trading day;
• during the five business day period after any five consecutive trading day period if the average of the trading prices of the notes for such five consecutive trading day period is less than 98% of the average of the conversion values of the notes during such period, subject to certain limitations;
• if the Company has called the notes for redemption; or
• if the Company makes certain significant distributions to holders of its common stock or the Company enters into specified corporate transactions.

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At an initial conversion price of $29.289, each $1,000 principle amount of notes will be convertible into 34.1425 shares of common stock.  As a result of the Company's recent dividend increase, the conversion price has been adjusted to $29.167, and each $1,000 principle amount will be convertible into 34.2853 shares of common stock.

During the quarter ending March 31, 2006, one of the conditions required for conversion of the notes was satisfied and, accordingly, the holders of notes have the option to convert the notes into common shares at the aforementioned adjusted conversion price per share. 

Concurrent with the issuance of the convertible subordinated notes, the Company purchased a convertible note hedge from Credit Suisse First Boston LLC.  The note hedge expires on January 1, 2009 and gives the Company the ability to purchase shares of our common stock equal to the number of shares we are obligated to issue under any convertible notes converted by the holder prior to the hedge expiration date at a purchase price equal to the conversion price of the convertible notes. 

Concurrent with the issuance of the notes, the Company issued warrants to Credit Suisse First Boston LLC.  The warrants are European-style call warrants, which also expire on January 1, 2009.  The holder of the warrants is entitled to purchase 5.14 million shares of the Company's common stock at $39.2633.  The number of shares and exercise price of the warrants are subject to adjustment from time to time in a similar manner to the convertible notes.

Both the note hedge and the warrants may be settled either in cash or shares at the Company's option.  The Company is not obligated under either the warrants or the note hedge, to settle its obligations in cash.  Under no circumstance is the Company obligated to issue shares under the note hedge.  The warrants do require the Company to settle its obligations thereunder in cash or shares, do permit the Company to settle its obligation in unregistered shares and contain no provision obligating the Company to settle its obligations in freely-tradable shares, and the Company is not required to make any cash payments under the warrants for failure to have a registration statement declared effective.  There are no required cash payments to the holder of the warrants if the shares initially delivered upon settlement are subsequently sold by the holder and the sales proceeds are insufficient to provide the holder with an expected return.  The Company has sufficient authorized shares to settle the warrants and the convertible notes in shares, considering all of its obligations under the instruments for their full terms.  The warrants, note hedge, and convertible notes each contain an express limit on the number of shares issuable thereunder.  The warrants and note hedge expressly indicate that the holder of the warrants has no rank higher than those of a shareholder of the stock underlying the warrants.  Under certain circumstances in a change of control of the Company we may be required to issue additional shares under a make-whole provision under the warrant. The Company has no obligation to post collateral under the warrants, convertible notes or note hedge. 

The cost of the note hedge and the proceeds from the sale of warrants have been included in shareholders' equity in accordance with the guidance in EITF No. 00-19, "Accounting for Derivative Financial Instruments Indexed to and Potentially Settled in a Company's own Stock."  Any proceeds received or payments made upon termination of these instruments will be recorded in shareholders' equity.

Note M - Share Repurchase Program

The Company has a stock repurchase program to provide liquidity to the market and to reduce the overall number of shares outstanding, which has helped offset the dilutive effects of our employee stock option programs  and the dilutive effect of EITF Issue No. 04-8 related to the inclusion of contingently convertible debt in fully diluted earnings per share calculations.  All shares repurchased under the program are retired and are no longer deemed to be outstanding.  At March 31, 2003, 1.8 million shares remained authorized for repurchase under prior year's Board of Directors authorization.  On July 31, 2003 the Board of Directors increased the authorized number of shares to be repurchased from 1.8 million to 4.0 million shares.  On December 5, 2003, the Board of Directors increased the authorized number of shares to be repurchased by 5.0 million shares from 2.5 million to 7.5 million shares.  On March 6, 2006, the Board of Directors increased the authorized number of shares to be repurchased by 5.0 million shares from 1.3 million to 6.3 million shares.  During fiscal 2004, 5.4 million shares were repurchased for $135.8 million and 3.6 million shares remained authorized for repurchase as of March 31, 2004.  During fiscal 2005, 2.3 million shares were repurchased for $79.8 million and 1.3 million shares remained authorized for repurchase as of March 31, 2005.  During fiscal 2006, approximately 996,000 were repurchased from retiring board members for approximately $42.8 million, and 5.3 million shares remained authorized for repurchase as of March 31, 2006.  See Note O - Related Party Transactions for additional information on the share repurchase.  See Note W - Subsequent Events (Unaudited) for additional share repurchases subsequent to March 31, 2006.  The timing of repurchases is subject to market conditions, cash availability, and blackout periods during which the Company is restricted from repurchasing shares.  There is no guarantee that the remaining shares authorized for repurchase by the Board will ultimately be repurchased. 

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Note N - Commitments

The Company leases certain facilities under non-cancelable operating leases with unexpired terms ranging from 1 to 16 years.  Most leases contain renewal options.  Rental expense from continuing operations for these leases was $4.0 million, $3.5 million and $2.8 million for fiscal 2006, 2005 and 2004, respectively.

Future minimum lease payments under lease arrangements at March 31, 2006 were as follows:

(in thousands)
2007	$	4,804
2008	4,726
2009	4,613
2010	4,452
2011	4,224
Thereafter	12,351
Total	$	35,170

Note O - Related Party Transactions

On December 13, 2004, the Company repurchased 1,500,000 shares of its common stock from two investment partnerships managed by VA Partners, LLC, at the time our largest shareholder, at a purchase price of $33.85 per share, the closing price of the common stock on the NYSE on that date.  On December 14, 2004 the Company repurchased an additional 750,000 shares of its common stock from the same investment partnerships at $34.00 per share, a discount to the $34.41 closing price on the NYSE on that date.  The 2.25 million shares were repurchased for a total of $76.3 million pursuant to the Company's continuing stock repurchase program and represented approximately 5% of outstanding shares before the occurrence of the transactions.  VA Partners, LLC, through several of its investment partnerships, owned 6.9 million shares representing approximately 16% of our outstanding common stock prior to these transactions.  Mr. Jeff Ubben, a managing member of VA Partners, LLC, is a member of Mentor's Board of Directors.  The Company's Audit Committee evaluated and pre-approved the transactions.

On March 6, 2006, the Company repurchased 995,814 shares of its common stock from two retiring members of the Board of Directors at a purchase price of $43.00 per share, a discount from the closing price of our common stock on the NYSE of $44.37 on that date.  The Company's Audit Committee and the Board of Directors evaluated and pre-approved the transactions.

On June 5, 2006, the Company repurchased 2.0 million shares of its common stock from an investment partnership managed by ValueAct Capital at $42.00 per share, a discount to the $42.21 closing market on the NYSE on that date.  The 2.0 million shares were repurchased for a total of $84 million pursuant to the Company's continuing stock repurchase program and represent approximately 4.6% of outstanding shares before the transactions.  After the transactions, ValueAct Capital, through several of its investment partnerships, continues to own more than 2 million shares of Common Stock, or approximately 5% of the outstanding shares of the Company.  The repurchase of these shares was pre-approved by the Audit Committee and the Board of Directors with interested parties abstaining or not in attendance. 

See Note R for a description of severance payments made to two of the Company's former executive officers.

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Note P - Warranty Reserves

The Company provides an accrual for the estimated cost of product warranties at the time revenue is recognized.  The Company offers product replacement and certain financial assistance for surgical procedures that fall within the limited warranties and coverage period of implantation on its breast implant products.  Such accruals are based on estimates, taking into consideration relevant factors such as unit sales, historical experience, warranty period, estimated costs, and, to a limited extent, information developed by the Company's insurance company using actuarial techniques.  The Company assesses the adequacy of the accrual for product warranties periodically and adjusts the amounts as necessary based on actual experience and changes in future expectations.  In the first quarter of fiscal 2006, the Company expanded its standard limited warranty programs to provide certain financial assistance for surgical procedures within ten years of implantation (increased from five years) and in the third quarter of fiscal 2006 expanded the program coverage to include silicone gel-filled breast implant sales implanted in certain European and other international countries.  These changes to the Company's warranty programs were not retroactive, but applicable to implants implanted subsequent to the effective date of the expanded programs. 

The following table presents changes in the Company's accrued product warranty reserves for fiscal 2006, 2005 and 2004.

	Year Ended March 31,
(in thousands)	2006		2005		2004
Beginning warranty reserves	$	19,245	$	17,783	$	14,392
Cost of warranty claims	(3,860)		(4,186)		(3,615)
Accrual for product warranties	6,965		5,648		7,006
Adjustments made to accruals related to pre-existing warranties		-		-		-
Ending warranty reserves	$	22,350	$	19,245	$	17,783

Note Q - Contingencies

Warranty and product liability claims are a regular and ongoing aspect of the medical device industry.  At any one time, the Company may be subject to claims against it and may be involved in litigation.  These actions can be brought by an individual, or by a group of patients purported to be a class action.  The Company is currently involved in a number of product liability legal actions, the outcomes of which are not within its control and may not be known for prolonged periods of time.  The Company has retained liabilities associated with warranty and product liability claims arising out of its urology products sold prior to the June 2, 2006 closing date.  No individual product liability case or group of cases, in which the Company is currently involved, is considered material and there are no certified class actions currently pending against the Company.  In accordance with SFAS No. 5 "Accounting for Contingencies", a liability is recorded in the consolidated financial statements when a loss is known or considered probable and the amount can be reasonably estimated.  If the reasonable estimate of a known or probable loss is a range, and no amount within the range is a better estimate, the minimum amount of the range is accrued.  If a loss is not probable or cannot be reasonably estimated, no liability is recorded in the consolidated financial statements.

The Company carries product liability insurance on all its products, except its silicone gel-filled implants, which in the United States are only available through a controlled clinical study.  This insurance is subject to certain self-insured retention and other limits of the policy, exclusions and deductibles that the Company believes to be appropriate.  At March 31, 2006, the Company had established reserves of $2.9 million for product related claims to the extent that those claims may result in settlements or judgments within its self-insured retention limits.  In addition, at March 31, 2006, the Company had established additional reserves of $3.8 million, through its wholly owned captive insurance company based on actuarially determined estimates and taking the Company's excess insurance coverage into account.  Those reserves were actuarially determined based on historical information, trends and certain assumptions about future claims and are primarily for claims that have been asserted.  Should actual product liability experience differ from the estimates and assumptions used to develop these reserves, subsequent changes in these reserves will be recorded in selling, general and administrative expenses and may affect the Company's operating results in future periods.

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In addition, the Company also offers limited warranty coverage on some of its products (see Note P for details). While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers, the limited warranty obligation is affected by reported rates of product problems as well as the costs incurred in correcting product problems.  Should actual warranty experience differ from the estimates and assumptions used to develop the warranty reserves, subsequent changes in the reserves will be recorded in cost of sales and may affect our operating results in future periods.

In addition, in the ordinary course of its business, the Company experiences various types of claims that sometimes result in litigation or other legal proceedings.  The Company does not anticipate that any of these proceedings will have a material adverse effect on the Company.

Note R - Severance Charges and Restructuring and Long-Lived Asset Impairment Charges

Severance Charges

On February 16, 2005, Christopher J. Conway and Adel Michael each resigned as a director and executive officer of the Company.  In connection with resignation and severance agreements entered into with them, the Company incurred $8.5 million in expenses in February 2005.  As one of the co-founders of the Company, and following 36 years of service, Mr. Conway received certain severance compensation in the form of both cash payments totaling $2.3 million and non-cash benefits in the amount of $2.1 million related to the accelerated vesting of his unvested and unexpired stock options.  In addition, Mr. Adel Michael, the Company's former Vice Chairman, received severance compensation in the form of cash benefits in the amount of $1.8 million and non-cash benefits in the amount of $2.3 million related to the accelerated vesting of his unvested and unexpired employee stock options.     

Restructuring and Long-Lived Asset Impairment Charges 

During the fourth quarter of fiscal year 2005, the Company incurred $1.7 million in expenses related to restructuring of certain of our operations to achieve improved efficiencies and certain long-lived assets that were determined to be impaired.  The restructuring charges totaled $1.4 million and the impairment charges totaled $0.3 million. 

Note S - Postretirement Benefit Plan

The Company's Savings and Investment Plan is a qualified salary-reduction plan under Section 401(k) of the Internal Revenue Code in which substantially all of our U.S. employees may participate by contributing a portion of their compensation.  The Company matches contributions up to specified percentages of each employee's compensation depending on how the employee allocates his or her contributions.  Charges against income for the matching contributions, were $0.9 million, $0.8 million and $0.8 million for fiscal years 2006, 2005 and 2004, respectively.

Note T - Discontinued Operations

In October, 2005, the Company announced that it was evaluating strategic alternatives for its Urology Business that would both enhance shareholder value and enable the Company to focus more fully on its aesthetics business.  On May 17, 2006 the Company executed a definitive agreement for the sale of the Company's Surgical Urology and Clinical and Consumer Healthcare business segments to Coloplast for $463 million, of which $456 million is in cash and $7 million is in non-cash consideration consisting of the value of certain foreign tax credits that the Company expects to realize arising from the transaction prior to the close.  The sale was completed on June 2, 2006.  In accordance with SFAS No. 144 "Accounting for the Impairment or Disposal of Long Lived Assets," the assets and liabilities related to this transaction have been segregated from continuing operations and are reported as assets and liabilities of discontinued operations in the accompanying consolidated balance sheets.  In addition, operations associated with these segments have been classified as income from discontinued operations in the accompanying consolidated statements of income.

82

The major classes of assets and liabilities of discontinued operations included in the Company's Consolidated Balance Sheets were as follows:

	As of March 31,
(In thousands)	2006		2005
Assets held for sale:
Accounts Receivable, net	$	50,698	$	53,531
Inventories	38,016		39,874
Deferred income taxes	4,305		3,932
Prepaid expenses and other current assets	3,051		2,925
Total current assets held for sale	96,070		100,262
Property, plant and equipment, net	29,497		35,316
Intangible assets, net	14,063		14,904
Goodwill, net	16,380		15,049
Other assets	324		613
Total assets held for sale	$	156,334	$	166,144
Liabilities associated with assets held for sale:
Accounts payable and accrued liabilities	$	27,220	$	31,638
Income taxes payable	1,751		636
Current portion of purchase price related to acquired technologies and acquisitions	1,000		1,812
Short-term bank borrowings	-		2,212
Total current liabilities associated with assets held for sale	29,971		36,298
Other long-term liabilities	10,555		13,720
Total liabilities associated with assets held for sale	$	40,526	$	50,018

Net sales from discontinued operations were $235.5 million, $231.7 million and $203.7 million for fiscal years 2006, 2005 and 2004, respectively.  Income before income taxes from discontinued operations were $24.8 million, $18.5 million and $12.9 million for fiscal years 2006, 2005 and 2004, respectively.

Included in discontinued operations for fiscal 2006, were pre-tax charges of $6.1 million related to the divestiture of the Company's surgical urology and clinical and consumer healthcare businesses.  Included in discontinued operations for fiscal 2005 were pre-tax charges of $6.6 million related to the Company's restructuring and long-lived asset impairment.  Included in discontinued operations for fiscal 2004 were pre-tax charges of approximately $1.0 million related to a reorganization of the urology sales force.

83

Note U - Segment Information for Continuing Operations

We operate in one business segment - aesthetic medicine.  Therefore, results of operations are reported on a consolidated basis for purposes of segment reporting.  The Company's operations by geographic area are presented below.

	Year Ending March 31,
(in thousands)	2006		2005		2004
Geographic area net sales
United States	$	192,764	$	186,488	$	163,445
Canada	15,178		12,641		11,093
All other countries	60,330		52,597		43,899
Consolidated total	$	268,272	$	251,726	$	218,437
	At March 31,
(in thousands)	2006		2005		2004
Geographic area long-lived assets
United States	$	31,973	$	32,774	$	33,529
Netherlands	15,413		16,460		16,259
All other countries	14,050		14,019		14,684
Consolidated total	$	61,436	$	63,253	$	64,472

Note V - Quarterly Financial Data (Unaudited)

The following is a summary of unaudited quarterly results of operations:

(in thousands, except per share data)
Year Ended March 31, 2006	First		Second		Third		Fourth
Net sales	$	74,126	$	58,672	$	63,072	$	72,402
Gross profit	55,780		43,949		46,896		52,438
Net income from continuing operations	17,075		8,182		9,246		13,576
Net income from discontinued operations,   net of tax	5,400		3,936		3,498		1,444
Net income	$	22,475	$	12,118	$	12,744	$	15,020
Basic earnings per share
Continuing operations	$	0.41	$	0.19	$	0.21	$	0.31
Discontinued operations		0.13		0.09		0.08		0.03
Basic earnings per share	$	0.54	$	0.28	$	0.29	$	0.34
Diluted earnings per share
Continuing operations	$	0.36	$	0.18	$	0.19	$	0.28
Discontinued operations	0.11		0.07		0.07		0.03
Diluted earnings per share	$	0.47	$	0.25	$	0.26	$	0.31

84

Year Ended March 31, 2005	First		Second		Third		Fourth
Net sales	$	65,544	$	54,322	$	63,181	$	68,679
Gross profit	47,739		39,692		47,470		52,249
Net income from continuing operations	14,055		9,910		12,685		6,158
Net income from discontinued operations,   net of tax	3,599		2,624		3,644		2,206
Net income	$	17,654	$	12,534	$	16,329	$	8,364
Basic earnings per share
Continuing operations	$	0.34	$	0.23	$	0.30	$	0.15
Discontinued operations		0.08		0.06		0.09		0.06
Basic earnings per share	$	0.42	$	0.29	$	0.39	$	0.21
Diluted earnings per share
Continuing operations	$	0.30	$	0.22	$	0.27	$	0.14
Discontinued operations		0.07		0.05		0.07		0.05
Diluted earnings per share	$	0.37	$	0.27	$	0.34	$	0.19

Note W - Subsequent Events (Unaudited)

As part of its share repurchase program, the Company agreed on June 5, 2006 to repurchase from an investment partnership managed by ValueAct Capital 2.0 million shares of its common stock at $42 per share, a discount from the closing market price quoted on the New York Stock Exchange of $42.21 on June 5, 2006.  The 2.0 million shares were repurchased for a total of $84 million pursuant to the Company's continuing stock repurchase program and represent approximately 4.6% of outstanding shares before the transactions.  After the transactions, ValueAct Capital, through several of its investment partnerships, continues to own more than 2 million shares of Common Stock, or approximately 5% of the outstanding shares of the Company.  ValueAct Capital's managing director, Mr. Jeff Ubben, is a member of the Company's Board of Directors.  The repurchase of these shares was pre-approved by the Audit Committee and the Board of Directors with interested parties abstaining or not in attendance. 

As of June 12, 2005, approximately 3.3 million shares remain authorized for repurchase under the Company's stock repurchase program.  All shares repurchased under the program have been retired and are no longer deemed to be outstanding.  There is no guarantee that the remaining shares authorized for repurchase will ultimately be repurchased. 

The additional shares available for repurchase are subject to limitations set forth in the Company's Credit Agreement previously entered into on May 26, 2005 and amended on May 31, 2006.  The amended Credit Agreement now permits the repurchase of up to $250,000,000 of equity securities, a portion of which was utilized in the repurchase described in the previous paragraph, leaving a remaining amount of $166,000,000.  In addition, after the $250,000,000 is utilized for such repurchases, the Company may repurchase during any four consecutive quarters additional equity securities in an amount limited to the Company's consolidated net income, less dividends paid, for the preceding four quarters.

85

SCHEDULE II

VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
(in thousands)

				Additions
Description	Balance at Beginning of Period			Charged to Costs and Expenses			Charged to Other Accounts			Deductions			Balance at End of Period
Year Ended March 31, 2006
Deducted from asset accounts:
Allowance for doubtful accounts	$	3,839		$	1,804		$	-		$	1,027		$	4,616
Liability reserves:
Warranty reserves	$	19,245		$	6,965		$	-		$	3,860		$	22,350
Product liability reserves	5,232			1,732			-			263			6,701
Accrued sales returns and allowances	13,162			9,049			-			6,667			15,544
	$	37,639		$	17,746		$	-		$	10,790		$	44,595
Year Ended March 31, 2005
Deducted from asset accounts:
Allowance for doubtful accounts	$		3,560	$		1,113	$		-	$		834	$		3,839
Liability reserves:
Warranty reserves	$		17,783	$		5,648	$		-	$		4,186	$		19,245
Product liability reserves	4,530			915			-			213			5,232
Accrued sales returns and allowances	11,327			8,697			-			6,862			13,162
	$		33,640	$		15,260	$		-	$		11,261	$		37,639
Year Ended March 31, 2004
Deducted from asset accounts:
Allowance for doubtful accounts	$		2,933	$		1,823	$		-	$		1,196	$		3,560
Liability reserves:
Warranty reserves	$		14,392	$		7,006	$		-	$		3,615	$		17,783
Product liability reserves	4,517			620			-			607			4,530
Accrued sales returns and allowances	10,005			3,859			-			2,537			11,327
	$		28,914	$		11,485	$		-	$		6,759	$		33,640

86

Signatures

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	MENTOR CORPORATION
DATE: June 14, 2006	/s/JOSHUA H. LEVINE
	Joshua H. Levine
	President and Chief Executive Officer

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Joshua H. Levine and Loren L. McFarland and each of them, acting individually, as his attorney-in-fact, with full power of substitution, for him and in any and all capacities, to sign any and all amendments to this report on Form 10-K (including any post-effective amendments thereto) and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant, and in the capacities and on the dates indicated:

Signatures	Title	Date Signed
/s/JOSHUA H. LEVINE                       Joshua H. Levine	President and Chief Executive Officer (Principal Executive Officer)	June 14, 2006
/s/LOREN L. MCFARLAND              Loren L. McFarland	Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer)	June 14, 2006
/s/JOSEPH E. WHITTERS  Joseph E. Whitters	Chairman of the Board	June 9, 2006
/s/MICHAEL L. EMMONS                Michael L. Emmons	Director	June 13, 2006
/s/WALTER W. FASTER                   Walter W. Faster	Director	June 13, 2006
/s/MICHAEL NAKONECHNY          Michael Nakonechny	Director	June 9, 2006
/s/RONALD J. ROSSI                          Ronald J. Rossi	Director	June 13, 2006
/s/JEFFREY W. UBBEN                      Jeffrey W. Ubben	Director	June 13, 2006

87

EXHIBIT INDEX
Item Number
2.1	Binding Offer Letter from Coloplast A/S regarding purchase of Mentor Urology Business dated March 27, 2006.
2.2	Revised Binding Offer Letter from Coloplast A/S regarding purchase of Mentor Urology Business dated May 5, 2006 Including Appendix A.
2.3	Purchase Agreement between Coloplast A/S and Mentor Corporation dated May 17, 2006
2.4	Listing Schedules for Purchase Agreement between Coloplast A/S and Mentor Corporation dated May 17, 2006.
2.5	Side Letter Agreement Between Coloplast A/S and Mentor Corporation dated June 2, 2006.
3.1	Composite Restated Articles of Incorporation of the Company dated December 12, 2002 -- Incorporated by reference to Exhibit 3.1 of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2003.
3.2	Amended and Restated Bylaws of Mentor Corporation dated September 14, 2005 -- Incorporated by reference to Exhibit 3.2 of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
4.1	Indenture 2¾% Convertible Subordinated Notes Due 2024, dated December 22, 2003 --Incorporated by reference to Exhibit 4.1 of the Registrant's Quarterly Report on Form 10-Q for the quarter ended December 31, 2003.
10.1*	Mentor Corporation 1991 Stock Option Plan -- Incorporated by reference to Registration Statement on Form S-8, Registration No. 333-48815, filed June 24, 1992.
10.2*	Mentor Corporation 2000 Stock Option Plan -- Incorporated by reference to Registration Statement on Form S-8, Registration No. 333-73306, filed November 14, 2001.
10.3*	Mentor Corporation 1991 Stock Option Plan -- Incorporated by reference to Registration Statement on Form S-8, Registration No. 333-100841, filed October 30, 2002.
10.4*	Mentor Corporation 2005 Long-Term Incentive Plan (as amended November 2005).
10.5*	Mentor Corporation Employee Stock Purchase Plan -- Incorporated by reference to Exhibit 10.9 of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
10.6	Lease Agreement, dated November 1989, between Mentor Corporation and Skyway Business Center Joint Venture -- Incorporated by reference to Exhibit 10(b) of the Registrant's  Annual Report on Form 10-K for the year ended March 31, 2002.
10.7	First Amendment to Lease Agreement, dated December 1, 1993, between Mentor Corporation and Skyway Business Center Joint Venture -- Incorporated by reference to Exhibit 10(c) of the Registrant's  Annual Report on Form 10-K for the year ended March 31, 2002.
10.8	Lease Agreement, dated July 23, 1990, between Mentor Corporation and SB Corporate Center, Ltd., covering 201 Mentor Drive, Santa Barbara, CA 93111 -- Incorporated by reference to Exhibit 10(f) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2003.

88

EXHIBIT INDEX (continued)

Item Number
10.9	Lease Agreement, dated August 19, 1998, between Mentor Corporation and SB Corporate Center, LLC, covering 301 Mentor Drive -- Incorporated by reference to Exhibit 10(n) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 1999.
10.10*	Incentive Bonus Plan -- Incorporated by reference to Exhibit 10(2) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2003.
10.11	Convertible Note Hedge Confirmation, dated December 17, 2003 -- Incorporated by reference to Exhibit 10(b) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended December 31, 2003.
10.12	Registration Rights Agreement - 2¾% Convertible Subordinated Notes Due 2024, dated December 22, 2003 -- Incorporated by reference to Exhibit 10(c) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended December 31, 2003.
10.13	Warrants Confirmation, dated December 17, 2003 -- Incorporated by reference to Exhibit 10(d) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended December 31, 2003.
10.14	Purchase Agreement - 2¾% Convertible Subordinated Notes Due 2024, dated December 17, 2003 -- Incorporated by reference to Exhibit 10(e) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended December 31, 2003.
10.15	Collared Accelerated Share Repurchase Transaction, dated March 8, 2004 -- Incorporated by reference to Exhibit 10(29) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2004.
10.16*	Amendment to Employment Agreement between Mentor Corporation and Eugene Glover, effective April 9, 2004 -- Incorporated by reference to Exhibit 10(32) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2004.
10.17	Exclusive Supply Agreement between Alchemy Engineering, LLC d/b/a SiTech, LLC and Mentor Corporation -- Incorporated by reference to Exhibit 10(33) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2004.
10.18*	Employment Agreement dated July 15, 2004, between Mentor Corporation and Peter Shepard -- Incorporated by reference to Exhibit 10(1) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2004.
10.19*	Employment Agreement dated July 27, 2004, between Mentor Corporation and Bobby Purkait -- Incorporated by reference to Exhibit 10(2) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2004.
10.20*	Employment Agreement dated August 6, 2004, between Mentor Corporation and Adel Michael -- Incorporated by reference to Exhibit 10(3) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2004.
10.21*	Employment Agreement between Mentor Corporation and Joshua H. Levine dated August 25, 2005 --Incorporated by reference to Exhibit 10(1) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
10.22*	Employment Agreement between Mentor Corporation and Loren L. McFarland dated August 25, 2005 -- Incorporated by reference to Exhibit 10(2) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.

89

EXHIBIT INDEX (continued)

Item Number
10.23*	Employment Agreement between Mentor Corporation and Kathleen M. Beauchamp dated August 25, 2005 -- Incorporated by reference to Exhibit 10(3) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
10.24*	Employment Agreement between Mentor Corporation and David J. Adornetto dated August 25, 2005 -- Incorporated by reference to Exhibit 10(4) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
10.25*	Employment Agreement between Mentor Corporation and A. Christopher Fawzy dated August 25, 2005 -- Incorporated by reference to Exhibit 10(5) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
10.26*	Employment Agreement between Mentor Corporation and Cathy S. Ullery dated August 25, 2005 --Incorporated by reference to Exhibit 10(6) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
10.27*	Employment Agreement between Mentor Corporation and Clarke Scherff dated August 25, 2005 -- Incorporated by reference to Exhibit 10(4) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2006.
10.28	Amended and Restated Supply Agreement, dated July 6, 2004 by and among NuSil Corporation, SiTech Inc., and Mentor Corporation -- Incorporated by reference to Exhibit 10(9) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2004.
10.29*	Mentor Corporation Option Agreement -- Incorporated by reference to Exhibit 10(3) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2004.
10.30*	Written Description of Directors Fees Pursuant to Item 601(b)(10)(iii)(A) of Regulation S-K -- Incorporated by reference to Exhibit 10(4) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2004.
10.31*	Incentive Bonus Plans -- Incorporated by reference to Exhibit 10(5) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2004.
10.32*	Written Description of Car Allowance Plan -- Incorporated by reference to Exhibit 10(6) of the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2004.
10.33*	Written Description of Directors Fees Pursuant To Item 601(b)(10)(iii)(A) of Regulation S-K--Incorporated by reference to Exhibit 10(41) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2005.
10.34	Lease Agreement, dated March 17, 2004 between University Research Park, Incorporated, and Mentor Corporation covering 535 Science Drive, Suites A, B, C and D, Madison, Wisconsin --Incorporated by reference to Exhibit 10(42) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2005.
10.35*	Severance Agreement and Release dated February 16, 2005, between Mentor Corporation and Christopher J. Conway -- Incorporated by reference to Exhibit 10(43) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2005.

90

EXHIBIT INDEX (continued)

Item Number
10.36*	Severance Agreement and Release dated February 17, 2005, between Mentor Corporation and Adel Michael -- Incorporated by reference to Exhibit 10(44) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2005.
10.37*	Release of Claims Agreement dated March 25, 2005, between Mentor Corporation and Bobby Purkait -- Incorporated by reference to Exhibit 10(45) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2005.
10.38*	Summary Description of Executive Officer Employment Agreement Changes approved by the Board of Directors dated April 27, 2005 -- Incorporated by reference to Exhibit 10(46) of the Registrant's Annual Report on Form 10-K for the year ended March 31, 2005.
10.39	Credit Agreement dated May 25, 2005, between Mentor Corporation, Bank of the West, Union Bank of California, and Wells Fargo, N.A. -- Incorporated by reference to Exhibit 99(1) of the Registrant's Current Report on Form 8-K filed June 1, 2005.
10.40	English translation of RaboBank Loan and Overdraft Facility dated September 30, 2005 -- Incorporated by reference to Exhibit 10.1 of the Registrant's Current Report on Form 8-K filed on October 11, 2005.
10.41*	Mentor Corporation 2005 Long-Term Incentive Plan Restricted Stock Award Agreement.
10.42	First Amendment to Credit Agreement dated as of May 31, 2006, amending that certain Credit Agreement, dated as of May 25, 2005, by and among the Company, Bank of the West, as administrative agent, Union Bank of California, N. A., as syndication agent, Wells Fargo Bank, National Association, as documentation agent, and the lenders from time to time party thereto. -- Incorporated by reference to Exhibit 10.1 of the Registrant's Current Report on Form 8-K filed on June 6, 2006.
21	Subsidiaries of the Company.
23	Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.
31.1	Rule 13a-15(e) and 15d-15(e) Certification - Principal Executive Officer - Joshua H. Levine.
31.2	Rule 13a-15(e) and 15d-15(e) Certification - Principal Financial Officer - Loren L. McFarland.
32.1	Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Joshua H. Levine.
32.2	Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Loren L. McFarland.
* Management contract or compensatory plan or arrangement.

91

EX-2

EXHIBIT 2.1

Coloplast A/S
Holtedam 1
3050 Humlebæk
Copenhagen, DENMARK

March 27, 2006

Mentor Corporation
201 Mentor Drive
Santa Barbara, California 94311
USA
Attention: Joshua H. Levine, President and Chief Executive Officer

Ladies and Gentlemen:

We are pleased to make this binding offer (the "Offer") to purchase the Urology Business (as defined below) from Mentor Corporation (including the European subsidiaries operating the Urology Business) for a consideration of $463,225,000 of which $456,137,500 will be in cash and the remainder as other non-cash consideration as described herein (such purchase and sale of the Urology Business, if any, referred to herein in as the "Transaction").  The Transaction would be on a cash free, debt free basis with working capital consistent with historical levels as we have discussed.

If and when you accept the Offer, we will execute a definitive agreement relating to the Transaction.  The conditions to the completion of the Transaction would be as follows:

(a)  Delivery of conveyance documents for the European subsidiaries and the transferred assets;
(b)  Receipt of required regulatory approvals;
(c)  Absence of laws and injunctions restricting, or government litigation seeking to restrict, the purchase;
(d)  Accuracy of your representations and warranties regarding the Urology Business, except as would not have a Material Adverse Effect (as defined below) and material compliance with your covenants;
(e)  Delivery of certain closing documents; and
(e)  Absence of any Material Adverse Effect on the Urology Business.

This Offer presumes the following additional terms:

We would extend offers of employment to all of the employees of the Urology Business.

Pending the Closing, you would generally operate your business in the ordinary course consistent with past practice.

Your representations and warranties regarding the Urology Business would (i) survive for a period of 18 months following closing, (ii) be subject to maximum liability in the event of breach equal to 15% of the purchase price, (iii) be subject to an individual de minimus claim amount of $100,000 and (iv) be subject a threshold of $1,000,000, after which we would be entitled to recover all losses.  However, (i) representations concerning product liability would survive for twelve months, and (ii) representations concerning certain title matters and sufficiency of assets would survive for ten years and not be subject to the foregoing limitations, but liability in any event under the contract would be limited to the purchase price and would not include consequential, punitive or special damages or diminution in value.

We would indemnify you for assumed liabilities of the Urology Business and you would indemnify us for excluded liabilities, without limitations on recovery.  Product liability claims made during the first seven years for products sold by you would be excluded liabilities; product liability claims made after seven years for products sold by you would be assumed liabilities.  We would pay you $300,000 per year, on a semi-annual basis, in connection with certain product liability claims.  In addition, you would indemnify us for any product liability for your sale of ObTape® products (we would not purchase the ObTape product line).  We would assume all environmental liabilities;

1

provided, however, that you would agree to indemnify us for: (i) losses for environmental claims made during the five year period post-closing with respect to your Minneapolis property; (ii) losses for environmental claims made during the four year period post-closing with respect to your other transferred properties that were in existence at closing and were caused by you; and (iii) 50% of losses for all other environmental claims made during the four year period post-closing with respect to your other transferred properties.  Our rights to indemnification would terminate if we conduct additional environmental testing on any transferred real property except where required by law or in certain other specified circumstances.  You would cooperate with us to obtain insurance naming you and Coloplast as insured parties with respect to your environmental indemnification obligations.

The indemnifying party (including for breach of representations and warranties) would be entitled to notice of, control the defense of and settle, third party claims.

As we have discussed, our Offer for the Transaction does not include the purchase of Mentor's infrastructure and general and administrative assets, and assumes you would provide transition services arrangements, including leases, to us for a limited period of time in order for us to promptly transition the Urology Business to our infrastructure.  You and we would also provide for continued supply to each other of materials currently supplied between your remaining business and the Urology Business.

In addition, as other non-cash consideration we would pay you $7,087,500 corresponding to 90% of the foreign tax credits attributable to the sale of intellectual property from your Porges subsidiary to us prior to the closing (such tax credits equal to $7,875,000) that are determined to be unavailable following an audit or promulgation of a treasury regulation disallowing such credits and for certain other reductions in the foreign tax credits.

We would establish an escrow out of the purchase price of $10,000,000 for a period of 18 months solely to secure your indemnification obligations with respect to breaches of representations and warranties.

You would agree not to enter into or engage in a business that competes with the Urology Business, on a worldwide basis, for a period of seven years following the closing.  A competing business would not include (1) the developing, manufacturing, marketing, selling, importing or distributing of (A) any oral pharmaceuticals or (B) any product or treatments involving dermal fillers or other bulking agents or toxins, including botulinum toxins, for any indication or application, including any urologic indication or application; or (2) any businesses acquired and operated by you for so long as such businesses generate less than $5,000,000 in aggregate annual revenues from any competing business.

"Urology Business" means your surgical urology and consumer and clinical healthcare operating segments, whether conducted by you or your subsidiaries, and consisting of the following diversified product portfolio of surgical and non-surgical products, that provide solutions for a broad range of urological problems:

        (a)        the catheter products and operations, selling the following products for the management of bladder control and urinary retention: (i) the Self-Cath® brand line of intermittent catheters both with and without the Self-Cath HydroGel™, (ii) the Freedom® brand line of latex and latex free male external catheters, and (iii) catheter accessories, including leg bags, deodorizers and moisturizers;

        (b)        the disposable urology products and operations, selling the following products for both hospital and outpatient settings for thee management of urinary tract obstruction, urinary incontinence, or urinary retention: (i) urethral stents and catheters, dilators and guidewires, (ii) stone extractors, (iii) prostatic catheters and prostatic stents, (iv) urethral stents, (v) bladder drainage catheters, (vi) Foley catheters, (vii) bladder injection needles (currently under development), and (viii) general surgical devices including Elephants/Easivac;

        (c)        clinical or consumer ostomy care products;

        (d)        the women's health products and operations, selling the following surgically implantable products for the treatment of incontinence and pelvic organ prolapse: (i) synthetic slings for the surgical treatment of stress urinary incontinence under the brand Aris™, (ii) tissue-based slings and grafts for the surgical treatment of pelvic organ prolapse under the brands Axis™ and Suspend®, (iii) pelvic floor synthetic mesh systems for the treatment of cystocele and rectocele pelvic organ prolapse, (iv) minimally invasive office-based endometrial ablation product called Selene® for the treatment of excessive menstrual bleeding, and (v) the soon to be released NovaSilk™ synthetic mesh for treatment of pelvic organ prolapse;

 2

        (e)        the men's health products and operations, selling the following surgically implanted penile implants for the treatment of erectile dysfunction: (i) the Titan® three-piece inflatable penile implant, (ii) the Genesis™ one-piece malleable penile implant, (iii) One-Touch Pump development project to enhance the Titan, (iv) Excel® two-piece implant product, development efforts and operations, and (v) testicular implants; and

        (f)        the brachytherapy products and operations, consisting of the following radioisotope products and loading products, supplies and systems for the treatment of prostate cancer: (i) the Iodine‑I‑125 radio isotope brachytherapy seed, (ii) the Palladium-Pd‑103 radio isotope brachytherapy seed, (iii) Isoloader® all-in-one workstation automated needle loading, seed assay and reporting, and (iv) IsoStrand® automated stranding device.

The Urology Business would not include any product or treatments involving dermal fillers or other bulking agents or toxins, including botulinum toxins, for any indication or application, and you would not be restricted from competing in any area for these products and treatments including any urologic indication or application.  The Urology business would include the facilities in Minneapolis and Oklahoma City and leases for specified properties throughout the world, but would not include and we would not purchase your Anoka facility and the assets related thereto.  We would negotiate in good faith to reach agreement with you and Rochester Medical Corporation to effectuate the term sheet among us relating to silicone male external catheters, but if we were unable to reach such agreement you would supply us Silicone Male External Catheters from the Anoka facility.

"Material Adverse Effect" means any change, event, state of facts, or effect (each an "Effect") that is materially adverse to the Urology Business; provided, however, that none of the following shall be deemed, either alone or in combination, to constitute a Material Adverse Effect: any Effect resulting from or arising out of (a) the announcement of this Offer or the pendency of the transactions contemplated hereby, including actions taken in connection with the separation of the Urology Business in furtherance of the transactions contemplated hereby, (b) the performance by a party of its obligations in connection with the transaction or as required by applicable laws or accounting requirements, (c) general economic conditions in any country where the Urology Business is conducted that do not disproportionately and adversely affect the Urology Business in any material respect, (d) general conditions in any industry in which the Urology Business is conducted that do not disproportionately and adversely affect the Urology Business in any material respect, (e) any natural disaster or any acts of terrorism, sabotage, military action or war (whether or not declared) or any escalation or worsening thereof, (f) certain environmental conditions at all properties owned, leased or occupied at any time by your or any of your subsidiaries in connection with the Urology Business, or (g) any Effect for which an adjustment to the purchase price with respect to working capital is required to be made.

This Offer is binding on us and will be irrevocable, non-retractable and capable of acceptance by you until 11:59 p.m. California time on July 31, 2006 in consideration of your execution of the letter agreement regarding a period of exclusive negotiations we have provided to you of even date herewith.

Extrinsic (parole) evidence, including the discussions and correspondence between us, may be considered in the interpretation of this binding Offer.  This binding Offer has been duly authorized by Coloplast, and, to our knowledge, does not conflict with any of Coloplast's agreements or any applicable legal requirement.

We confirm that monetary damages may be inadequate to compensate you for a breach by us of this Offer.  Accordingly, we agree and acknowledge that, in addition to any other remedies that may be available, in law, in equity or otherwise, you shall be entitled to seek injunctive relief against breaches of this Offer.  This Offer is subject to Minnesota law (without regard to conflicts of laws principles).  We hereby consent to the jurisdiction of any federal or state court within Minnesota and agree not to assert that any such forum is not convenient or lacks jurisdiction.

Very truly yours,

COLOPLAST A/S

By:   /s/ Sten Scheibye                   
        Sten Scheibye
        Chief Executive Officer

3

EX-2

EXHIBIT 2.2

Coloplast A/S
Holtedam 1
3050 Humlebæk
Copenhagen, DENMARK

May 5, 2006

Mentor Corporation
201 Mentor Drive
Santa Barbara, California 94311
USA
Attention: Joshua H. Levine, President and Chief Executive Officer

Ladies and Gentlemen:

On March 27, 2006, we presented you with a binding offer (the "Original Offer") to purchase the Urology Business (as defined in the Original Offer) from Mentor Corporation (including the European subsidiaries operating the Urology Business) for a consideration of $463,225,000 of which $456,137,500 would be in cash and the remainder as other non-cash consideration as described therein (such purchase and sale of the Urology Business, if any, referred to herein as the "Transaction").  In consideration of your willingness to participate in discussions with Rochester Medical Corporation ("RMC") regarding the potential sale by us to RMC of Mentor Medical Limited following consummation of the Transaction and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, we hereby modify the Original Offer on the terms set forth herein.

Attached hereto as Appendix A is a proposed definitive agreement relating to the Transaction contemplated by the Original Offer (the proposed definitive agreement, together with the exhibits, schedules and disclosure letter referenced in and attached to the proposed definitive agreement, are referred to herein as the "Proposed Agreement").  We hereby offer to purchase the Business (as defined in the Proposed Agreement) pursuant to, and on the terms and subject to the conditions set forth in, the Proposed Agreement, which is incorporated by reference in and made a part of this letter (this letter, together with the Proposed Agreement, the "Offer"). 

This Offer is binding on us and will be irrevocable, non-retractable and capable of acceptance by you until 11:59 p.m. California time on July 31, 2006.

This Offer supersedes all prior offers, agreements and understandings, written and oral, with respect to the subject matter hereof (including the Original Offer but excluding that certain letter agreement with us dated March 27, 2006 regarding a period of exclusive negotiations and that certain confidentiality agreement between Citigroup Global Markets Inc., on your behalf, and us dated October 27, 2005).  Extrinsic (parole) evidence, including the discussions and correspondence between us, may not be considered in the interpretation of this binding Offer.  This binding Offer has been duly authorized by Coloplast, and, to our knowledge, does not conflict with any of Coloplast's agreements or any applicable legal requirement.

We confirm that monetary damages may be inadequate to compensate you for a breach by us of this Offer.  Accordingly, we agree and acknowledge that, in addition to any other remedies that may be available, in law, in equity or otherwise, you shall be entitled to seek injunctive relief against breaches of this Offer.  This Offer is subject to Minnesota law (without regard to conflicts of laws principles).  We hereby consent to the jurisdiction of any federal or state court within Minnesota and agree not to assert that any such forum is not convenient or lacks jurisdiction.

Very truly yours,

COLOPLAST A/S

By: /s/ Sten Scheibye       
Sten Scheibye
Chief Executive Officer

APPENDIX A

PROPOSED AGREEMENT

TABLE OF CONTENTS
		Page
Article 1 DEFINITIONS		1
Article 2 PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES		22
2.1	Transferred Assets; Transferred IPR	22
2.2	Assumed Liabilities	22
2.3	Conveyances	23
2.4	Net Working Capital Adjustment	23
2.5	No Withholding	25
Article 3 CLOSING		25
3.1	The Closing	25
3.2	Deliveries by Seller	25
3.3	Deliveries by Buyer	26
Article 4 INTELLECTUAL PROPERTY LICENSES		27
4.1	Licensed IPR	27
4.2	License‑Back Patents	28
4.3	Limitations	28
4.4	License-Back Other IPR	28
4.5	Reservation of Rights	29
4.6	Trade Secret Protection and Use	29
4.7	Transfer	29
4.8	Products Outside of Licensed Field and License-Back Field	29
4.9	Bulking Agent and/or Toxin	30
4.1	Exclusive Patent	30
4.11	License to Transition Marks	30
Article 5 REPRESENTATIONS AND WARRANTIES OF SELLER		31
5.1	Organization and Authority	31
5.2	Transferred Subsidiaries; Capitalization	32
5.3	No Violation	33
5.4	Compliance with Laws; Business Permits	33
5.5	No Broker	34
5.6	Absence of Changes	34
5.7	Contracts	35
5.8	Taxes	36
5.9	Transferred Tangible Assets	37
5.1	Transferred Contracts; Subsidiary Contracts	38
5.11	Intellectual Property	38
5.12	Financial Statements and Reports	40
5.13	Benefit Plan Compliance	40
5.14	Labor Matters	42
5.15	Properties	43
5.16	Environmental Matters	44
5.17	Transferred Inventory	44
5.18	Accounts Receivable	45
5.19	Litigation	45
5.2	Products Liability	45
5.21	Customers and Suppliers	46

-i-

TABLE OF CONTENTS
(Continued)
		Page
5.22	Compliance With Health Care Laws	46
5.23	FDA and Global Regulation Compliance	47
5.24	Restrictions on Business Activities	49
5.25	Sufficiency	49
5.26	Exclusive Warranties	49
5.27	Insurance	50
5.28	Compliance with Conduct of Business Covenant	50
Article 6 REPRESENTATIONS AND WARRANTIES OF BUYER		50
6.1	Organization of Buyer	50
6.2	Authorization	50
6.3	No Violation	51
6.4	Government Consents	51
6.5	Purchase for Investment; Accredited Investor	51
6.6	No Broker	51
6.7	Financing	51
6.8	Litigation	52
Article 7 EMPLOYEE TRANSFERS AND BENEFITS		52
7.1	Voluntary Transfer Employees	52
7.2	Automatic Transfer	54
7.3	Compensation and Benefits	54
7.4	Information and Consultation	55
7.5	Severance	55
7.6	Employment‑Related Assumed Liabilities	56
7.7	Employment-Related Excluded Liabilities	56
7.8	Timing of Claims Incurred	56
7.9	Retention Payment	57
Article 8 ADDITIONAL COVENANTS		57
8.1	Contracts	57
8.2	Conduct of the Business	58
8.3	Access to Information	60
8.4	Books and Records	60
8.5	Necessary Efforts; HSR Filings	61
8.6	Taxes and Costs Relating to the Porges Asset Sale	62
8.7	Tax Matters	63
8.8	Allocation of Purchase Price	65
8.9	Return of Excluded Assets	65
8.1	Brokers	66
8.11	Further Assurances	66
8.12	Mail Handling	66
8.13	Non‑Solicitation	67
8.14	Pre-Closing Integration Planning	67
8.15	Confidentiality	68
8.16	Non-Competition	68
8.17	Real Estate Matters	69
8.18	Licensed Patent Schedule	72
8.19	Name Change	72

-ii-

TABLE OF CONTENTS
(Continued)
		Page
8.2	Business Permits	72
8.21	Environmental Insurance	73
8.22	Transition Services Agreement	73
8.23	Product Liability	73
8.24	Supply of SMEC Products	73
8.25	Escrow Agreement	75
8.26	Porges Asset Sale	75
8.27	ABISS	76
8.28	Intercompany Contracts and Balances	76
Article 9 CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE		76
9.1	Seller Closing Deliverables	76
9.2	Performance	77
9.3	Regulatory Approvals	77
9.4	No Injunction or Restraints; Illegality	77
9.5	Officer's Certificate	77
9.6	Representations and Warranties	77
9.7	No Seller Material Adverse Effect	77
9.8	Transition Services Agreement	77
Article 10 CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS TO CLOSE		78
10.1	Buyer Closing Deliverables	78
10.2	Performance	78
10.3	Regulatory Approvals	78
10.4	No Injunction or Restraints; Illegality	78
10.5	Officer's Certificate	78
10.6	Representations and Warranties	79
10.7	Sufficient Funds	79
10.8	No Buyer Material Adverse Effect	79
10.9	UK OFT Undertakings	79
Article 11 INDEMNITY		79
11.1	Survival	79
11.2	Buyer Indemnification	80
11.3	Seller Indemnification	80
11.4	Procedures	84
11.5	Limitation on Recovery	85
11.6	Duty to Mitigate	85
11.7	Escrow Fund	86
11.8	Indemnity is the Exclusive Remedy	86
11.9	Assignment of Claims	86
11.1	No Set‑Off	86
Article 12 TERMINATION		86
12.1	Term	86
12.2	Termination	86
12.3	Notice of Termination	87
12.4	Effect of Termination	87

 

-iii-

TABLE OF CONTENTS
(Continued)
		Page
Article 13 GENERAL PROVISIONS		88
13.1	Notices	88
13.2	Currency	89
13.3	Sections and Headings	89
13.4	Rules of Construction	89
13.5	Construction	90
13.6	Entire Agreement	90
13.7	Governing Law; Jurisdiction and Venue; Arbitration of Indemnification Disputes; Injunctive Relief	90
13.8	Waiver of Jury Trial	91
13.9	Public Announcement	91
13.1	Expenses	91
13.11	Exclusion of Certain Damages	91
13.12	Severability	92
13.13	Successors and Assigns	92
13.14	Amendment and Waivers	92
13.15	Counterparts	92

 

-iv-

INDEX OF EXHIBITS
Exhibit	Description
A	Form of Assignment and Assumption Agreement
B	Form of Bill of Sale
C	Transition Services Agreement
D	Balance Sheet and Net Working Capital Spreadsheet
E-1	Form of Patent Assignment
E-2	Form of Trademark Assignment
F	Preliminary Purchase Price Allocation
INDEX OF SCHEDULES
Schedule	Description
Schedule 1.6	Assumed Liabilities
Schedule 1.59	Excluded Assets
Schedule 1.60	Excluded Liabilities
Schedule 1.79	Infrastructure Assets
Schedule 1.84(a)	Individuals (Knowledge)
Schedule 1.84(b)	Individuals (Knowledge)
Schedule 1.94	Licensed Patents
Schedule 1.104	Net Working Capital
Schedule 1.115	Permitted Encumbrances - U.S. Real Property
Schedule 1.125(a)	Products (Existing)
Schedule 1.125(b)	Products (Under Development)
Schedule 1.161	Subsidiary Real Property
Schedule 1.166	Third Party Licenses
Schedule 1.173	Transferred Contracts
Schedule 1.174	Transferred Copyrights
Schedule 1.178	Transferred Internet Properties
Schedule 1.181(a)	Transferred Marks
Schedule 1.181(b)	Non-Transferred Marks
Schedule 1.182	Transferred Patents
Schedule 1.183	Transferred Real Property
Schedule 1.184	Transferred Subsidiaries
Schedule 1.186	Transferred Tangible Assets
Schedule 3.2(g)	Foreign Conveyance Jurisdictions
Schedule 3.2(m)	Released Encumbrances
Schedule 7.1(a)	Employees
Schedule 8.2(a)	Exceptions to Conducting Business in Ordinary Course
Schedule 8.2(b)	Exceptions to Taking of Prohibited Actions
Schedule 8.17(b)	Summary of Space-Sharing Terms - 201 and 301 Mentor Drive
Schedule 8.21	Environmental Insurance
Schedule 8.24(a)	Rochester Medical Corporation Term Sheet
Schedule 9.3	Regulatory Approvals
Schedule 11.3(a)	Seller Indemnification Matters

-v-

THIS PURCHASE AGREEMENT (this "Agreement"), is entered into and made as of _______ __, 2006, by and between Mentor Corporation, a Minnesota corporation ("Seller"), and Coloplast A/S, a Danish corporation ("Buyer") (Buyer and Seller may hereinafter be referred to individually as a "Party" and collectively as the "Parties").

WITNESSETH:

WHEREAS, Seller is engaged, directly and through Subsidiaries, in the Business (as defined below); and

WHEREAS, upon and subject to the terms and conditions set forth herein, Seller desires to sell to Buyer and Buyer desires to purchase from Seller, certain of the assets of Seller, including the Equity Interests (as defined below) of the Transferred Subsidiaries (as defined below), related to the Business (as defined below), and Seller desires to transfer to Buyer and Buyer desires to assume from Seller and the Transferred Subsidiaries, certain of the liabilities related to the Business;

WHEREAS, it is the intention and desire of Seller, by this Agreement, to divest itself of, and transfer to Buyer, or otherwise provide Buyer the benefit of, the Business and all rights thereof; and

WHEREAS, accordingly, Seller will, by the terms of this Agreement transfer, license or provide by means of services agreements, to Buyer Seller's tangible and intangible assets and rights used by Seller in the conduct of the Business and necessary for Buyer to conduct the Business following the Closing (as defined below); and

WHEREAS, concurrently with the execution hereof, Seller and Buyer are entering into a Transition Services Agreement (as defined below) that provides for integration planning and transition services with respect to the conveyance of the Business from Seller to Buyer as contemplated by the terms hereof.

NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises herein made, and in consideration of the covenants, representations, warranties, conditions and agreements herein contained, Buyer and Seller hereby agree as follows:

Article 1

DEFINITIONS

(i)         As used in this Agreement, the following terms shall have the meanings specified or referred to in this Article 1.

1.1              "AAA" has the meaning set forth in Section 0.

1.2              "Acquired Entity" has the meaning set forth in Section 8.16.

1

1.3              "Affiliate" means any entity which controls, is controlled by, or is under common control with, Seller or Buyer, as the case may be.  An entity shall be deemed to be in control of another entity only if, and for so long as, it owns or controls more than 50% of the voting power in the election of directors (or, in the case of an entity that is not a corporation, for the election of the corresponding managing authority) of such other entity.

1.4              "Agreement" has the meaning set forth in the first paragraph of this Agreement together with all schedules and exhibits attached hereto.

1.5              "Assigned Leases" has the meaning set forth in Section 5.15(a).

1.6              "Assumed Liabilities" means the Liabilities of Seller and its Subsidiaries identified on Schedule 1.6.

1.7              "Assumption Agreement" means an Assignment and Assumption Agreement in substantially the form set forth in Exhibit A (subject to substitution in certain cases by the Conveyance Documents pursuant to Section 2.3).

1.8              "Automatic Transfer Employees" means those Employees of Transferred Subsidiaries whose Contracts of employment automatically transfer to Buyer (or a Subsidiary thereof) in accordance with applicable Laws in connection with the transactions contemplated by this Agreement.

1.9              "Bills of Sale" means Bills of Sale in substantially the form set forth in Exhibit B (subject to substitution in certain cases by the Conveyance Documents pursuant to Section 2.3).

1.10          "Business" means the surgical urology and consumer and clinical healthcare operating segments of Seller, whether conducted by Seller or its Subsidiaries, and consisting of the following diversified product portfolio of surgical and non-surgical products, that provide solutions for a broad range of urological problems:

(a)        the catheter products and operations, selling the following products for the management of bladder control and urinary retention: (i) the Self-Cath® brand line of intermittent catheters both with and without the Self-Cath HydroGel™, (ii) the Freedom® brand line of latex and latex free male external catheters, and (iii) catheter accessories, including leg bags, deodorizers and moisturizers;

(b)        the disposable urology products and operations, selling the following products for both hospital and outpatient settings for the management of urinary tract obstruction, urinary incontinence, or urinary retention: (i) urethral stents and catheters, dilators and guidewires, (ii) stone extractors, (iii) prostatic catheters and prostatic stents, (iv) urethral stents, (v) bladder drainage catheters, (vi) Foley catheters, (vii) bladder injection needles (currently under development), and (viii) general surgical devices including Elephants/Easivac;

(c)        clinical or consumer ostomy care products;

2

(d)        the women's health products and operations, selling the following surgically implantable products for the treatment of incontinence and pelvic organ prolapse: (i) synthetic slings for the surgical treatment of stress urinary incontinence under the brand Aris™, (ii) tissue-based slings and grafts for the surgical treatment of pelvic organ prolapse under the brands Axis™ and Suspend®, (iii) pelvic floor synthetic mesh systems for the treatment of cystocele and rectocele pelvic organ prolapse, (iv) minimally invasive office-based endometrial ablation product called Selene® for the treatment of excessive menstrual bleeding, and (v) the soon to be released NovaSilk™ synthetic mesh for treatment of pelvic organ prolapse;

(e)        the men's health products and operations, selling the following surgically implanted penile implants for the treatment of erectile dysfunction: (i) the Titan® three-piece inflatable penile implant, (ii) the Genesis™ one-piece malleable penile implant, (iii) One-Touch Pump development project to enhance the Titan, (iv) Excel® two-piece implant product, development efforts and operations, and (v) testicular implants; and

(f)         the brachytherapy products and operations, consisting of the following radioisotope products and loading products, supplies and systems  for the treatment of prostate cancer: (i) the Iodine-I-125 radio isotope brachytherapy seed, (ii) the Palladium-PD-103 radio isotope brachytherapy seed, (iii) Isoloader® all-in-one workstation automated needle loading, seed assay and reporting, and (iv) IsoStrand® automated stranding device. 

1.11          "Business Competitor" means that part of any Person engaged, directly or indirectly, in a Competing Business.

1.12          "Business Day" means a day, other than Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by Law to close.

1.13          "Business Permits" has the meaning set forth in Section 5.4.

1.14          "Buyer" has the meaning set forth in the first paragraph of this Agreement.

1.15          "Buyer Benefits Plans" means the Employee Benefits Plans of Buyer (or a Subsidiary thereof), as amended from time to time, under which some or all of the Employees will be eligible to participate following the Closing.

1.16          "Buyer Indemnified Parties" has the meaning set forth in Section 11.3(a).

1.17          "Buyer Employment Liabilities" has the meaning set forth in Section 7.6.

3

1.18          "Buyer Material Adverse Effect" means any change that is materially adverse to the net assets or financial condition of Buyer and its Subsidiaries taken as a whole or to the ability of Buyer to consummate the transactions contemplated hereby or any agreements delivered or entered into in connection herewith.  For the avoidance of doubt, "Buyer Material Adverse Effect" does not include any requirement by Buyer to divest, license, hold separate (through the establishment of a trust or otherwise) or otherwise dispose, or agree to dispose, of assets as, or if, required to avoid or overcome the objections of the UK Competition Authorities to the transactions contemplated by this Agreement or to comply with the UK OFT Undertakings.

1.19          "Buyer Subsidiaries" has the meaning set forth in Section 2.3.

1.20          "Cause" means (a) a Transferred Employee's breach of any trade secret or any confidential information agreement with Buyer (or a Subsidiary thereof), or written policy of Buyer or a Subsidiary thereof, (b) willful misconduct by a Transferred Employee, which is determined in good faith by Buyer to be injurious to the business of Buyer, (c) the conviction of, or entry of a guilty plea by, a Transferred Employee for the commitment of, a crime of moral turpitude (d) substance abuse including alcohol, (e) repeated and documented neglect of duty, (f) taking an action for the purpose of harming the Buyer or its business, (g) noncompliance with applicable Law in a manner that is injurious to the business of Buyer, (h) fraud or intentional misrepresentation, (i) continual, significant absenteeism, or (j) in any pertinent jurisdiction outside the United States, any action giving grounds for dismissal under applicable Laws, as applied to any Employee of a Transferred Subsidiary. 

1.21          "Change of Control" means, with respect to a Party, a transaction or series of related transactions that would directly or indirectly: (a) result in or have the effect of a third Person obtaining legal or beneficial ownership of more than 50% of the voting shares (or other voting interests) of such Party (even if such Party is the surviving entity, such as in the case of a reverse triangular merger); or (b) result in the sale, transfer, assignment, exclusive license or other disposition of all or substantially all of the Party's assets; other than, in the case of (a), a transaction pursuant to which the shareholders of such Party immediately prior to the relevant transaction continue to beneficially own at least 50% of the voting shares (or other voting interests) of such Party or its direct or indirect parent entity immediately following such transaction.

1.22          "Closing" has the meaning set forth in Section 3.1.

1.23          "Closing Date" has the meaning set forth in Section 3.1.

1.24          "Closing Date Balance Sheet" has the meaning set forth in Section 2.4(a).

1.25          "Closing Date Net Working Capital Statement" has the meaning set forth in Section 2.4(a).

1.26          "Closing Statements" has the meaning set forth in Section 2.4(a).

1.27          "Code" means the Internal Revenue Code of 1986, as amended.

4

1.28          "Competing Business" means (1) the developing, manufacturing, marketing, selling, importing or distributing any or all of the following products: (a) surgically implantable substances, prostheses or other devices for the treatment of male impotence or erectile dysfunction; (b) substances, prostheses or other devices to replace or simulate the testicle; (c) clinical or consumer healthcare products for the management of urinary retention or incontinence, including external or internal catheters and adult incontinence diapers (but not baby diapers); (d) clinical or consumer ostomy care products; (e) surgically implantable (i) substances, (ii) prostheses or (iii) other devices, for the treatment of kidney or ureter stones, kidney or urethral obstructions, urinary retention or incontinence, or pelvic organ prolapse; (f) devices or methods to instill substances or devices in the uterus for the purpose of treating excessive endometrial bleeding; and (g) brachytherapy products, devices or substances for use or application in the Licensed Field, and/or (2) the wholesale or retail service of providing any or all of the above products to consumers or healthcare providers.  Notwithstanding the foregoing, however, a "Competing Business" shall not include: (1) the developing, manufacturing, marketing, selling, importing or distributing of (A) any oral pharmaceuticals or (B) any product or treatments involving dermal fillers or other bulking agents or toxins, including botulinum toxins, for any indication or application, including any urologic indication or application; or (2) any business(es) acquired (and thereafter operated) by Seller or its Affiliates for so long as such business(es) generate(s) less than $5,000,000 in aggregate annual revenues from any Competing Business.

1.29          "Confidentiality Agreement" means that certain agreement between Citigroup Global Markets Inc., on behalf of Seller, and Buyer dated October 27, 2005. 

1.30          "Consensual Transfers" has the meaning set forth in Section 0.

1.31          "Consent" has the meaning set forth in Section 0.

1.32          "Constructive Termination" shall mean only a resignation of an Employee's employment within forty-five (45) days after the occurrence of any of the following events: (i) a material reduction in the Employee's responsibilities, provided that a change of title shall not constitute such a material reduction; (ii) a reduction in the Employee's base salary, other than a one-time reduction that applies to substantially all other employees of Buyer; or (iii) a relocation of the Employee's principal office to a location more than fifty (50) miles from the location of the Employee's principal office prior to such relocation in any case when the terms of employment made to the Employee by Buyer did not indicate that the Eligible Employee would be relocated to a principal office outside such fifty (50) mile radius; and provided in all the above cases the Buyer has failed to cure the facts and circumstances giving rise to the Constructive Termination within fifteen (15) days after receipt of notice of such resignation.

1.33          "Contracts" means all contracts, binding agreements, options, leases, licenses, sales, binding commitments and other similar instruments, whether oral or written.

1.34          "Conveyance Documents" has the meaning set forth in Section 2.3.

1.35          "Copyrights" has the meaning set forth in Section 0.

1.36          "Covenant Breach" means with respect to a Party, a breach of, nonfulfillment or failure to comply with a covenant or agreement made or to be performed pursuant to this Agreement or any other Operative Agreement by such Party or a Subsidiary thereof.

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1.37          "CPA Firm" has the meaning set forth in Section 2.4(c).

1.38          "Disclosure Letter" has the meaning set forth in the introduction to Article 5.

1.39          "DOJ" has the meaning set forth in Section 0.

1.40          "Downward Adjustment Amount" has the meaning set forth in Section 0.

1.41          "Effect" has the meaning set forth in Section 0.

1.42          "Eligible Employee" has the meaning set forth in Section 7.9.

1.43          "Employee Benefits Plan" means, and whether written or oral: (a) any plan, fund, agreement or program which provides health, medical, surgical, hospital, vision or dental care or other welfare benefits, or benefits in the event of sickness, accident or disability, or death benefits, apprenticeship or other training programs, or day care centers, scholarship funds, or prepaid legal services; (b) any plan, fund, agreement or program which provides retirement income to Employees or results in a deferral of income by Employees for periods extending to the termination of covered employment or beyond; (c) any plan, fund, agreement, practice or program which provides severance, unemployment, vacation or fringe benefits (including dependent and health care accounts); (d) any incentive compensation plan, deferred compensation plan, stock option or stock‑based incentive or compensation plan, or stock purchase plan; (e) any other "employee pension benefit plan" (as defined in Section 3(2) of ERISA), any other "employee welfare benefit plan" (as defined in Section 3(1) of ERISA); and (f) any other written or oral plan, agreement or arrangement involving direct or indirect compensation including insurance coverage, severance benefits, disability benefits, fringe benefits, pension or retirement plans, profit sharing, deferred compensation, bonuses (including any sale bonuses), stock options, stock purchase, phantom stock, stock appreciation or other forms of incentive compensation or post‑retirement compensation, as well as any change in control agreements, managing director agreements and other retention arrangements.

1.44          "Employees" means those individuals who are employed by (a) a Transferred Subsidiary, or (b) Seller or a Subsidiary thereof and who are primarily engaged in or dedicated to the Business and, in both cases (a) and (b) to be listed on Schedule 7.1(a) (as may be updated by Seller as of or prior to the Closing, subject to the consent of Buyer (such consent not to be unreasonably withheld, delayed or conditioned), to reflect as of the Closing Date those Employees who are primarily engaged in or dedicated to the Business).

1.45          "Encumbrance" means any lien, claim, charge, license, security interest, mortgage, pledge, easement, conditional sale or other title retention agreement, defect in title, covenant or other restrictions of any kind, other than a Permitted Encumbrance.

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1.46          "End Date" means the date that is three months from the date hereof (or such later date as may be mutually agreed to by the Parties); provided, however, that if on or within 60 days prior to the End Date, Buyer has notified Seller that a Covenant Breach and/or a Warranty Breach has occurred with respect to Seller, then the End Date shall be automatically extended for such number of days as is necessary to provide Seller the full 60-day period to cure such breach from the date of notice pursuant to Section 12.2(c).

1.47          "Enforceability Exceptions" has the meaning contained in Section 5.1(c).

1.48          "Environmental Claim" means any actual or threatened complaint, judgment, demand, legal action, administrative proceeding, lien, order, directive, claim, citation or assessment made, presented, sought or alleged by any Person and that (i) arises out of events, acts or conditions existing on or prior to the Closing, (ii) relates to the Business or the Transferred Assets or the use, ownership or operation thereof, and (iii) arises under any Environmental Law.  Environmental Claims include any and all (x) enforcement, clean-up, Response Actions or other governmental regulatory actions initiated, completed, pending or threatened, (y) claims made, threatened or prosecuted by any third party, and (z) proceedings for the recovery of any damages, indemnification, contribution, cost recovery, compensation, Losses or injury, including personal injury.

1.49          "Environmental Condition" means any Hazardous Substance that is present on or prior to the Closing in, under, on or about any real property used for the Business or otherwise comprising any of the Transferred Real Property and that (i) requires any Response Action pursuant to any Environmental Law, or (ii) constitutes an endangerment of health, safety, property or the environment pursuant to any Environmental Law, including the presence or Release, or threatened Release, of any Hazardous Substances into, on or under the air, soil, surface water, groundwater or other media.

1.50          "Environmental Laws" means any and all Laws anywhere in the world relating to worker health, safety, exposure of any individual to a Hazardous Substance or pollution or protection of the environment, including those relating to emissions, discharges, spills or other releases or threatened releases into or impacting the environment or natural resources (including ambient air, surface water, groundwater or land), or otherwise relating to the manufacture, processing, distribution, use, treatment, recycling, storage, disposal, transport, sale, offer for sale, distribution or handling of Hazardous Substances, including the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §§ 9601 et seq. ("CERCLA"), the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et seq., and the Occupational Safety and Health Act, 29 U.S.C. §§ 651 et seq., any amendments or successor statutes to any of the foregoing, and the rules, regulation, permits orders and decrees implementing the same and all analogous state and local laws, rules regulations, permits, orders and decrees. 

1.51          "Environmental Permits" means those Business Permits required to be held pursuant to Environmental Laws.

1.52          "Equity Interest" means capital stock, membership interests, options, warrants, stock appreciation rights, or rights to subscribe for, calls or other instruments exercisable for, or convertible into, the capital stock, membership interests or similar equity interests of any Person.

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1.53          "ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder.

1.54          "ERISA Affiliate" means any employer that is, or at any time for which any relevant statute of limitations remains open, was, together with Seller, treated as a "single employer" under section 414(b), section 414(c) or section 414(m) of the Code.

1.55          "Escrow Agent" means Nordea Bank Finland plc.

1.56          "Escrow Agreement" has the meaning set forth in Section 8.25.

1.57          "Escrow Amount" means an amount equal to $10,000,000.

1.58          "Escrow Fund" has the meaning set forth in Section 11.7.

1.59          "Excluded Assets" means the assets of Seller and its Subsidiaries and Affiliates that are not Transferred Assets, including those assets identified on Schedule 1.59.

1.60          "Excluded Liabilities" means any and all Liabilities of Seller and its Subsidiaries and Affiliates other than the Assumed Liabilities, including those Liabilities identified on Schedule 1.60.

1.61          "Exclusivity Agreement" means that certain letter agreement between Seller and Buyer dated March 27, 2006, relating to the transactions contemplated hereby.

1.62          "Existing Supply Agreement" means that certain Agreement between Seller, SSL International Plc and Buyer dated September 29, 2001, (novation to Distribution Agreement between Seller and SSL International Plc dated September 1, 2001).

1.63          "Expenses" means any and all reasonable expenses actually incurred in connection with investigating, defending or asserting any claim, action, suit or proceeding incident to any matter expressly indemnified against hereunder (including court filing fees, court costs, arbitration fees or costs, witness fees, and statutory or other reasonable and actual fees and disbursements of legal counsel, investigators, expert witnesses, consultants, accountants and other professionals).

1.64          "FDA" has the meaning set forth in Section 5.23(a).

1.65          "Final Balance Sheet" has the meaning set forth in Section 2.4(c).

1.66          "Final Net Working Capital Statement" has the meaning set forth in Section 2.4(c).

1.67          "Financial Statements" has the meaning set forth in Section 5.12.

1.68          "Foreign Benefit Plans" has the meaning set forth in Section 0.

1.69          "FTC" has the meaning set forth in Section 0.

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1.70          "GAAP" means Generally Accepted Accounting Principles as established and understood under accounting standards in the United States of America.

1.71          "Governmental Actions" means any authorizations, consents, approvals, waivers, exceptions, variances, franchises, permissions, permits, and licenses of, and filings, notifications or  declarations with, any Governmental Authority worldwide, including the United States, the European Union, Canada, Australia and Japan.

1.72          "Governmental Authority" means any national, supranational, local or foreign court, governmental or administrative agency or commission or other governmental agency, authority, instrumentality, notified body, competent authority, third party governmental designate or regulatory body having appropriate jurisdiction worldwide.

1.73          "Hazardous Substances" means any material, substance, chemical or emission designated by any Governmental Authority as "toxic", "hazardous", "extremely hazardous", a "pollutant" or "contaminant" or words of similar import pursuant to Environmental Laws, including petroleum, waste or asbestos.

1.74          "Health Care Laws" has the meaning set forth in Section 0.

1.75          "HSR" means the Hart Scott Rodino Antitrust Improvements Act of 1976, as amended.

1.76          "Indemnified Party" has the meaning set forth in Section 11.4.

1.77          "Indemnifying Party" has the meaning set forth in Section 11.4.

1.78          "Industry‑Wide Plan" means any scheme, plan, fund or arrangement, which provides Retirement Benefits to or in respect of Automatic Transfer Employees in which employers may participate even if they are not within the same corporate group as the other participating employers.

1.79          "Infrastructure Assets" means all assets and Technology that are used in, or are a part of, the general operation of Seller's (including its Subsidiaries) business and not exclusively related to the Business, including network or telecommunications software and equipment, accounting software, IT systems, desktop computer software, database software, and general software development or control systems, tools or environments and including those assets identified on Schedule 1.79.  Notwithstanding the foregoing, "Infrastructure Assets" exclude those items that are specifically listed in Schedule 1.186 as a Transferred Tangible Asset.

1.80          "Intellectual Property" or "IP" means Technology and Intellectual Property Rights in and to Technology.

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1.81          "Intellectual Property Rights" or "IPR" means all rights associated with any of the following: (a) United States and foreign patents and applications  therefor, and including any patent or application that is a provisional application, reissue, re-examination, renewal, extension or continuation of a patent or patent application ("Patents"); (b) know-how, trade secret rights and all other rights in or to confidential business or technical information ("Trade Secrets"); (c) copyrights, copyright registrations and applications therefor and all other rights corresponding thereto throughout the world ("Copyrights"); (d) trademarks, service marks, logos, trade dress rights and similar designation of origin and rights therein, registrations and applications for registration therefor ("Marks"); (e) industrial design rights and any registrations and applications therefor; (f) URLs, WWW address, and domain names ("Internet Properties") (g) databases and data collections (including knowledge databases, customer lists and customer databases); and (h) any similar, corresponding or equivalent rights to any of the foregoing anywhere in the world.  Intellectual Property Rights specifically excludes contractual rights, including license grants, and the tangible embodiment of any of the foregoing.

1.82          "Interim Financials" has the meaning set forth in Section 5.12.

1.83          "IPR Assignment" has the meaning set forth in Section 3.2(c).

1.84          "Knowledge" means: (a) the knowledge of any of the individuals listed on Schedule 1.84 (a); or (b) the knowledge of any of the individuals on Schedule 1.84(b), provided that prior to the Offer Date the particular individual listed on Schedule 1.84(b) communicated the subject matter of such knowledge in writing to one or more superiors of such individual.

1.85          "Landlord" means a landlord, sublandlord, licensor or other party granting the right to use or occupy real property.

1.86          "Laws" means any applicable laws, statutes, ordinances, regulations, rules, interpretations, or orders of any Governmental Authority anywhere in the world.

1.87          "Lease" means a lease, sublease, license or other agreement permitting the use or occupancy of real property.

1.88          "Liabilities" means any and all debts, liabilities, obligations and duties (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, whether latent or patent, whether determined or undetermined, and whether due or to become due).

1.89          "License-Back Field" means: (a) the field (other than the Licensed Field) covering the types of products (other than the Products) sold by Seller and/or its Subsidiaries as of the date hereof; and (b) the field of aesthetics medicine including breast augmentation and reconstruction, body contouring and facial rejuvenation, with products including, breast implants, mammary prostheses, breast expanders, extremity tissue expanders, liposuction and body contouring products, dermal fillers and other bulking agents, toxins, including botulinum toxins, and derivatives and improvements of the foregoing products together with the Technology related thereto, irrespective of whether such products were sold by Seller and/or its Subsidiaries as the date hereof.

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1.90          "License-Back Other IPR" means the Transferred IPR (other than Transferred Patents, the Transferred Marks, the Transferred Internet Properties and those Transferred Copyrights listed on Schedule 1.174), to the extent used as of or prior to the Closing Date in Seller's business (other than exclusively in the Business) or embodied in a product of Seller (other than exclusively in the Products).

1.91          "License-Back Patents" means any Transferred Patents and any Patent filed by Buyer following the Closing that claims  priority from any Transferred Patents.

1.92          "Licensed Field" means the diagnosis, treatment or management of medical or surgical conditions, disorders or diseases relating to (a) the urinary tract or any part thereof (being from kidney to distal urethra), (b) prostate, (c) anorectal canal, rectum and distal colon, (d) pelvic floor, and (e) male or female reproductive organs and the uterus; provided, however, that the License Field shall not include the Licensed-Back Field or any treatment or use involving a toxin, including botulinum toxins, a dermal filler, or bulking agent. 

1.93          "Licensed Other IPR" means all Intellectual Property Rights (other than Transferred IPR, Patents and Marks) owned or licensable (without the consent of or material payment of any consideration to any third Person) by Seller or its Subsidiaries as of the Closing, that are used in, or reasonably necessary to the operation of, the Business in the Licensed Field as of the Closing. 

1.94          "Licensed Patents" means any Patent owned by Seller as of the Closing Date, which is either (i) a Patent issued as of the Closing Date or (ii) which issues following the Closing Date from a Patent application of Seller filed before the Closing Date, and which Patent would, absent the license granted in Section 4.1(a) hereof, be infringed as of the Closing by the operation of the Business or the Products in the Licensed Field, including the Patents identified on Schedule 1.94; provided, that the Licensed Patents shall not include any Patent directed to a toxin, including botulinum toxins, a dermal filler, a bulking agent or use thereof.

1.95          "Licensor Party" and "Licensee Party" have the respective meanings set forth in Section 4.3(a).

1.96          "Losses" means any and all losses, costs, obligations, Liabilities, settlement payments, awards, judgments, fines, penalties, damages, Expenses, deficiencies or other charges.

1.97          "Manages" (or "Management," as the context requires) means uses, possesses, generates, treats, manufactures, processes, handles, stores, recycles, transports, or disposes of Hazardous Substances.

1.98          "Marks" has the meaning set forth in Section 0.

1.99          "Minneapolis Claim" has the meaning set forth in Section 11.3(d)(i)(1).

1.100      "Minneapolis Environmental Losses" has the meaning set forth in Section 11.3(d)(i).

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1.101      "Minneapolis Property" has the meaning set forth in Section 11.3(d)(i).

1.102      "MML" shall mean Mentor Medical Limited.

1.103      "Most Recent Balance Sheet" has the meaning set forth in Section 5.12.

1.104      "Net Working Capital" has the meaning set forth in Schedule 1.104.

1.105      "Net Working Capital Target" means the Net Working Capital derived from the 2006 Year-End Balance Sheet (as defined in Section 0 of the Disclosure Letter) to be delivered by Seller to Buyer in accordance with Section 0 of the Disclosure Letter.  The Net Working Capital Target will be calculated on a consistent basis with, and in accordance with the principles set forth on, the illustrative Closing Date Net Working Capital Statement (assuming the Closing Date had occurred on December 31, 2005) attached hereto as Exhibit D. 

1.106      "Objection" has the meaning set forth in Section 0.

1.107      "Offer Date" means March 27, 2006.

1.108      "Offer Letter" means that certain binding offer letter dated March 27, 2006 from Buyer to Seller relating to the transactions contemplated hereby.

1.109      "Offered Employee" has the meaning set forth in Section 7.1(a).

1.110      "Operative Agreements" means this Agreement, the Assumption Agreement, the Bills of Sale, the Escrow Agreement, any Conveyance Documents, the IPR Assignment, the Transition Services Agreement and the Real Property Agreements and any other document or agreement to be executed and delivered by either of the Parties at the Closing.

1.111      "Other Business Property Environmental Claim" has the meaning set forth in Section 11.3(d)(ii)(1).

1.112      "Other Business Property" has the meaning set forth in Section 0.

1.113      "Other Business Property Environmental Losses" has the meaning set forth in Section 0.

1.114      "Patents" has the meaning set forth in Section 0.

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1.115      "Permitted Encumbrances" means any or all of the following (a) liens for taxes and other similar governmental charges and assessments which are not yet delinquent or liens for taxes being contested in good faith by any appropriate proceedings for which adequate reserves have been established, (b) liens of landlords and liens of carriers, warehousemen, mechanics and materialmen and other like liens arising in the ordinary course of business for sums not yet due and payable, (c) undetermined or inchoate liens, charges and privileges existing as of the Closing Date and any statutory liens, licenses, charges, adverse claims, security interests or encumbrances of any nature whatsoever existing as of the Closing Date and claimed or held by any Governmental Authority that have not at the time been filed or registered against title to the Transferred Assets or that are related to obligations that are not due or delinquent, (d) licenses or other non‑exclusive rights to any Transferred IPR granted prior to the date of this Agreement by Seller or any Affiliate thereof to any third Person, (e) restrictions on resale of securities imposed by applicable federal, state and foreign securities Laws, (f) security given in the ordinary course of business as of the Closing Date to any public utility, Governmental Authority or other statutory or public authority in connection with the Transferred Assets, (g) Encumbrances imposed on the underlying fee interest in the leased property, (h) with respect to U.S. properties, those Permitted Encumbrances listed on Schedule 0, and with respect to all Real Property all other Encumbrances of record that affect such Real Property and such encroachments or other state of facts which an inspection or survey of any Real Property would disclose and (i) other Encumbrances that do not materially impair the use of the Real Property by Seller in respect of the Business.

1.116      "Person" means any individual, corporation, partnership, limited liability company, trust, unincorporated organization, association, firm, joint venture, joint stock company, Governmental Authority or other entity.

1.117      "Poor Performance" means the failure of a Transferred Employee to substantially perform his or her duties to Buyer, or a Subsidiary of Buyer, after having been provided written notice of such failure and 30 days to cure such failure.

1.118      "Porges" shall mean Porges S.A.S.

1.119      "Porges Asset Sale" shall mean the sale of all IPR (which, for purposes of this Section 1.119, shall be read to exclude clause (g) of the definition of IPR) owned by Porges to Buyer to be effected one day prior to the Closing Date pursuant to Section 8.26 hereof.

1.120      "Potential Contributor" has the meaning set forth in Section 11.9.

1.121      "Pre-Closing Taxes" has the meaning set forth in Section 8.7(a)(i).

1.122      "Pre‑Closing Tax Period" has the meaning set forth in Section 8.7(a)(i).

1.123      "Preliminary Purchase Price" means $456,137,500.

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1.124      "Product Liability Claim" shall mean any civil action or claim for money damages brought by an individual recipient and user of product, or any derivative action or claim for money damages including loss of consortium and survival actions and claims, where such action or claim arises out of an alleged defect in design, manufacture, materials, testing, workmanship, or performance of such product, or any alleged failure to warn, or from any alleged breach of warranty, express or implied, or any alleged noncompliance with any applicable Laws, or any alleged negligence, with respect to such product.  A Product Liability Claim will be deemed to be "Made" on the first date a written notice is received by Seller or Buyer, as the case may be, asserting a Product Liability Claim that includes a claim for money damages other than a claim for reimbursement under an express written warranty for such product.  

1.125      "Products" means any and all products of the Business in the Licensed Field: (a) which are currently manufactured and/or sold or licensed by Seller and/or any of its Subsidiaries, including those identified on Schedule 1.125(a); (b) which are under development by Seller and/or its Subsidiaries, including those identified on Schedule 1.125(b); and (c) which were developed, manufactured, distributed, licensed and/or sold, as applicable, at any time before the Closing Date by or on behalf of Seller and/or its Subsidiaries. 

1.126      "Programs" has the meaning set forth in Section 5.22(a).

1.127      "Purchase Price" means the Preliminary Purchase Price, as adjusted pursuant to Section 0.

1.128      "Purchase Price Allocation" has the meaning set forth in Section 8.8.

1.129      "Real Property" has the meaning set forth in Section 5.15(a).

1.130      "Real Property Agreements" means the Real Property Lease Assignments.  Notwithstanding the foregoing, if the relevant Landlord consent to the assignment of an Assigned Lease has not been received prior to the Closing Date as set forth in Section 8.17(a) below, the Real Property Lease Assignment as to such premises shall not be considered Real Property Agreements for purposes of Section 3.2 and Section 3.3.

1.131      "Real Property Lease Assignments" has the meaning set forth in Section 8.17(a)(i).

1.132      "Recall" has the meaning set forth in Section 5.20(b).

1.133      "Released" (or "Release," as the context requires) means released, spilled, leaked, discharged, disposed of, pumped, poured, emitted, emptied, injected, leached, or dumped Hazardous Substances.

1.134      "Remedial Action" has the meaning set forth in Section 8.5(b).

1.135      "Remediation" has the meaning set forth in Section 5.16(a).

1.136      "Response Action" means any action or activities of "response" as that term is defined in 42 U.S.C. § 9601(25), without regard to any limitation of that term (or terms included therein by reference) to "hazardous substances" as defined under CERCLA.

1.137      "Retirement Benefits" means any pension, lump sum, installment, annuity or similar benefit provided or to be provided on or after retirement (including early retirement), death or disability in respect of an Employee's employment, but excluding benefits provided under an arrangement, the sole purpose of which is to provide benefits on the accidental injury or death of a Transferred Employee.

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1.138      "Returns" has the meaning set forth in Section 5.8(a).

1.139      "Rules" has the meaning set forth in Section 0.

1.140      "Schedules" means the schedules to this Agreement as of the Offer Date, except that Schedule 1.94 (Licensed Patents), Schedule 1.186 (Transferred Tangible Assets) and Schedule 7.1(a) (Employees) may be updated by the Seller prior to the Closing, subject to the consent of Buyer (such consent not to be unreasonably withheld, delayed or conditioned) to the extent contemplated by or otherwise provided for under this Agreement.

1.141      "SEC" means the Securities and Exchange Commission.

1.142      "Securities Act" has the meaning set forth in Section 0.

1.143      "Seller" has the meaning specified in the first paragraph of this Agreement.

1.144      "Seller Benefits Plans" means the Employee Benefits Plans of Seller (or a Subsidiary thereof) under which some or all of the Transferred Employees are eligible to participate immediately prior to the date of this Agreement.

1.145      "Seller Caused Environmental Claim" has the meaning set forth in Section 11.3(d)(iii)(1).

1.146      "Seller Caused Environmental Losses" has the meaning set forth in Section 11.3(d)(iii).

1.147      "Seller Domestic Benefit Plan" has the meaning set forth in Section 5.13(a)(i).

1.148      "Seller Employment Liabilities" has the meaning set forth in Section 7.7.

1.149      "Seller's Environmental Indemnification Obligations" means (i) Seller's obligation to indemnify the Buyer Indemnified Parties for any breach of the representations contained in Section 0 hereof to the extent required in (and subject to the other terms and conditions of) Article 11 hereof; and (ii) Seller's obligation to indemnify the Buyer Indemnified Parties for the Seller's Special Environmental Indemnity in Section 0 hereof to the extent required in (and subject to the other terms and conditions of) Article 11 hereof.

1.150      "Seller Indemnified Parties" has the meaning set forth in Section 11.2.

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1.151      "Seller Material Adverse Effect" means any change, event, state of facts, or effect (each an "Effect") that is materially adverse to the Business; provided, however, that none of the following shall be deemed, either alone or in combination, to constitute a Seller Material Adverse Effect: any Effect resulting from or arising out of (a) the announcement of this Agreement or the pendency of the transactions contemplated hereby, including actions taken in connection with the separation of the Business in furtherance of the transactions contemplated hereby, (b) the performance by a Party of its obligations under this Agreement or as required by applicable Laws or accounting requirements, (c) general economic conditions in any country where the Business is conducted that do not disproportionately and adversely affect the Business in any material respect, (d) general conditions in any industry in which the Business is conducted that do not disproportionately and adversely affect the Business in any material respect, (e) any natural disaster or any acts of terrorism, sabotage, military action or war (whether or not declared) or any escalation or worsening thereof, (f) any Environmental Condition existing on or before the Closing in the soil and/or groundwater on, or migrating on or before the Closing from, all properties owned, leased or occupied at any time by Seller or any of Seller's Subsidiaries in connection with the Business or (g) any Effect for which an adjustment to the Preliminary Purchase Price is required to be made pursuant to Section 2.4.

1.152      "Seller Representatives" means the directors, officers, employees, agents, investment bankers, attorneys, accountants and other advisors to, or representatives of, Seller and/or its Subsidiaries.

1.153      "Seller Retirement Plan" means each scheme, plan, fund or arrangement of Seller, whether written or oral, which provides Retirement Benefits to or, in respect of Automatic Transfer Employees (not including any mandatory state or social security plan or Industry‑Wide Plan in which any member of Seller participates for the benefit or, in respect of Automatic Transfer Employees).

1.154      "Seller's Special Environmental Indemnity" means the indemnity provided by Seller to the Buyer Indemnified Parties set forth in Section 0 hereof to the extent required in (and subject to the other terms and conditions of) Article 11 hereof.

1.155      "Shared Benefit Employees" means those Offered Employees (i) who do not accept an offer of employment made by Buyer pursuant to Section 7.1(a), which offer of employment contemplates a relocation of the Offered Employee's principal office to a location of more than fifty (50) miles from the location of the Offered Employee's principal office prior to such relocation and (ii) whose employment is terminated for any reason, other than for Cause or Poor Performance, which termination occurs on or after the date of the offer and on or before the ninetieth (90th) day after the Closing Date.

1.156      "Straddle Period" has the meaning set forth in Section 8.7(a)(i).

1.157      "Subsidiary" means with respect to a Party, any other corporation, limited liability company, general or limited partnership, unincorporated association or other business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Party, or one or more of the other Subsidiaries of such Party or a combination thereof, or (b) if a limited liability company, partnership, association or other business entity, a majority of the partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by such Party, or one or more Subsidiaries of such Party or a combination thereof.

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1.158      "Subsidiary Consents" has the meaning set forth in Section 5.10(b).

1.159      "Subsidiary Contract" has the meaning set forth in Section 5.10(b).

1.160      "Subsidiary Leases" has the meaning set forth in Section 5.15(a).

1.161      "Subsidiary Real Property" means the real property described on Schedule 1.161 hereof.

1.162       "Tax(es)" means any tax of any kind including United States or other national, state, provincial, regional, local or foreign income, net income, alternative or add on minimum, gross income, gross receipts, profits, windfall profits, property, ad valorem, franchise, sales, value‑added, use, capital, transfer, gains, license, excise, employment, payroll, premium, services, environmental transfer, withholding or minimum tax, or any other tax custom, duty, governmental fee or other like assessment or charge of any kind whatsoever, together with any interest and any penalty, addition to tax or additional amount imposed by any Governmental Authority.

1.163      "Tax Return" means any return, declaration, report, statement or information return or other document required to be filed with respect to any Taxes (including any attached schedules, statements or other documents), including any information return, claim for refund, amended return and declaration of estimated Tax.

1.164      "Technology" means inventions, works of authorship, mask works, models, know-how, and other information, including all designs, design and manufacturing documentation (such as bills of materials, build instructions and test reports), schematics, algorithms, routines, patterns, compilations, programs, methods, techniques, unpatented inventions, manufacturing and production processes and techniques, software, databases, lab notebooks, development and lab equipment, process, prototypes, published and unpublished research regarding products, clinical or otherwise, customer and supplier lists, formulas, pricing and cost information and devices.  Technology shall not include Intellectual Property Rights, including any Intellectual Property Rights in any of the foregoing.

1.165      "Territory" means worldwide.

1.166      "Third Party Licenses" means the Contracts identified on Schedule 1.166.

1.167      "Trade Secrets" has the meaning set forth in Section 0.

1.168      "Transfer" means the sale and transfer of the Transferred Assets from Seller (including the Subsidiaries of Seller) to Buyer (including the Buyer Subsidiaries).

1.169      "Transfer Taxes" means all transfer, documentary, sales, registration, value‑added, use and other Taxes, excluding income Taxes, arising in connection with the consummation of the transactions contemplated hereby.

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1.170      "Transferred Accounts Receivables" means the accounts receivable of Seller included on the Final Net Working Capital Statement.

1.171      "Transferred Assets" means all right, title and interest of Seller and its Subsidiaries (excluding IPR) in and to the Transferred Equity Interests, the Transferred Inventory, the Transferred Tangible Assets, the Transferred Contracts, the Transferred Accounts Receivables, the Assigned Leases, the Subsidiary Leases, the Transferred Employee Records and the Transferred Real Property.

1.172      "Transferred Business" means such portion of the Business that constitutes the Transferred Assets, Transferred IPR and the Assumed Liabilities under this Agreement and the transactions contemplated hereby.

1.173      "Transferred Contracts" means the Contracts listed on Schedule 1.173 and any Subsidiary Contracts.

1.174      "Transferred Copyrights" means (a) the registered Copyrights listed on Schedule 1.174 and (b) the Copyrights owned by Seller in works of authorship that are used exclusively in the Business in the Licensed Field as of the Closing.  Notwithstanding, Buyer shall have full, unlimited ownership of the Transferred Copyrights as of the date of Closing, and shall have no limitation on the use of the Transferred Copyrights whether in the Licensed Field or otherwise.

1.175      "Transferred Employee" means each Employee that either (a) becomes an employee of Buyer (or a Subsidiary thereof) upon the Closing or (b) is an Automatic Transfer Employee; provided, however, the parties acknowledge that if an Employee of Seller does not accept an employment offer from Buyer, such Employee would never become a Transferred Employee for any purposes.

1.176      "Transferred Employee Records" means (with such Transferred Employee's consent where legally required) the employment data, which discloses the terms and conditions under which an Employee is employed immediately prior to the Closing, and copies of all personnel files related thereto.

1.177      "Transferred Equity Interests" means the Equity Interests owned of record or beneficially by Seller and its Subsidiaries in the Transferred Subsidiaries. 

1.178      "Transferred Internet Properties" means the Internet Properties that are exclusively used in the Business as identified on Schedule 1.178.

1.179      "Transferred Inventory" means the raw materials, work in process, and finished goods used or held for use in the Business as of the Closing Date (including any on consignment or in transit, and wherever located).

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1.180      "Transferred IPR" means (a) the Transferred Marks, (b) the Transferred Internet Properties, (c) the Transferred Trade Secrets, (d) the Transferred Copyrights, and (e) the Transferred Patents.

1.181      "Transferred Marks" means the Marks that are listed on Schedule 1.181(a) and all of the goodwill of the Business associated with or appurtenant to such Marks as of the Closing; provided, however, that in no event will such Marks include the term "Mentor", those terms identified on Schedule 1.181(b) or any variations thereof, or any trade marks or trade names incorporating such name or the "Mentor" logo, or any trade marks, logos or designs confusing therewith.

1.182       "Transferred Patents" means (i) the Patents (including applications) identified on Schedule 1.182 (ii) any Patent filed by Seller prior to the Closing that claims priority from a Patent identified on Schedule 1.182 as of the Offer Date  (in which case such Schedule shall be amended to add such Patent), and (iii) any Patent filed by Buyer following the Closing which claims priority from a Patent identified on Schedule 1.182 and which invention is in the Licensed Field and a Transferred Trade Secret.

1.183      "Transferred Real Property" means for non-U.S. Real Property, the Real Property identified on Schedule 1.183(a), and for U.S. Transferred Real Property, the Real Property identified on Schedule 1.183(b).

1.184      "Transferred Subsidiaries" means those direct and indirect Subsidiaries of Seller identified on Schedule 1.184.

1.185      "Transferred Subsidiary Employee" has the meaning set forth in Section 7.1(a).

1.186       "Transferred Tangible Assets" means the fixed and other tangible assets (other than real property and buildings and inventory) owned by Seller or any Seller Subsidiaries, other than Transferred Subsidiaries, listed in Schedule 1.186, including (a) the Transferred Technology, (b) the tangible embodiments of the Transferred Trade Secrets, (c) all personal productivity assets owned by Seller or any Seller Subsidiaries associated with Transferred Employees such as personal data assistants, cellular phones and personal computers, and (d) all notes, correspondence, document files, records, marketing materials, pamphlets and literature exclusively relating to the Business or the Products, in each case of clauses (a), (b), (c) and (d), as the same may be depleted or augmented prior to the Closing Date in the ordinary course of business; provided, however, that in no event will such assets include any Excluded Assets.

1.187      "Transferred Technology" means the Technology (other than Excluded Assets) owned by Seller or any Seller Subsidiaries that is used exclusively in the Business in the Licensed Field as of the Closing and the tangible embodiments of the Transferred Trade Secrets and the Transferred Copyrights.  Notwithstanding, Buyer shall have full, unlimited ownership of the Transferred Copyrights as of the date of Closing, and shall have no limitation on the use of the Transferred Copyrights whether in the Licensed Field or otherwise.

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1.188      "Transferred Trade Secrets" means the Trade Secrets (other than the Excluded Assets) owned by Seller or any Seller Subsidiaries that are exclusively used in the Business in the Licensed Field as of the Closing Date.  Notwithstanding, Buyer shall have full, unlimited ownership of the Transferred Trade Secrets as of the date of Closing, and shall have no limitation on the use of the Transferred Trade Secrets whether in the Licensed Field or otherwise.

1.189      "Transition Services Agreement" means the Transition Services Agreement of even date herewith in the form attached hereto as Exhibit C.

1.190      "Upward Adjustment Amount" has the meaning set forth in Section 2.4(d).

1.191      "UK" means the United Kingdom.

1.192      "UK Competition Authorities" means the UK OFT, the UK Competition Commission and any other Governmental Authority in the United Kingdom responsible for the enforcement of antitrust or merger control Laws.

1.193      "UK OFT" means the UK Office of Fair Trading.

1.194      "UK OFT Undertakings" means the undertakings given to the UK Secretary of State for Trade and Industry under Section 88(2) of the Fair Trading Act 1973 by Coloplast A/S, Coloplast Limited and 4C Health Limited following the report of the UK Competition Commission entitled "Coloplast A/S and SSL International plc: A report on the merger situation" (Cm 5811, May 2003) and announced in a Department of Trade and Industry Press Notice dated 22 July 2003 (P/2003/420), or any variations or amended versions thereof.

1.195      "U.S. Employee" has the meaning set forth in Section 7.1(a).

1.196      "Voluntary Transfer Employee" means each Offered Employee who becomes a Transferred Employee pursuant to the terms of this Agreement.

1.197      "Voting Debt" means bonds, debentures, notes or other indebtedness having the right to vote on any matters on which holders of other Equity Interests may vote. 

1.198      "Warranty Breach" means with respect to a Party, an inaccuracy or breach of a representation or warranty expressly made by such Party in an Operative Agreement.

1.199      "Year‑End Financials" has the meaning set forth in Section 5.12.

1.200      "Years of Service" means, with respect to any Transferred Employee's prior service as an employee of either Seller or a Subsidiary of Seller, fully completed calendar years plus the pro rated time described in the following sentence.  Not fully completed calendar years shall be counted towards Years of Service at the rate of 1/12^th for each full calendar month of service.

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(ii)          For all purposes of and under this agreement, the following capitalized terms shall have the respective meanings ascribed thereto in the section of this Agreement set forth opposite each such capitalized term below:

Capitalized Term	Section
ABISS	8.27
ABISS Agreement	8.27
Anoka Facility	8.24(b)(ii)
Assigned Lease Premises	8.17(a)(ii)
Assumed Taxes	8.7(a)(i)
CERCLA	1.50
Changes	8.7(b)
Environmental Insurance	8.21
Evaluation Material	8.15(a)
FIFO	4.11(d)
Foreign Benefit Plan	5.13(b)(i)
FTC Amount	8.6(b)
Insurance Payment	11.6(a)
Internet Properties	1.81
Made	1.124
MEC	8.24(b)(i)
Mentor CLEAR ADVANTAGE Mark	8.24(c)
Minneapolis Environmental Losses	11.3(d)(i)
Mitigation Payment	11.6(a)
Offered Employees	7.1(a)
Other Business Property	11.3(d)(ii)
Party	Preamble
Patent Covenant	4.8
Preliminary Purchase Price Allocation	8.8
Qualifying Loss	11.3(b)
Residuals	4.4
Retained Subsidiaries	8.28
Retention Payment	7.9
Sarlat Property	11.3(d)(ii)(2)
SMEC	8.24(b)(ii)
Structural Representations	11.1
Third Party Payment	11.6(a)
Threshold	11.3(b)
Transferred Names	8.19(a)
Transition Marks	4.11(e)
Transition Products	4.11(e)
UK SMEC Marks	8.24(b)(viii)(1)
Year‑End Financials	5.12(a)

 

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Article 2

PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES

2.1              Transferred Assets; Transferred IPR

(a)                Upon the terms and subject to the conditions set forth herein, including Section 2.3, Article 9 and Article 10, as of the Closing Date, Seller shall, and/or shall cause its Subsidiaries to, sell, transfer, convey, assign and deliver to Buyer, or if so requested by Buyer, to a Subsidiary of Buyer, free and clear of all Encumbrances, and Buyer shall purchase and accept from Seller and its Subsidiaries, the Transferred Assets.

(b)               Upon the terms and subject to the conditions set forth herein, including Section 2.3, Article 9 and Article 10, as of the Closing Date Seller shall, and/or shall cause its Subsidiaries to, sell, transfer, convey, assign and deliver to Buyer, or if so requested by Buyer, to a Subsidiary of Buyer, free and clear of all Encumbrances, all right, title and interest of Seller and its Subsidiaries in and to the Transferred IPR, including the right to pursue past damages based on third‑party infringement of the Transferred IPR, and also including the goodwill of the Business appurtenant to the Transferred Marks included in the Transferred IPR.

(c)                Buyer hereby waives compliance with the provisions of any applicable Laws which relate to the sale of property in bulk in connection with the transfer of the Transferred Assets to the Buyer.

2.2              Assumed Liabilities

Upon the terms and subject to the conditions hereof, as of the Closing Date, Seller shall, or shall cause its Subsidiaries to, assign and transfer to Buyer, and Buyer shall, or shall cause the Buyer Subsidiaries to, assume and fully perform and discharge, on a timely basis and in accordance with their respective terms, the Assumed Liabilities.  Notwithstanding the foregoing, other than the Assumed Liabilities specifically listed on Schedule 1.6, Buyer assumes no Liabilities of Seller, its Subsidiaries or any of its Affiliates.  Notwithstanding anything to the contrary, nothing shall include or be deemed to include among or within the Transferred Business, Transferred Assets, Transferred IPR, Transferred Internet Properties, any assets, Liabilities, IP, IPR or other property rights, or any Liabilities whatsoever with respect to, the ObTape® brand products, including any components thereof, any instruments or other accessories sold in conjunction with and for use strictly with ObTape®, and Marks, advertising and marketing materials used strictly with ObTape®.

 

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2.3              Conveyances

Promptly following the execution and delivery of this Agreement, each of Buyer and Seller will cooperate in good faith to prepare and execute appropriate Contracts to convey or transfer the Transferred Assets, Transferred IPR and Assumed Liabilities held by Seller or its Subsidiaries to Buyer in connection with the Closing, or if so requested by Buyer, Subsidiaries of Buyer (the "Buyer Subsidiaries").  Each of the Parties will use commercially reasonable efforts to cause such transfers to be effected on the most efficient basis, including minimizing Transfer Taxes.  Such transfers shall be on terms (including conditions to Closing, representations and warranties, covenants and indemnification obligations) consistent with this Agreement, including the Purchase Price Allocation, except and only to the extent of modifications required to provide for the intent of this Agreement under applicable Laws (and in such case the minimal modifications required to do so) as may be required by applicable Laws.  Where appropriate, each of Buyer and Seller will cause its Subsidiaries to comply with any applicable Laws prior to entering into the Conveyance Documents.  With respect to any Transferred Assets, Transferred IPR or Assumed Liabilities, one or more bills of sale, assignment and assumption agreement, or similar conveyance documents as may be required under the Laws of the applicable jurisdiction to validly convey, assign and transfer such Transferred Assets, Transferred IPR or Assumed Liabilities (the "Conveyance Documents") may be used by Buyer or Seller in place of the Bills of Sale or the Assumption Agreement, as applicable.  The Parties agree that the Conveyance Documents are not intended to expand or limit the rights and obligations of Seller and Buyer beyond those provided for in this Agreement, and that the Conveyance Documents shall not provide for any additional rights or obligations of the Parties or their respective Subsidiaries that are not provided for in this Agreement or the other Operative Agreements (it being understood that for purposes of this sentence only, Operative Agreements shall not include the Conveyance Documents).  In the event of any conflict between the terms of the Conveyance Documents and this Agreement, the Parties agree and acknowledge that the terms of this Agreement shall control and that, if necessary, the Parties shall deliver such additional instruments as may be necessary to accomplish the foregoing.

2.4              Net Working Capital Adjustment

(a)                Within 60 days after the Closing Date, Buyer will prepare (i) a balance sheet as of the Closing Date, (the "Closing Date Balance Sheet"), which Closing Date Balance Sheet shall be prepared in accordance with GAAP on a consistent basis with the Year-End Financials, and (ii) a statement of Net Working Capital as of the Closing Date (the "Closing Date Net Working Capital Statement", and together with the Closing Date Balance Sheet, the "Closing Statements"), which Closing Date Net Working Capital Statement shall be derived from the Closing Date Balance Sheet.  Seller will assist and cooperate with Buyer in the preparation of the Closing Statements, including by providing Buyer with reasonable access to any relevant personnel, books and records related to the Transferred Assets, the Transferred IPR and the Assumed Liabilities and historical financial data that are in Seller's possession.  A spreadsheet illustrating the Closing Date Balance Sheet and the Closing Date Net Working Capital Statement (assuming in each case that the Closing Date had occurred on December 31, 2005) is attached as Exhibit D hereto for illustrative purposes.

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(b)               Following the delivery by Buyer to Seller of the Closing Statements, Seller shall have a period of 30 days in which to review the Closing Statements.  Seller and its accountants shall be provided with reasonable access to the Transferred Assets and the Transferred IPR, the work papers of Buyer and its accountants and to the books and records relating to the Transferred Assets, the Transferred IPR and the Assumed Liabilities in connection with such review.  In the event that Seller determines that the Closing Statements have not been prepared on a basis consistent with the requirements of Section 2.4(a), Seller shall, on or before the last day of such 30‑day period, inform Buyer in writing of such determination (the "Objection"), setting forth in reasonable detail a specific description of the basis of the Objection, the adjustments to the Closing Statements which Seller believes should be made, and Seller shall be deemed to have accepted any items not specifically disputed in the Objection.  Failure to so notify Buyer shall constitute acceptance and approval of Buyer's preparation of the Closing Statements.

(c)                Buyer shall then have 30 days following the date it receives the Objection to review and respond to the Objection, during which period Buyer and Seller shall negotiate in good faith to resolve the Objection.  If Buyer and Seller are unable to resolve all of their disagreements with respect to the determination of the foregoing items by the 30th day following the date on which Buyer receives the Objection, after having used their good faith efforts to reach a resolution, they shall refer their remaining differences to KPMG LLP (or, if KPMG refuses to act in such capacity, such other nationally recognized accounting firm as the Parties shall reasonably agree) (the "CPA Firm"), who shall, acting as experts in accounting and not as arbitrators, determine on a basis consistent with the requirements of Section 2.4(a), whether and to what extent, if any, the Closing Statements require adjustment.  Buyer and Seller shall request the CPA Firm to use all reasonable efforts to render its determination within 45 days following submission of such matters to the CPA Firm.  The CPA Firm's determination shall be final, conclusive and binding upon Buyer and Seller, and nonappealable to any Person, court or forum absent manifest error or manifest bias.  Buyer and Seller shall promptly make reasonably available to the CPA Firm access to the Transferred Assets, all relevant books and records, any work papers (including those of the Parties' respective accountants, to the extent applicable) and supporting documentation relating to the Closing Statements and all other items reasonably requested by the CPA Firm.  The "Final Balance Sheet" and the "Final Net Working Capital Statement" shall mean, respectively, the Closing Date Balance Sheet and the Closing Date Net Working Capital Statement, as the case may be, (i) as submitted by Buyer pursuant to Section 2.4(a), in the event that (1) no Objection is delivered to Buyer during the initial 30‑day period specified above or (2) Buyer and Seller so agree, (ii) as adjusted in accordance with the Objection, in the event that (A) Buyer does not respond to the Objection during the 30‑day period specified above following receipt by Buyer of the Objection or (B) Buyer and Seller so agree, (iii) as adjusted in accordance with the agreement of Buyer and Seller, if the Parties so agree during the 30‑day period following receipt by Buyer of the Objection, or (iv) as adjusted by the CPA Firm, if it has been submitted to the CPA Firm for review, together with any other modifications to the Closing Statements agreed upon by the Parties.  All fees and expenses of the CPA Firm shall be shared equally by Buyer and Seller.

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(d)               If the Net Working Capital Target is greater than the Net Working Capital as reflected on the Final Net Working Capital Statement (the amount of such excess, the "Downward Adjustment Amount"), then Seller shall pay within ten (10) days to Buyer cash equal to the amount of the Downward Adjustment Amount.  If the Net Working Capital as reflected on the Final Net Working Capital Statement is greater than the Net Working Capital Target (the amount of such excess, the "Upward Adjustment Amount"), then Buyer shall pay within ten (10) days to Seller cash equal to the amount of the Upward Adjustment Amount.  Any payment pursuant to this Section 0 will be treated by the Parties as an adjustment to the Purchase Price.

2.5              No Withholding

Buyer shall make all payments required to be made to Seller hereunder free and clear of and without reduction for any withholding taxes which shall be the sole responsibility of Buyer.

Article 3

CLOSING

3.1              The Closing

The transactions contemplated by this Agreement shall be consummated (the "Closing") at the offices of Wilson Sonsini Goodrich & Rosati, Professional Corporation, at 650 Page Mill Road, Palo Alto, California, no later than two Business Days after all of the conditions set forth in Article 9 and Article 10 shall have been satisfied or waived (other than those conditions that by their terms are not capable of being satisfied or waived until the Closing), or such other place, time and date as the Parties shall agree in writing.  The time and date on which the Closing is actually held is sometimes referred to herein as the "Closing Date."

3.2              Deliveries by Seller

At the Closing, Seller will deliver or cause to be delivered to Buyer (unless previously delivered) the following:

(a)                duly executed share certificates or evidence of membership interests (as applicable), stock powers in blank or membership interest powers in blank (as applicable) in respect of each of the Transferred Equity Interests;

(b)               duly executed counterparts to the Bills of Sale;

(c)                duly executed counterparts of the assignments of the Transferred IPR in substantially the forms as set forth in Exhibit E-1 and Exhibit E-2 (collectively, the "IPR Assignment");

(d)               limited or special warranty deeds transferring the Transferred Real Property to Buyer or its Subsidiaries, subject to any and all Permitted Encumbrances;

(e)                duly executed counterparts of the Real Property Agreements;

(f)                 the certificate referred to in Section 9.5;

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(g)                the applicable Conveyance Documents with respect to each of the jurisdictions set forth in Schedule 0;

(h)                certificates satisfying the requirements of Treasury Regulation § 1.1445-2 that exempt Buyer and the Buyer Subsidiaries from any requirement to withhold Taxes under Code § 1445;

(i)                  a duly executed counterpart of the Escrow Agreement;

(j)                 all Schedules and other documents, instruments, declarations, affidavits and writings as may be necessary to assign, convey, transfer and deliver to Buyer good and valid title to the Transferred Assets and Transferred IPR, free of Encumbrances, or as required to be delivered by Seller (or a Subsidiary thereof) at or prior to the Closing pursuant to the Operative Agreements; provided, however, that Buyer and Seller shall each file or record or cause to be filed and recorded such documents, instruments, declarations, affidavits or other writings as may be necessary in accordance with applicable Laws; provided, further, that the responsibility for the payment of all fees for applicable recordation and filings of documents, instruments, declarations, deeds, affidavits or other writings necessary to effect any applicable assignments or transfers under this Agreement and for recording any such assignments, including assignments with respect to the Transferred Real Property and the Transferred IPR, shall be split equally between Buyer and Seller;

(k)               all documents and instruments necessary to effect filings with any Governmental Authority which are required to properly register the Products and relevant establishments in the Buyer's name effective as of the Closing Date (for example, FDA and its overseas counterparts' products and establishment licenses and environmental permits, etc.);

(l)                  the advice of the Workers' Council of Porges;

(m)              evidence of release of the Encumbrances against the Transferred Assets identified on Schedule 3.2(m);

(n)                all other documents, instruments and writings required to be delivered by Seller (or a Subsidiary thereof), at or prior to the Closing pursuant to the Operative Agreements.

3.3              Deliveries by Buyer

(a)                At the Closing, Buyer will deliver or cause to be delivered to Seller (unless previously delivered) the following:

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(i)            an amount equal to  the Preliminary Purchase Price less the Escrow Amount, which shall be paid by wire transfer of immediately available funds to an account designated by Seller; provided, however, that, if applicable, an appropriate portion of the Preliminary Purchase Price shall be paid in accordance with the terms of the Conveyance Documents (as determined by Seller in its reasonable judgment), with the remainder paid to Seller;

(ii)            a duly executed counterpart of the Assumption Agreement;

(iii)            a duly executed counterpart of the Escrow Agreement;

(iv)            duly executed counterparts to the applicable Conveyance Documents with respect to each of the jurisdictions set forth in Schedule 0;

(v)            the certificates referred to in Section 10.5;

(vi)            duly executed counterparts of the Real Property Agreements; and

(vii)            all other documents, instruments and writings required to be delivered by Buyer (or a Subsidiary thereof) at or prior to the Closing pursuant to the Operative Agreements.

(b)               At the Closing, Buyer will deliver or cause to be delivered to the Escrow Agent the Escrow Amount in accordance with the terms of the Escrow Agreement.

Article 4

INTELLECTUAL PROPERTY LICENSES

4.1              Licensed IPR

Subject to the terms and conditions of this Agreement, effective as of the Closing, Seller hereby does grant, and shall  grant and cause its Subsidiaries to grant, to Buyer and its Subsidiaries, a worldwide, perpetual, irrevocable, non‑terminable, fully paid‑up, non‑exclusive, right and license:

(a)                under all of Seller's rights in the Licensed Patents, to make, have made, use, sell, offer for sale, export and import products in the Licensed Field, and to practice any claimed method within such Licensed Patents in the Licensed Field. The Licensed Patents shall not be sublicensable by Buyer except in the ordinary course of business and only in connection with general license of all or substantially all of the Patents owned by Buyer in the Licensed Field to a third Person; and

(b)               under all of Seller's rights in the Licensed Other IPR, to copy, use, perform, display, distribute, otherwise transfer products and services, and otherwise fully exploit (including by the granting of sublicenses) the Licensed Other IPR and conduct the business of Buyer following the Closing, subject to any restrictions on Buyer with respect to the Trade Secrets of Seller set forth in Section 4.6.

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4.2              License‑Back Patents

Subject to the terms and conditions of this Agreement, effective as of the Closing, Buyer and its Subsidiaries shall and do hereby grant to Seller and its Subsidiaries, and Seller and its Subsidiaries retain, a worldwide, perpetual, irrevocable, non‑terminable, fully paid‑up, non‑exclusive, right and license under all of Buyer's rights in the License‑Back Patents, to make, have made, use, sell, offer for sale, and import any product, and to practice any claimed method within the License‑Back Patents in the License-Back Field.  The License-Back Patents shall not be sublicensable by Seller except in the ordinary course of business and only in connection with general license of all or substantially all of the Patents in the License-Back Field owned by Seller to a third Person.

4.3              Limitations

(a)                Existing Licenses.  All licenses granted by a Party ("Licensor Party") to the other Party or its Subsidiaries, as applicable ("Licensee Party") under this Article 4 are subject to any and all Contracts between the Licensor Party and any third Person entered into prior to the date hereof.

(b)               Maintenance of Patents.  Where a Licensor Party no longer wishes to prosecute or maintain a Licensed Patent or License-Back Patent in force that could be so reasonably prosecuted or maintained in force, it shall offer assignment of the said application or Patent to the Licensee Party at no cost but shall retain a perpetual, irrevocable, non-terminable, royalty free, sublicensable, license to such transferred Patent.

4.4              License-Back Other IPR

Subject to Section 8.16, Buyer and its Subsidiaries shall and do hereby grant to Seller and its Subsidiaries under all rights in the License-Back Other IPR transferred to Buyer hereunder, and Seller and its Subsidiaries retain thereunder, a non-exclusive, worldwide, non-terminable, irrevocable, perpetual, assignable, sublicensable license to use, copy, distribute, otherwise transfer, create derivative works from, display, and perform the Licensed-Back Other IPR (and associated Technology) in all fields; provided, that (i) Seller agrees that it will not knowingly and specifically assign or sublicense such Licensed-Back Other IPR to a third party on a stand-alone basis in the Licensed Field and that the foregoing licenses shall be subject to Section 4.6 with respect to any Trade Secrets included in the License-Back Other IPR; (ii) the forgoing license to the Transferred Trade Secrets included in the Licensed Back Other IPR is limited in the Licensed Field to a license to Residuals only; and (iii) the foregoing license to the Transferred Copyrights included in the Licensed Back Other IPR excludes the use of the tangible embodiments of any such Copyrights in the Licensed Field.  "Residuals" means Trade Secret information retained in the unaided memory of employees that have been exposed to such Trade Secret information.

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4.5              Reservation of Rights

Each of the Licensor Parties hereby reserves all rights not expressly granted hereunder.  No implied licenses are granted by Seller with respect to any of the Transferred Assets or pursuant to any term of this Agreement.

4.6              Trade Secret Protection and Use

Notwithstanding the retention of ownership of any Trade Secrets by Seller (and the license granted thereto to Buyer), or transfer of ownership of Trade Secrets to Buyer (with a license retained thereto by Seller) hereunder, each Party agrees (i) nothing set forth herein shall limit either Party's rights to enforce its rights with respect to the any misappropriation following the Closing by third parties of such Trade Secrets or to protect the confidentiality of such Trade Secrets regardless of whether such Trade Secrets are licensed to, or owned by such Party, and (ii) each Party shall treat the Trade Secrets of the other with at least the same degree of care, as its does its own like Trade Secrets, but in no event with less than reasonable care; provided that each Party may use and disclose the Trade Secrets of the other within the scope of the licensed granted hereunder.

4.7              Transfer

The Licensee Party may transfer or assign, in whole or in part, the licenses granted to it hereunder in connection with a Change of Control of the Licensee Party or the sale of substantially all of the assets of a business of the Licensee Party to which the license to be transferred or assigned relates.

4.8              Products Outside of Licensed Field and License-Back Field

In the event that Seller and/or its Subsidiaries shall make, have made, use, sell, offer for sale, or import a product outside of the License-Back Field that, absent a license, infringes or would infringe any of the Transferred Patents, Seller shall so notify Buyer, and thereafter, Buyer shall license to Seller such Transferred Patents for use in such field of use (but in no event within the Licensed Field) upon commercially reasonable terms, which such terms shall be negotiated in good faith by Buyer and Seller (the foregoing, the "Patent Covenant").  If Seller infringes any Transferred Patents outside the License-Back Field and does not seek a license to such Patents in accordance with the foregoing Patent Covenant, Buyer's sole and exclusive remedy shall be to bring an action seeking a reasonable royalty for a license to such Patents and for past royalty payments that would have been due; provided, however, Buyer (or any successor to the Transferred Patents) shall not have the right to seek or obtain an injunction against Seller's infringement of such Patents and if Buyer is the prevailing party in such action, Buyer shall be entitled to payment of Buyer's legal fees and expenses by Seller.  Buyer agrees that in the event of an assignment or transfer of any of the Transferred Patents, Buyer (and any subsequent transferee) shall obtain the agreement of the transferee or successor to such Transferred Patents, for the benefit of Buyer and its successors, to the Patent Covenant.  In the event that Buyer (or any subsequent transferee of the Transferred Patents) fails to obtain agreement to such Patent Covenant, the Seller shall be deemed to have, effective as of the date hereof, a non-exclusive, royalty free, perpetual worldwide license to such Patents in all fields other than the Licensed Field.

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4.9              Bulking Agent and/or Toxin

In the event that Seller shall seek to first commercialize a dermal filler or other bulking agent or toxin (including a botulinum toxin), as the case may be, in the Licensed Field after the Closing Date, then Seller shall provide Buyer the reasonable opportunity to discuss in good faith a mutually beneficial arrangement for the commercialization of such dermal filler or other bulking agent or toxin, as the case may be, in the Licensed Field; in no event such opportunity to be later than thirty (30) days prior to Seller entering into an agreement, if any, for such first commercialization with a third party.  Seller's obligations under this Section 0 shall terminate on the tenth (10^th) anniversary of the Closing Date.

4.10          Exclusive Patent

If Schedule 1.182 omits any Patents owned by Seller as of the Closing Date that as of the Closing Date claim an invention that is exclusive to the Licensed Field, Buyer shall, as its sole and exclusive remedy for such omission, be granted and shall have effective as of the Closing Date, a perpetual, worldwide, royalty free, paid-up license in the Licensed Field to such Patent with the right to bring an action for the infringement of such Patent or Patents in the Licensed Field.  Such license shall be exclusive in the Licensed Field as of the date the determination is made that such Patent was omitted from Schedule 1.182.

4.11          License to Transition Marks

(a)                Seller hereby grants to Buyer, effective as of the Closing Date, a worldwide, non-exclusive, non-transferable license under the Transition Marks (as defined below) to use such Transition Marks in connection with the marketing, packaging, sale and promotion of Transition Products (as defined below) in substantially the same manner that such Transition Marks were used by Seller prior to the Closing.  All goodwill associated with the use of such Transition Marks shall inure to the benefit of Seller.

(b)               Buyer shall maintain the quality of the goods with which such Transition Marks are used at least at the same level maintained by Seller prior to the Closing.  Without limiting the foregoing, Buyer shall not (i) use the Transition Marks in a manner that detracts from the goodwill associated with such Transition Marks or in a manner contrary to the reasonable instructions of Seller, (ii) co-brand the Products with any other Marks without the prior written consent of Seller, or (iii) sell any Transition Product beyond its shelf life or in any other improper manner.  Buyer shall not make any warranty, express or implied, to any third party on behalf of Seller with respect to the Transition Products and except as may be otherwise provided under this Agreement shall be solely responsible for all Transition Products sold by it.

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(c)                Notwithstanding the license set forth in Section 4.1(a), Buyer will use reasonable commercial efforts, subject to regulatory requirements, to cease using the Transition Marks as promptly as practicable following the Closing, and replace such Marks with new Marks owned by Buyer.  Without limiting the generality of the foregoing, in no event may Buyer market, package, sell or promote any product under or bearing a Transition Mark that shall have been manufactured by or for Buyer which manufacture shall have occurred after the last day of the 18th month following the Closing Date.

(d)               Buyer will sell Transition Products in inventory on a first-in-first-out (FIFO) basis.  Buyer will not increase inventory levels of Transition Products beyond levels consistent with historic inventory levels of such Transition Products.

(e)                For the purposes of this Section 4.11, (A) "Transition Products" means (i) all Products in Seller's inventory as of the Closing Date and (ii) all such Products manufactured by or for Buyer in accordance herewith and sold by Buyer under a Transition Mark; and (B) "Transition Marks" means all Marks used by Seller prior to the Closing Date in connection with the marketing, sale, promotion and packaging of the Transition Products.

Article 5

REPRESENTATIONS AND WARRANTIES OF SELLER

Subject to the Schedules and the disclosures and exceptions set forth in the Disclosure Letter delivered by Seller to Buyer on the date hereof (the "Disclosure Letter") (which disclosures and exceptions will reference the appropriate section of this Article 5 to which they relate and each of which disclosures and exceptions shall be deemed to be incorporated by reference into the representations and warranties; provided, that any information disclosed in the Disclosure Letter shall be deemed disclosed and incorporated in any other section, subsection, clause and paragraph hereof where it is reasonably apparent that such disclosure is applicable to such other section, subsection, clause or paragraph) Seller hereby makes the following representations and warranties to Buyer as of the Offer Date:

5.1              Organization and Authority

(a)                Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Minnesota.  Seller has the requisite corporate power and authority to execute and deliver this Agreement and each of the Operative Agreements to which it is a party and to perform its obligations hereunder and thereunder.  Seller is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where such qualification is necessary, except for those jurisdictions where failure to be so qualified would not, individually or in the aggregate, have a material adverse effect on Seller or prevent the performance by Seller of its obligations under this Agreement or the other Operative Agreements to which it is a party.

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(b)               Each of the Transferred Subsidiaries is duly organized, validly existing and in good standing (to the extent such jurisdiction recognizes the concept or similar concept) under the laws of the jurisdiction in which it was formed.  Each of the Transferred Subsidiaries has the requisite corporate power and authority to execute and deliver each of the Operative Agreements (if applicable) to which it is a party and to perform its obligations thereunder.  Each of the Transferred Subsidiaries is duly qualified to do business in and is in good standing in each jurisdiction where such qualification is necessary, except for those jurisdictions where failure to be so qualified or in good standing would not, individually or in the aggregate, be reasonably likely to have a material adverse effect on Seller or prevent the performance by Seller of its obligations under this Agreement or the other Operative Agreements to which it is a party.

(c)                This Agreement is as of the date hereof, and each of the other Operative Agreements to which Seller or a Subsidiary is a party will be, upon their execution and delivery, duly and validly authorized, executed and delivered by Seller or the applicable Subsidiary and this Agreement constitutes, and each of the other Operative Agreements to which Seller or a Subsidiary is a party will constitute, the valid and binding agreement of Seller or the applicable Subsidiary, enforceable against Seller or the applicable Subsidiary in accordance with its respective terms, subject to bankruptcy and debtor creditor laws of general application, rules of equity and rules concerning specific performance (collectively, the "Enforceability Exceptions").  No other actions or proceedings on the part of Seller are necessary to authorize Seller's execution or performance of this Agreement or any of the other Operative Agreements to which it is a party or the transactions contemplated hereby or thereby.

5.2              Transferred Subsidiaries; Capitalization

(a)                Except for the Transferred Equity Interests, Seller does not own or hold, directly or indirectly, any Equity Interest of any kind in any Person that owns assets or properties or conducts operations used or held for use in the Business.  All of the Transferred Equity Interests have been duly authorized and validly issued and are fully paid and non-assessable, to the extent such terms are applicable to such Transferred Equity Interests, with no personal liability attaching to ownership thereof, and such Transferred Equity Interests are owned by Seller, in each case free and clear of any Encumbrances.  Upon consummation of the transactions contemplated hereby, Buyer and/or a Subsidiary of Buyer will acquire good and valid title to the Transferred Equity Interests free and clear of all Encumbrances, other than Encumbrances placed upon such Transferred Equity Interests by Buyer or its Subsidiaries or generally applicable to the assets of Buyer and/or its Subsidiaries. Except for this Agreement, the Transferred Equity Interests and as described in Section 5.2(a) of the Disclosure Letter, there are no outstanding Equity Interests in the Transferred Subsidiaries.  There are no Contracts or other arrangements by which the Transferred Subsidiaries are, may be or become bound to issue additional Equity Interests in the Transferred Subsidiaries.

(b)               Neither Seller nor any of its Subsidiaries is subject to any obligation or requirement to provide funds to or make any investment (whether in the form of a loan, capital contribution or otherwise) in any of the Transferred Subsidiaries.

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(c)                The jurisdiction of organization and authorized Equity Interests of each Transferred Subsidiary is set forth in Section 0 of the Disclosure Letter.  There are no outstanding obligations of the Transferred Subsidiaries to repurchase, redeem or otherwise acquire any shares of capital stock or membership interests of the Transferred Subsidiaries or pursuant to which any Transferred Subsidiary is required to register any Equity Interests under the Securities Act of 1933, as amended (the "Securities Act") or under any other Laws.  None of the Transferred Subsidiaries has any outstanding Voting Debt.

5.3              No Violation

The execution and delivery by Seller of this Agreement, and by Seller and its Subsidiaries under each of the other Operative Agreements to which any of them is a party, does not, and the performance by Seller of its obligations hereunder, and by Seller and its Subsidiaries under each of the other Operative Agreements to which any of them is a party, will not: (a) conflict with, or result in a breach of, any of the provisions of any of their respective charter documents, bylaws or similar organizational documents; (b) materially breach, violate or contravene any applicable Laws; (c) create any right of termination or acceleration or Encumbrance that would prevent Seller or any of its Subsidiaries from performing its obligations under this Agreement or any other Operative Agreement to which any of them is a party; (d) assuming that the Consensual Transfers identified in Section 0 of the Disclosure Letter are obtained, conflict with, or result in a breach of or default under, any Transferred Contract in any material respect; or (e) conflict with, or result in a breach of or default under, any material Subsidiary Contract in any material respect.

5.4              Compliance with Laws; Business Permits

No Governmental Actions on the part of Seller or any of its Affiliates or Subsidiaries are required in connection with the execution or delivery by Seller of this Agreement or by Seller or any of its Subsidiaries under any of the Operative Agreements to which it is a party or the consummation by Seller of the transactions contemplated hereby or the consummation by Seller or any of its Subsidiaries of the transactions contemplated thereby, other than pursuant to HSR and such other Governmental Actions identified on Section 5.4 of the Disclosure Letter.  For the avoidance of doubt, neither Seller nor any of its Subsidiaries hereby make any representations or warranties to Buyer as to the compliance with the UK OFT Undertakings of Buyer, any of its Subsidiaries or other parties to the UK OFT Undertakings.  Seller and the Transferred Subsidiaries, as the case may be, hold, to the extent legally required, all material permits, licenses, variances, clearances, consents, commissions, foreclosures, exemptions, orders, authorizations and approvals from Governmental Authorities that are required for them to conduct the Business in accordance with all applicable Laws (the "Business Permits").  Seller and the Transferred Subsidiaries have conducted and operated, and are conducting and operating, the Business in accordance with the terms of the Business Permits and in compliance with all Laws applicable to the Business, its properties and affairs, including employment and immigration Laws, in all material respects.

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5.5              No Broker

None of Seller or any Subsidiary of Seller, has engaged any Person, other than Citigroup Global Markets Inc. (the fees of which shall be paid by Seller), which is entitled to any fee or commission as a finder or a broker in connection with this Agreement or the transactions contemplated hereby.

5.6              Absence of Changes

Since the date of the Most Recent Balance Sheet and through the Offer Date there has not been:

(a)                any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Seller Material Adverse Effect;

(b)               any creation or other incurrence of any Encumbrance on any Transferred Asset other than Encumbrances created or incurred in the ordinary course of business;

(c)                any Contract entered into by Seller primarily relating to the Business or any Transferred Assets (including the acquisition or disposition of any assets) material to the Business or to the Transferred Assets and Transferred IPR, taken as a whole or exceeding $100,000 per annum, other than Contracts entered into in the ordinary course of business and those contemplated by this Agreement and the other Operative Agreements; or any Contract entered into by Seller resulting in an Encumbrance other than a Permitted Encumbrance with respect to Real Property;

(d)               any receipt of written notice by Seller of any termination by any customer, supplier or other third Person in connection with, and material to, the Business;

(e)                any material damage, destruction or loss to the assets of the Business;

(f)                 any (i) employment, deferred compensation, severance, retirement or other similar Contract entered into with any Transferred Employee (or any amendment to any such existing Contract) other than as required by Law or in the ordinary course of business, (ii) grant of any right to severance or termination pay to any Transferred Employee, other than in the ordinary course of business, (iii) change in compensation or other benefits payable to any Transferred Employee pursuant to any severance or retirement plans or policies thereof, other than in the ordinary course of business, or (iv) other change in the compensation or benefits structure applicable to the Transferred Employees in a manner that adversely affects in a material respect the cost structure of the Business;

(g)                any payment, discharge or satisfaction of any claim, Encumbrance, obligation or Liability of the Business, other than (i) Permitted Encumbrances, (ii) the payment, discharge or satisfaction of claims, Encumbrances, obligations or liabilities reflected or reserved against in the Most Recent Balance Sheet or (iii) in the ordinary course of business;

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(h)                any write down or write up in the value of any Transferred Inventory, or any determination as collectible of any Transferred Accounts Receivable or any part thereof which were previously considered uncollectible, or any write off as uncollectible of any Transferred Accounts Receivable or any part thereof, except in each case for write downs, write ups, and write offs in the ordinary course of business consistent with past practice;

(i)                  except in the ordinary course of business, any disposition of or permission to lapse of any right to the use of any of the Transferred IPR, or application therefor or any disposition of, or to Seller's Knowledge any disclosure of any Transferred Trade Secrets or other confidential information constituting Transferred IPR to Persons not bound by confidentiality obligations;

(j)                 except in the ordinary course of business and except for the capital expenditure commitments described on Section 5.6(j) of the Disclosure Letter, making by the Business of any capital expenditure or commitment in excess of $500,000 for additions to property, plant, equipment, intangible or capital assets or for any other purpose, other than for emergency repairs or replacements;

(k)               any entry related to the Business, into any collective bargaining or labor Contract, or any experience of any organized slowdown, work interruption, strike or work stoppage;

(l)                  sale, transfer or other disposition of any of the Transferred Assets except in the ordinary course of business;

(m)              any grant or incurrence of any obligation for any increase in the compensation of any Transferred Employee (including same pursuant to any bonus, pension, profit sharing, retirement or other plan or commitment) except for raises to Transferred Employees in the ordinary course of business consistent with past practices;

(n)                any change in any method of accounting or accounting principles, practices or policies of Seller with respect to the Financial Statements except as required by a concurrent change in GAAP or the rules and regulations of the Securities and Exchange Commission;

(o)               any Contract, whether in writing or otherwise, to take any of the actions set forth in this Section 5.6 except as otherwise specifically permitted or contemplated by this Agreement or any other Operative Agreement.

5.7              Contracts

As of the Offer Date, neither Seller nor any of the Transferred Subsidiaries is a party to or bound by, nor has Seller or any Transferred Subsidiary made any commitment with respect to any of the following with respect to the Business:

(a)                any Contract relating to the pending acquisition or disposition of any business or product line (whether by merger, sale of stock, sale of assets or otherwise);

(b)               any Contract which creates any Encumbrance on any Transferred Asset or Transferred IPR;

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(c)                any Contract concerning the establishment or operation by the Business of a partnership, joint venture or limited liability company;

(d)               any Contract relating to the Business concerning or containing restrictions on business activities, including noncompetition or nonsolicitation (other than noncompetition or nonsolicitation agreements entered into with Employees in the ordinary course of business);

(e)                any employment Contract (other than "at will" employment Contracts and Contracts arising as a matter of applicable Law) with any Transferred Employee or consulting Contract with any Person (other than consulting Contracts terminable by Seller or its Subsidiaries without cause or penalty and with no more than 30 days advance notice) providing for fixed annual cash compensation in excess of $50,000 or any employee retention, stay or bonus Contracts;

(f)                 any collective bargaining, workers' council or similar Contract relating to the Business entered into with any trade union, workers' council or other group of employee representatives;

(g)                any Contract (excluding Assigned Leases and Subsidiary Leases) under which the consequences of a default or termination would reasonably be expected to have a Seller Material Adverse Effect; or

(h)                any Contract (excluding Assigned Leases and Subsidiary Leases) which contains any provisions requiring Seller or any Transferred Subsidiary to indemnify any other party (other than (i) indemnities against breach of the obligations contained in Contracts which were entered into in the ordinary course of business, including ordinary course, generic director, officer and employee indemnification agreements not relating to specific or particular subjects and (ii) indemnities against IPR infringement contained in non-exclusive licenses entered into in the ordinary course).

5.8              Taxes

(a)                To the extent that failure to do so would materially adversely impact the Transferred Assets or the Buyer's ownership of the Transferred Assets or operation of the Business, Seller and the Transferred Subsidiaries (a) have timely paid all Taxes they are required to pay or have provided adequate accruals on its Financial Statements for all Taxes it is required to pay and (b) have timely filed all required federal, state, local and foreign returns, estimates, information statements and reports (collectively, "Returns") relating to any and all Taxes concerning or attributable to the Transferred Assets or the Business and such Returns are true, correct and complete, prepared in accordance with applicable Laws and have timely filed all other material Tax returns required to be filed by them.

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(b)               Seller and the Transferred Subsidiaries have timely paid or withheld with respect to their Employees and other third parties (and timely paid over any withheld amounts to the appropriate Taxing authority) all federal and state income taxes, Federal Insurance Contribution Act, Federal Unemployment Tax Act and other Taxes required to be withheld or paid.

(c)                There are no Encumbrances with respect to any Taxes upon any of the Transferred Assets, other than with respect to Taxes not yet due and payable.

(d)               Seller does not know of any basis for the assertion of any claim for any liabilities for unpaid Taxes of Seller or the Transferred Subsidiaries for which Buyer would become liable as a result of the transactions contemplated by this Agreement or that would result in any Encumbrance on any of the Transferred Assets.

(e)                To the extent applicable to the Transferred Assets or the Buyer's ownership of the Transferred Assets or operation of the Business, Seller has not been delinquent in the payment of any material Tax, nor is there any Tax deficiency outstanding, assessed or proposed against Seller, nor has Seller executed any outstanding waiver of any statute of limitations on or extension of the period for the assessment or collection of any Tax.

(f)                 To the extent applicable to the Transferred Assets or the Buyer's ownership of the Transferred Assets or operation of the Business, (i) no audit or other examination of any Return of Seller is presently in progress, nor has Seller been notified of any request for such an audit or other examination; (ii) no adjustment relating to any Return filed by Seller has been proposed formally or, to the Knowledge of Seller, informally by any tax authority to Seller or any representative thereof; and (iii) no claim has ever been made by an authority in a jurisdiction where Seller does not file Returns that it is or may be subject to taxation by that jurisdiction. 

5.9              Transferred Tangible Assets

Seller or its Subsidiaries have good and marketable title to the Transferred Tangible Assets, free and clear of any Encumbrances.  To the Knowledge of Seller, such Transferred Tangible Assets are in good operating condition, free of any material defects (except those resulting from normal wear and operation).  The Transferred Tangible Assets will constitute at the Closing, all of the material tangible assets (other than Infrastructure Assets) held by Seller or any of its Subsidiaries and primarily used or held for use in the Business.

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5.10          Transferred Contracts; Subsidiary Contracts

(a)                Each Transferred Contract is a valid and binding agreement of Seller or a Subsidiary of Seller, is in full force and effect and, to the Knowledge of Seller, is enforceable according to its terms, subject to the Enforceability Exceptions.  Each of Seller and its Subsidiaries has performed or is performing all material obligations required to be performed by it under the Transferred Contracts and is not in breach or default in any material respect thereunder and, to the Knowledge of Seller, no other party to any Transferred Contract is in breach or default in any material respect thereunder.  True and complete copies of each Transferred Contract have been made available to Buyer.  Section 0 of the Disclosure Letter sets forth a list of all consents to transfers, assignments and novations required as of the Closing in connection with the assignment of the Transferred Contracts as contemplated by this Agreement (the "Consensual Transfers").  Notwithstanding the foregoing, Seller makes no representation or warranty with respect to the Transferred Contracts regarding infringement or misappropriation of Intellectual Property Rights except those expressly made pursuant to Section 5.11.

(b)               Each Contract (excluding Subsidiary Leases) to which a Transferred Subsidiary is a party (each such Contract, a "Subsidiary Contract"), is a valid and binding agreement of such Transferred Subsidiary and is in full force and effect and, to the Knowledge of Seller, is enforceable according to its terms, subject to the Enforceability Exceptions.  Each Transferred Subsidiary has performed or is performing all material obligations required to be performed by it under the Subsidiary Contracts and is not in breach or default in any material respect thereunder and, to the Knowledge of Seller, no other party to any Subsidiary Contract is in breach or default in any material respect thereunder.  True and complete copies of each material Subsidiary Contract have been made available to Buyer.  Section 5.10(b) of the Disclosure Letter sets forth a list of all consents to transfers and assignments required in respect of the Subsidiary Contracts as of the Closing in connection with the transactions contemplated by this Agreement (the "Subsidiary Consents").

(c)                As of the Offer Date, the Third Party Licenses listed on Schedule 1.166 are all of the licenses between Seller (or a Subsidiary thereof) and a third Person pursuant to which such third Person has licensed software or other IPR (except for Marks) to Seller or a Transferred Subsidiary that is material to, and used by Seller or any of its Subsidiaries in the Business (other than Infrastructure Assets and software licensed under industry typical object code licenses and generally available in the marketplace).  Schedule 1.166 indicates which of such Third Party Licenses that Seller or its Subsidiaries may transfer to Buyer or a Buyer Subsidiary in accordance with the terms of such license and without Seller, or the applicable Transferred Subsidiary, incurring any material Liability to such third Person.

5.11          Intellectual Property

(a)                To the Knowledge of Seller, as of the Offer Date, neither Seller nor any Subsidiary has received written notice within the four-year period preceding the Offer Date of any material claim that the conduct of the Business by Seller or its Subsidiaries infringes, misappropriates or otherwise violates the Intellectual Property Rights of any third Person.

(b)               To the Knowledge of Seller, as of the Offer Date, the conduct of the Business by Seller and its Subsidiaries does not infringe any Patent held by any third Person.

(c)                To the Knowledge of Seller, as of the Offer Date, the conduct of the Business by Seller and its Subsidiaries has not and does not infringe or misappropriate any Copyright, Trade Secret or Mark held by any third Person.

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(d)               The issued Patents identified on Schedule 1.94 (as such schedule may be supplemented prior to the Closing Date) together with the Transferred Patents are the only issued Patents owned or licensable by Seller and its Subsidiaries that, absent a license, would be infringed by Buyer's and its Subsidiaries' conduct of the Business immediately after the Closing Date (assuming the conduct of the Business by Buyer and its Subsidiaries immediately after the Closing is the same as the conduct of the Business by Seller and its Subsidiaries immediately prior to the Closing).

(e)                As of the Offer Date, there have been no written claims within the four-year period preceding the Offer Date against Seller or its Subsidiaries asserting the invalidity, misuse or unenforceability of any Transferred IPR.

(f)                 Seller owns all right, title and interest in and to all of the Transferred IPR and/or has the right and authority to transfer such Transferred IPR to Buyer in accordance with the terms hereof free and clear of any and all Encumbrances but subject to any prior non-exclusive licenses granted by Seller or its Subsidiaries prior to the Closing pursuant to Section 8.2.

(g)                Seller and its Subsidiaries have taken reasonable steps to protect Seller's and its Subsidiaries' rights in Trade Secrets relating to the Business that it wishes to protect, and without limiting the foregoing, Seller and each Transferred Subsidiary have a policy requiring each Employee and contractor materially involved in proprietary aspects of the Business to execute nondisclosure of proprietary information and confidentiality agreements and Seller and each Transferred Subsidiary have implemented such policy.

(h)                There are no Contracts (other than Transferred Contracts), which provide for any future cash payments to Seller or a Subsidiary thereof for the use of the Transferred IPR.

(i)                  Section 5.11(i) of the Disclosure Letter lists (i) all items of Transferred IPR that are subject to a formal registration with the United Stated Patent and Trademark Office, Copyright Office or similar authority anywhere in the world that, to the Knowledge of Seller, will expire or otherwise require action to continue, renew or maintain same within the six (6) month period after the Offer Date and (ii) such information as Seller's intellectual property counsel is able to reasonably provide from a review of standard docket reports as of the Offer Date.

(j)                 There is no currently pending, or to Seller's Knowledge threatened, adverse decisions or claims in which Seller is a named party with respect to any opposition, cancellation, injunction or other claim or restriction concerning the Transferred IPR.

(k)               To Seller's Knowledge, the Transferred IPR is valid and enforceable.

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5.12          Financial Statements and Reports

(a)                Section 0 of the Disclosure Letter sets forth the following with respect to the Business: (i) (A) the audited balance sheet as of March 31, 2005 and the related audited statements of income and cash flows for the 12‑month period ended March 31, 2005 and the related notes of Seller and its Subsidiaries related to the Business and (B) the unaudited balance sheet as of March 31, 2004 and the related unaudited income statement for the 12‑month period ended March 31, 2004 of Seller and its Subsidiaries related to the Business ((A) and (B) together, the "Year‑End Financials"), and (ii) unaudited balance sheet as of December 31, 2005 (the "Most Recent Balance Sheet"), and the related unaudited income statement for the 9‑month period ended December 31 , 2005 of Seller and its Subsidiaries related to the Business (together with the Most Recent Balance Sheet, the "Interim Financials").  The Year‑End Financials and the Interim Financials (collectively, the "Financial Statements") have been prepared in accordance with GAAP, applied in a consistent manner, except that the Interim Financials do not contain the notes required by GAAP.  The Financial Statements present fairly the financial condition, operating results and cash flows of the Business as of the dates and for the periods indicated therein.

(b)               Neither Seller nor any Transferred Subsidiary has any Liability with respect to the Business, except for (i) Liabilities reflected in the Financial Statements, (ii) Liabilities which have arisen since the date of the Most Recent Balance Sheet in the ordinary course of business, (iii) contractual and other Liabilities incurred but which are not required by GAAP to be reflected on a balance sheet and (iv) the Excluded Liabilities.

(c)                Seller and each Transferred Subsidiary maintain accurate books and records reflecting their respective assets and liabilities and maintain proper and adequate internal accounting controls which are designed to provide reasonable assurance that (i) transactions related to the Business are executed with management's authorization, (ii) transactions are recorded as necessary to permit preparation of the financial statements of Seller and its Subsidiaries and to maintain accountability for the assets of the Business, (iii) access to assets of the Business is permitted only in accordance with Seller's management's authorization, (iv) the reporting of assets of the Business is compared with existing assets at regular intervals, and (v) accounts, notes and other receivables and inventory related to the Business were recorded accurately, and proper and adequate procedures are implemented to effect in all material respects the collection thereof on a current and timely basis.

5.13          Benefit Plan Compliance

(a)                Domestic Plans.

(i)            The Employee Benefits Plans currently maintained by, or contributed to by Seller or any ERISA Affiliate for the benefit of Employees on Seller's United States payroll (each a "Seller Domestic Benefit Plan") that are subject to the Laws of the United States are those listed in Section 5.13(a)(i) of the Disclosure Letter, and a copy or summary of each has been furnished or made available to Buyer.

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(ii)            Each Seller Domestic Benefit Plan intended to be qualified under Section 401(a) of the Code, has obtained a favorable determination, notification, advisory and/or opinion letter, as applicable, as to its qualified status from the Internal Revenue Service.  Seller and each ERISA Affiliate and, to the Knowledge of Seller, each of the Seller Domestic Benefit Plans, are in compliance with the provisions of the applicable Laws (if any) under which the Seller Domestic Benefit Plans are maintained, and with the terms of such Seller Domestic Benefit Plans.

(iii)            Except as may be set forth in Section 5.13(a)(iii) of the Disclosure Letter, all contributions to the Seller Domestic Benefit Plans which may have been required to be made in accordance with the terms of any such plan, and, when applicable, the Law of the jurisdiction in which such plan is maintained, have been made.

(iv)            Except as set forth in Section 5.13(a)(iv) of the Disclosure Letter, all reports and returns, including Forms 5500, with respect to any Seller Domestic Benefit Plan required to be filed by Seller with any Governmental Authority or distributed to any Seller Domestic Benefit Plan participant by Seller have been duly filed or distributed.

(v)            Except as set forth in Section 5.13(a)(v) of the Disclosure Letter, there are no pending investigations by any Governmental Authority involving the Seller Domestic Benefit Plans, and there are no claims pending or, to the Knowledge of Seller, threatened against Seller (except for claims for benefits payable in the normal operation of the Seller Domestic Benefit Plans) nor, are there any facts that could give rise to any Liability in the event of such investigation, claim, suit or proceeding.

(vi)            Neither Seller nor any ERISA Affiliate has incurred any Liability under Title IV of ERISA, including any Liability under Sections 4062, 4063 or 4064 of ERISA, or any withdrawal liability, within the meaning of Section 4201 of ERISA or potential withdrawal liability arising from a transaction described in Section 4204 of ERISA.

(vii)            Seller and each ERISA Affiliate have complied with the notice and continuation coverage requirements of Section 4980B of the Code and the regulations thereunder with respect to each Seller Domestic Benefit Plan that is, or was during any taxable year of Seller or any ERISA Affiliate for which the statute of limitations on the assessment of federal income Taxes remains open, by consent or otherwise, a group health plan within the meaning of Section 5000(b)(1) of the Code except for such noncompliance as would not reasonably be expected to subject Buyer, or any of the Transferred Assets, to any material liability.

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(b)               Foreign Plans.

(i)            The only Employee Benefits Plans maintained by, or contributed to by Seller, any Transferred Subsidiary or any ERISA Affiliate for the benefit of Employees or former Employees that are subject to the Laws of jurisdictions other than the United States, and that it is anticipated by Seller that Buyer will be required to assume or continue either by operation of Law or by the terms of this Agreement, are those listed in Section 0 of the Disclosure Letter (each a "Foreign Benefit Plan").  A copy or summary of each Foreign Benefit Plan, and, where applicable, a copy of the most recent actuarial report has been furnished or made available to Buyer.

(ii)            Seller, each Transferred Subsidiary and each ERISA Affiliate and, to the Knowledge of Seller, each of the Foreign Benefit Plans, are in compliance with the provisions of the applicable Laws of each jurisdiction in which any of the Foreign Benefit Plans are maintained, to the extent such Laws are applicable to the Foreign Benefit Plans and with the terms of such Foreign Benefit Plans.

(iii)            Except as may be set forth in Section 5.13(b)(iii) of the Disclosure Letter, all contributions to or accruals for the Foreign Benefit Plans which may have been required to be made in accordance with the terms of any such plan, and, when applicable, the Law of the jurisdiction in which such plan is maintained, have been made.

(iv)            Except as set forth in Section 5.13(b)(iv) of the Disclosure Letter, all reports and returns with respect to any Foreign Benefit Plan required to be filed by Seller with any Governmental Authority or distributed to any Foreign Benefit Plan participant by Seller have been duly filed or distributed.

(v)            Except as set forth in Section 5.13(b)(v) of the Disclosure Letter, there are no pending investigations by any Governmental Authority involving the Foreign Benefit Plans, and there are no claims pending or, to the Knowledge of Seller, threatened against Seller (except for claims for benefits payable in the normal operation of the Foreign Benefit Plans), nor, are there any facts that could give rise to any Liability in the event of such investigation claim, suit or proceeding.

5.14          Labor Matters

(a)                Section 5.14(a) of the Disclosure Letter contains a list of any collective bargaining, workers' council or similar agreement to which Seller or any Transferred Subsidiary is a party, or to which Seller or any Transferred Subsidiary is subject as a matter of applicable Law, with respect to or relating to the Business.  Neither Seller nor any Transferred Subsidiary is (a) subject to a legal duty to bargain (exclusive of any notification and consultation obligations) with any trade union or workers' council on behalf of the Employees or (b) to the Knowledge of Seller, the object of any attempt to organize the Employees for collective bargaining purposes or presently operating under an expired collective bargaining agreement.  As of the Offer Date and within the four year period preceding the Offer Date, neither Seller nor any Transferred Subsidiary in respect of the Transferred Business is or has been a party to or subject to any pending strike, work stoppage, organizing attempt, picketing, boycott or similar activity. 

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(b)               Section 0 of the Disclosure Letter contains a list (with names omitted where required by applicable local law) of all Employees or independent contractors employed or engaged by Seller and the Transferred Subsidiaries in the Transferred Business and whose base annual salary exceeds $100,000 per year or who are employed pursuant to any employment Contract (other than "at will" employment Contracts and Contracts arising as a matter of applicable Law), along with the position and the annual rate of compensation of each such person.  Each current or past Employee has entered into Seller's or the Transferred Subsidiaries' standard confidential information and invention assignment agreement with Seller or a Transferred Subsidiary, as the case may be.  Section 0 of the Disclosure Letter contains a list of all Employees employed in the United States who are not citizens of the United States.

(c)                On or before the date of this Agreement, (i) the formalities of information and consultation of the Workers' Council of Porgès have been duly fulfilled, and (ii) Seller has provided Buyer with a copy of the minutes of all the meetings of the Workers' Council of Porges held in this respect that were made available to Seller.

5.15          Properties

(a)                Section 5.15(a) of the Disclosure Letter contains a list of all Leases to be assigned to Buyer in accordance with Article 2 (the "Assigned Leases") and all Leases held by the Transferred Subsidiaries (the "Subsidiary Leases", which, together with the Assigned Leases, the Transferred Real Property and the Subsidiary Real Property shall hereinafter be referred to as the "Real Property").  To the Knowledge of Seller, all facilities leased or subleased under any Assigned Lease or Subsidiary Lease are supplied with utilities and other services adequate for  the conduct of the Business at such facility as it is currently being conducted and all such facilities are provided legal access to public roads.

(b)               Neither Seller nor any of its Subsidiaries has received written notice that it is in default in any material respect under any Assigned Lease or Subsidiary Lease which notice has not been remedied or withdrawn, and, to the Knowledge of Seller, no other party to any Assigned Lease or Subsidiary Lease is default thereof in any material respect.  Each Assigned Lease and Subsidiary Lease is a valid and binding agreement of Seller or a Subsidiary of Seller, is in full force and effect and, to the Knowledge of Seller, is enforceable according to its terms, subject to the Enforceability Exceptions.

(c)                Seller or its Subsidiaries has good and valid title to the Transferred Real Property and the Subsidiary Real Property, subject to Permitted Encumbrances.  There are no pending or, to the Knowledge of Seller, threatened condemnation proceedings relating to the Transferred Real Property or the Subsidiary Real Property.  All facilities located on the Transferred Real Property and the Subsidiary Real Property are supplied with utilities and other services adequate for  the conduct of the Business at such facility as it is currently being conducted and all such facilities are provided legal access to public roads.  The improvements constructed on the Transferred Real Property and the Subsidiary Real Property are suitable for the conduct of the Business as it is currently being conducted. 

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5.16          Environmental Matters

(a)                No Environmental Condition exists with respect to the Transferred Business or the Transferred Assets that would constitute a violation in any material respect of any Environmental Laws or otherwise give rise to any material liability under any Environmental Laws.  Neither Seller nor any of its Subsidiaries has received any written notice, citation, summons, order or complaint, and no penalty has been assessed within the two-year period preceding the Offer Date or is pending or, to the Knowledge of Seller, threatened, by any third Person (including any Governmental Authority) with respect to the Management or Release of, or exposure to any Hazardous Substance by or on behalf of Seller (with respect to the Business) or any of its predecessors or in relation to its past or present conduct of the Business for which either the Seller or any of its Subsidiaries has any remaining material Liability.  Neither Seller nor any of its Subsidiaries has received and, to the Knowledge of Seller, no one else has received, any request for information, notice of claims, demand or other notification that it (or any of its predecessors with respect to the Business) is or may be potentially responsible with respect to any investigation, cleanup remedial action or other response action ("Remediation") of Hazardous Substances (whether on-site or off-site) in connection with the Business for which either the Seller or any of its Subsidiaries has any remaining material Liability.

(b)               No Hazardous Substances have been Released by Seller or any Transferred Subsidiary or, to the Knowledge of Seller, by any other Person at any property now formerly owned, operated or leased by Seller or a Transferred Subsidiary in connection with the Business in such manner as would reasonably be expected to result in a material Liability to Seller or any of it Subsidiaries or require any Response Action.

(c)                Section 5.16(c) of the Disclosure Letter contains a list of the Environmental Permits held by Seller and its Subsidiaries.

(d)               No representations in this Article 5 other than this Section 0 shall apply to Liabilities and other matters respecting Environmental Claims, Environmental Conditions, Environmental Permits and the violation of Environmental Laws.

5.17          Transferred Inventory

The Transferred Inventory has been maintained in the ordinary course of business, is of good and merchantable quality; and is in a condition that in Seller's reasonable judgment consistent with past practice is useable, leaseable or saleable in the ordinary course of business taking into account the remaining shelf life and expected demand, subject to the inventory reserve determined consistent with past practice for slow-moving, excess non-saleable or obsolete inventory as recorded on the Financial Statements in good faith in accordance with GAAP.  All Transferred Inventory, whether reflected on the Financial Statements or subsequently acquired, (a) is located on the Real Property described on Section 5.17 of the Disclosure Letter or is in consignment stock in the possession of Seller's customers or distributors in the ordinary course of business consistent with past practice and (b) has been acquired, developed or manufactured by Seller only in bona fide transactions entered into in the ordinary course of business.  Except as described in Section 5.17 of the Disclosure Letter, Seller has valid legal title to the Transferred Inventory free and clear of any consignments, Encumbrances, claims or charges other than Permitted Encumbrances. 

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5.18          Accounts Receivable

Except as described on Section 5.18 of the Disclosure Letter, the accounts receivable balances shown on the Financial Statements represent actual amounts due and owing from bona fide sales and services transactions completed in accordance with the terms and provisions contained in the documents, if any, relating thereto.  The reserves for uncollectible accounts receivable reflected on the Financial Statements were established in accordance with GAAP in light of all the facts then known to Seller and Seller's historical methods and practices in establishing such reserves. 

5.19          Litigation

There is no action, suit, claim or proceeding of any nature with respect to the Business pending, or to the Knowledge of Seller, threatened, against Seller or any of its Subsidiaries, their respective assets, properties, rights (tangible or intangible) or any of their respective officers or directors.  There is no investigation or other proceeding with respect to the Business (excluding any routine inspections) pending or, to the Knowledge of Seller, threatened, against Seller or any of its Subsidiaries, any of their respective properties (tangible or intangible) or any of their officers or directors by or before any Governmental Authority.  No Governmental Authority has at any time challenged the legal right of Seller or any of its Subsidiaries to conduct the Business without restriction as presently or previously conducted. 

5.20          Products Liability

(a)                Neither Seller nor any of its Subsidiaries has received any written notice with respect to any material pending claim involving any Product sold by or on behalf of Seller or any of its Subsidiaries resulting from an alleged defect in design, manufacture, materials, testing or workmanship, performance, or any alleged failure to warn, or from any alleged breach of warranty, express or implied, or any alleged noncompliance with any applicable Laws.

(b)               Except as set forth in Section 5.20(b) of the Disclosure Letter, during the five (5) year period ending on the Offer Date there has been no recall or rework in the field or in the internal business or manufacturing processes, or post-sale warning or similar action (collectively, a "Recall") conducted by Seller or any of its Subsidiaries with respect to any Product sold by or on behalf of Seller or its Subsidiaries, and there are no facts or circumstances which are reasonably expected to lead to a Recall.

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5.21          Customers and Suppliers

(a)                Section 5.21(a) of the Disclosure Letter sets forth the thirty (30) largest customers of Seller and its Subsidiaries relating to the Business by revenue for the fiscal year ended March 31, 2005.  As of the Offer Date, neither Seller nor any Transferred Subsidiary has received notification that any such customer of the Business intends to terminate or adversely change its relationship with Seller or any Transferred Subsidiary, as applicable, with respect to the Business.

(b)               Section 5.21(b) of the Disclosure Letter sets forth (i) the twenty (20) largest suppliers to Seller and its Subsidiaries related to the Business for the fiscal year ended March 31, 2005, measured by the amount of payments made to such Persons in connection with the Business, (ii) all contract manufacturers used by Seller or its Subsidiaries in connection with the Business and (iii) any sole source suppliers of the Business.  As of the Offer Date, neither Seller nor any or any Transferred Subsidiary, as applicable, has received notification that any such supplier intends to terminate or adversely change its relationship with Seller or any Transferred Subsidiary, as applicable, with respect to the Business.

5.22          Compliance With Health Care Laws

(a)                Neither Seller nor any of its Affiliates or Subsidiaries participate in the United States healthcare programs of Medicare, Medicaid, or their counterparts worldwide, or any other health care programs of a Governmental Authority, or third party payment programs in any jurisdiction (collectively, "Programs") and nor are they a party to participation agreements for payments by such Programs.

(b)               Neither Seller nor any of its Affiliates or Subsidiaries has been the subject of any investigation by a Governmental Authority, whether in the United States or overseas, as a result of or in connection with Seller's or any of its Affiliates' or Subsidiary's pricing, production, distribution, marketing or sales activities related to the Products or related services. To Seller's Knowledge, Seller and each of its Affiliates and Subsidiaries have complied in all material respects with all applicable Laws regarding distribution, marketing and sales of Products and services.

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(c)                Seller and each of its Affiliates and Subsidiaries is, and at all times has been, in compliance with all relevant federal and other health care Laws applicable to the Business, including the federal Anti-kickback and Fraud and Abuse Prohibition Statutes (42 U.S.C. § 1320a‑7b) and to Seller's Knowledge all other Laws prohibiting false statements and improper remuneration for purchasing services or products, the civil False Claims Act (31 U.S.C. §§ 3729 et seq.), the administrative False Claims Law (42 U.S.C. § 1320a-7b(a)), the Health Insurance Portability and Accountability Act of 1996 (42 U.S.C. § 1301 et seq. and implementing regulations), the exclusion laws, SSA § 1128 (42 U.S.C. 1320a-7) and the regulations promulgated pursuant to such laws and regulations, relating to the regulation of the Business (collectively, "Health Care Laws"), except for failures of compliance that, individually or in the aggregate, have not or would not reasonably be expected to have a Seller Material Adverse Effect, and no change in the current conduct of the Business, or its internal procedures or processes, is required in order to so comply.

5.23          FDA and Global Regulation Compliance

(a)                Seller and each of the Transferred Subsidiaries has obtained each federal, state, county, local or non-U.S. Business Permit (including all those that may be required by the Federal Food and Drug Administration (the "FDA") or any other Governmental Authority engaged in the regulation of the Products, the Business or the Business's manufacturing and other quality systems) that is required for or has been applied for in operating the Business in any location in which it is currently operated and all of such Business Permits are in full force and effect.  Section 5.23(a) of the Disclosure Letter lists all annual manufacturing registration and device listing, annual reports and similar regulatory filing requirements that are required to be filed within six months after the Offer Date in order to maintain Business Permits and manufacturing facility licenses and where failure to timely file would result in a Seller Material Adverse Effect.  Neither Seller nor any of the Transferred Subsidiaries has received any notice or written communication with respect to the Business from any Governmental Authority regarding, and, there are no facts or circumstances that are likely to give rise to, (i) any violation of applicable Law or material adverse change in any Business Permit, or any failure to materially comply with any applicable Law or any term or requirement of any Business Permit or (ii) any revocation, withdrawal, suspension, cancellation, limitation, termination or modification of any Business Permit.  No such Business Permit will be terminated or impaired, or will become terminable, in whole or in part, as a result of the consummation of the transactions contemplated by this Agreement.

(b)               The operation of the Business, including the manufacture, import, export, testing, development, processing, packaging, labeling, storage, marketing, and distribution of all Products, is and at all times has been in material compliance with all applicable Laws, Business Permits, Governmental Authorities and orders including those administered by the FDA for products sold in the United States.  There is no actual or, to the Knowledge of Seller, threatened material action or investigation in respect of the Business by the FDA or any other Governmental Authority which has jurisdiction over the operations, properties, products or processes of the Business or the Transferred Subsidiaries, or, to the Knowledge of Seller, by any third parties acting on their behalf.  Seller has no Knowledge that any Governmental Authority is considering such action or of any facts or circumstances that are likely to give rise to any such action or investigation.

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(c)                Except as set forth in Section 0 of the Disclosure Letter, during the three (3) year period ending on the Offer Date, neither Seller nor any Transferred Subsidiary has had any product or manufacturing site subject to a Governmental Authority (including FDA) shutdown or import or export prohibition, nor received any FDA Form 483 or other Governmental Authority notice of inspectional observations, "warning letters," "untitled letters" or, to the Knowledge of Seller, requests or requirements to make changes to the operations of the Business or Products that if not complied with would reasonably be expected to result in a Seller Material Adverse Effect, or similar correspondence or written notice from the FDA or other Governmental Authority in respect of the Business and alleging or asserting noncompliance with any applicable Laws, Business Permits or such requests or requirements of a Governmental Authority, and, to the Knowledge of Seller, neither the FDA nor any Governmental Authority is considering such action.  Except as set forth in Section 0 of the Disclosure Letter, no vigilance report or medical device report with respect to the Business or the Products has been reported to Seller during the 90 day period ending on the Offer Date, and to the Knowledge of Seller, as of the Offer Date no vigilance report or medical device report is under investigation by any Governmental Authority with respect to the Products or the Business.

(d)               All studies, tests and preclinical and clinical trials in respect of the Business being conducted by or on behalf of Seller or any Transferred Subsidiary that have been or will be submitted to any Governmental Authority, including the FDA and its counterparts worldwide, including in the European Union, in connection with any Business Permit, are being or have been conducted in compliance in all material respects with the required experimental protocols, procedures and controls pursuant to accepted professional scientific standards and applicable local, state, federal and foreign Laws, rules and regulations, including the applicable requirements of Good Laboratory Practices, Good Clinical Practices, Good Manufacturing Practices and the U.S. Food, Drug and Cosmetic Act of 1938 and its implementing regulations, including 21 CFR Parts 50, 54, 56, 58, and 812.  Neither Seller nor any Transferred Subsidiary has received any notices, correspondence or other communication in respect of the Business from the FDA or any other Governmental Authority requiring the termination or suspension of any clinical trials conducted by, or on behalf of, Seller or in which Seller has participated, and to the Knowledge of Seller neither the FDA nor any other Governmental Authority is considering such action.  During the six month period ending on the Offer Date, neither Seller nor any Transferred Subsidiary has received specific written notification from a Governmental Authority of the rejection of data obtained from any clinical trials conducted by, or on behalf of, Seller or in which Seller has participated with respect to the Business or Products, which data was submitted to the Governmental Authority and which was necessary to obtain regulatory approval of a particular Product.

(e)                The manufacture of Products by, or on behalf of, Seller or any Transferred Subsidiary is being conducted in compliance in all material respects with all applicable Laws including the FDA's Quality Systems Regulation at 21 CFR Part 820 for products sold in the United States, and the respective counterparts thereof promulgated by Governmental Authorities in countries outside the United States.  Seller and each of the Transferred Subsidiaries, and, to the Knowledge of Seller, any third party assembler, sterilizer or manufacturer of Products, components or accessories, are in material compliance with all applicable Laws and certifications currently held by Seller governing quality systems, manufacturing processes and all other quality standards, registration and listing requirements governing those third parties' activities, including set forth in 21 CFR Part 807 and 21 CFR Part 820 for products sold in the United States and all other similar applicable Laws.

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(f)                 Neither Seller nor any of the Transferred Subsidiaries is the subject of any pending or, to the Knowledge of Seller, threatened investigation in respect of the Business by the FDA pursuant to its "Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities" Final Policy set forth in 56 Fed. Reg. 46191 (September 10, 1991) and any amendments thereto.  Neither Seller nor any of its Transferred Subsidiaries has committed any act, made any statement, or failed to make any statement, in each case in respect of the Business and that would provide a basis for the FDA to invoke its policy with respect to "Fraud, Untrue Statements of Material Facts, Bribery and Illegal Gratuities" and any amendments thereto.  Neither Seller nor any of the Transferred Subsidiaries or any of their respective officers, Employees or agents has been convicted of any crime or engaged in any conduct that could result in a material debarment or exclusion (i) under 21 U.S.C. Section 335a, or (ii) any similar applicable state Law.  To the Knowledge of Seller, no debarment or exclusionary claims, actions, proceedings or investigations in respect of the Business are pending or threatened against Seller, any of the Transferred Subsidiaries or any of their respective officers, employees or agents, except for such debarments, claims, actions, proceedings or investigations that, individually or in the aggregate, have not or would not reasonably be expected to have a Seller Material Adverse Effect.

5.24          Restrictions on Business Activities

There is no Contract or commitment to which Seller or any Transferred Subsidiary is a party or by which they are bound limiting or restricting in any material respect the right of Seller or any Transferred Subsidiary to engage in any line of business relating to the Business or to compete without restriction with any Person, in each case which would or could be reasonably expected to apply to the activities of Buyer after the Closing with respect to the Business.

5.25          Sufficiency

The Transferred Assets and the Transferred IPR, and the assets of the Transferred Subsidiaries (other than Excluded Assets) acquired by Buyer as a matter of law as a result of Buyer's acquisition of the Transferred Equity Interests and any rights or licenses granted or services provided pursuant to any other commitment or Contract entered into pursuant to this Agreement (subject to the limitations therein and in the related exhibits thereto), constitute all the assets, properties, interests in properties, and rights owned or licensable by Seller or its Subsidiaries and used or necessary to conduct the Business after the Closing as currently conducted. 

5.26          Exclusive Warranties

Except for the express representations and warranties set forth in this Agreement, neither Seller nor any of its Subsidiaries makes any representation or warranty, express or implied, with respect to the Transferred Assets, the Transferred IPR and the Assumed Liabilities, which are being sold "AS IS" in all respects with all faults and without any other warranties of any kind.  EXCEPT AS SPECIFICALLY CONTAINED HEREIN, SELLER EXPRESSLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY, NON‑INFRINGEMENT, VALIDITY, ENFORCEABILITY, OR SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF BUYER'S, WHETHER OR NOT SELLER HAS BEEN MADE AWARE OF ANY SUCH PURPOSE.

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5.27          Insurance

Section 0 of the Disclosure Letter lists all insurance policies reasonably related to the Transferred Business.  All premiums due and payable under all such policies have been paid, and Seller is otherwise in material compliance with the terms of such policies (or other policies providing substantially similar insurance coverage). Seller does not have Knowledge of the threatened termination of, or a material increase in premium with respect to, any of such policies.

5.28          Compliance with Conduct of Business Covenant

During the period from the Offer Date until the date of this Agreement, Seller has conducted, and has caused each of its Subsidiaries to conduct, the Business in a manner that does not violate the covenants set forth in Section 8.2 hereof.

Article 6

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby makes the following representations and warranties to Seller as of the Offer Date:

6.1              Organization of Buyer

Buyer is a duly incorporated and validly existing corporation in good standing under the Laws of Denmark, with all requisite power and authority to own its properties and conduct its business, including the discharge of its obligations with respect to the Assumed Liabilities, and is duly qualified in each jurisdiction in which its ownership of property, including the Transferred Assets, and its conduct of business, including the performance of the Assumed Liabilities, requires such qualification, except where the failure to so qualify would not, individually, or in the aggregate, be reasonably likely to have a material adverse effect on Buyer.

6.2              Authorization

Buyer has the requisite power and authority to execute and deliver this Agreement and each of the other Operative Agreements to which it is a party, and to perform its obligations hereunder and thereunder.  This Agreement has been, and each of the other Operative Agreements to which it or a Buyer Subsidiary is a party will be, upon their execution and delivery, duly and validly authorized, executed and delivered by Buyer and/or any Buyer Subsidiary, and this Agreement constitutes, and each of the other Operative Agreements to which it and/or any Buyer Subsidiary is a party will constitute, the valid and binding agreement of Buyer and/or such Buyer Subsidiary enforceable against Buyer and/or such Buyer Subsidiary in accordance with its respective terms, subject to the Enforceability Exceptions.  No other actions or proceedings on the part of Buyer are necessary to authorize Buyer's execution or performance of this Agreement or any of the Operative Agreements to which it is a party or the transactions contemplated hereby or thereby.

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6.3              No Violation

The execution and delivery by Buyer of this Agreement and each of the other Operative Agreements to which it is a party does not, and the performance by Buyer of its respective obligations hereunder and thereunder will not: (a) conflict with, or result in a breach of, any of the provisions of its charter documents or bylaws; (b) materially breach, violate or contravene any applicable Laws; (c) be prevented or delayed as a result of a breach of the UK OFT Undertakings; or (d) conflict in any material respect with, or result in a material breach of or default under, any material Contract to which Buyer is a party or by which Buyer or any of its properties may be affected or bound.

6.4              Government Consents

No material Governmental Actions on the part of Buyer are required in connection with the execution or delivery by Buyer of this Agreement or any of the other Operative Agreements or the consummation by Buyer of the transactions contemplated hereby or thereby, other than pursuant to HSR and such Governmental Actions set forth on Schedule 9.3.

6.5              Purchase for Investment; Accredited Investor

Buyer is aware that the Transferred Equity Interests were not registered under the Securities Act, or any other applicable securities Laws, and were issued pursuant to exemptions therefrom.  Buyer is purchasing the Transferred Equity Interests solely for investment, with no present intention to distribute any Transferred Equity Interests to any Person, and Buyer will not sell or otherwise dispose of any Transferred Equity Interests except in compliance with the registration requirements or exemption provisions under the Securities Act and the rules and regulations promulgated thereunder, or any other applicable securities Laws.  Buyer has substantial experience in evaluating and investing in securities in companies similar to the Transferred Subsidiaries and acknowledges that it can protect its own interests.  Buyer has such knowledge and experience in financial and business matters so that it is capable of evaluating the merits and risks of its acquisition of the Transferred Equity Interests.  Buyer is an "accredited investor" within the meaning of Rule 501(a) of Regulation D, promulgated by the Securities and Exchange Commission under the Securities Act.

6.6              No Broker

None of Buyer or any Subsidiary of Buyer, has engaged any Person, other than J.P. Morgan Chase & Co. (the fees of which shall be paid by Buyer), which is entitled to any fee or commission as a finder or a broker in connection with this Agreement or the transactions contemplated hereby.

6.7              Financing

Buyer has available, and will have available on the Closing Date, sufficient funds to enable it to consummate the transactions contemplated hereby and by the other Operative Agreements.

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6.8              Litigation

There is no action, suit, claim or proceeding of any nature pending, or to the Knowledge of Buyer, threatened against Buyer or any of its Subsidiaries, their respective assets, properties, rights (tangible or intangible) or any of their respective officers or directors that, individually or in the aggregate, has had or is reasonably likely to have a Buyer Material Adverse Effect, nor to the Knowledge of Buyer is there any reasonable basis therefor.  Buyer is not subject to any order, judgment, consent decree, settlement agreement or other Contract that would reasonably be expected to result in a Buyer Material Adverse Effect.

Article 7

EMPLOYEE TRANSFERS AND BENEFITS

7.1              Voluntary Transfer Employees

(a)                Offers of Employment.  No later than the tenth (10^th) Business Day after Seller delivers Schedule 7.1(a) to Buyer, Buyer will extend an offer of employment to (i) each Employee on Seller's U.S. payroll and listed on Schedule 7.1(a) (each, a "U.S. Employee") and (ii) each Employee who is not on Seller's U.S. payroll or employed by a Transferred Subsidiary and who is listed on Schedule 7.1(a) ((i) and (ii) collectively, the "Offered Employees").  The employment of each Employee who is employed by a Transferred Subsidiary (each a "Transferred Subsidiary Employee") will continue uninterrupted at Closing without the Buyer extending an offer of employment. Each such offer shall provide for employment by Buyer effective only as of and after the Closing Date and at a job responsibility level and title that is substantially similar to or higher than such Offered Employee's employment with Seller for the year prior to the date of the offer.  Effective only as of the Closing and after the Closing Date, Buyer will hire each Offered Employee who accepts the offer of employment extended to such individual by Buyer.  Notwithstanding the foregoing, any U.S. Employee who is, at the time an offer of employment is required under this Section 7.1(a), on a Seller (or a Subsidiary thereof) approved leave of absence from work, shall not become an employee of Buyer (and shall not be considered a Transferred Employee) unless and until such employee becomes eligible to return to active employment within one year after the Closing Date in accordance with Seller's human resource policies and applicable Laws and is accepted for employment by Buyer in its discretion and actually commences employment with Buyer.

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(b)               Service Credit; Waivers; Credits.  As soon as reasonably practicable following the Closing, Seller shall provide Buyer with a certificate of creditable coverage under HIPAA for all U.S. Transferred Employees.  Buyer shall provide each Transferred Employee with credit for purposes of eligibility, vesting and benefit accrual (other than under a defined benefit plan intended to benefit Employees located in the U.S.) under the Buyer Benefits Plans for Years of Service on and prior to the Closing Date with Seller and its Subsidiaries credited under the comparable Seller Benefits Plans, including recognition of such service for purposes of determining Transferred Employees' amount of paid time off or vacation and severance benefits; provided, however, that in no event shall Buyer be required to provide any service credit to any Transferred Employee to the extent the provision of such credit would result in any duplication of benefits.  To the extent permitted by applicable Law, Buyer shall cause any pre‑existing conditions or limitations and eligibility waiting periods (to the extent that such waiting periods would be inapplicable under Seller Benefits Plans) under any Buyer Benefits Plans to be waived with respect to Transferred Employees and their eligible dependents.  To the extent permitted by applicable Law, Buyer shall provide the Transferred Employees and their eligible dependents with credit for any deductibles and annual out‑of‑pocket limits for medical, dental and vision expenses paid during the applicable period under any Seller Benefits Plans in satisfying any deductibles and annual out‑of‑pocket limits for medical, dental and vision expenses for the corresponding period under the Buyer Benefits Plans.

(c)                401(k) Plan.  To the extent permitted under Section 401(k) of the Code and regulations issued thereunder, Voluntary Transfer Employees who participate in Seller's 401(k) plan shall be eligible to receive, at their election, a distribution of their account balance from Seller's 401(k) plan after the Closing Date.  Buyer shall use reasonable efforts to cause its 401(k) plan to accept eligible rollovers of such distributions, provided that Buyer determines that receipt of any such rollover will not result in a disqualification of Buyer's 401(k) plan.  Rollovers relating to any Voluntary Transfer Employee may include participant loans.

(d)               FSA.  Promptly after the Closing Date, Seller shall transfer and Buyer shall accept the flexible spending account elections, liabilities and accounts (maintained pursuant to Code Sections 105 and 129) of the Voluntary Transfer Employees under Seller's Section 125 plan flexible spending arrangement.  Promptly after the Closing Date, Seller shall cause to be transferred to Buyer the aggregate net cash amount (determined immediately prior to the Closing) for contributions paid (but not yet reimbursed) by or on behalf of the Voluntary Transfer Employees under Seller's Section 125 plan flexible spending arrangement.

(e)                Vacation.  Seller shall allow Transferred Employees to transfer any accrued but unused vacation time (which vacation time was accrued in accordance with Seller's policies consistent with past practice) to Buyer.   With respect to Voluntary Transfer Employees, only those Voluntary Transfer Employees who submit a vacation consent form, prior to the Closing Date, are eligible to transfer vacation time to Buyer.  To the extent permitted by Law, Buyer shall assume such accrued but unused vacation time of the Transferred Employees and allow each Transferred Employee to use such accrued vacation time after the Closing Date.  The transfer of vacation time shall not affect each Transferred Employee's accrual of vacation under Buyer's vacation policies.  Seller shall be liable for and pay in cash an amount equal to any accrued but unused vacation time to any (i) Voluntary Transfer Employee who has not executed a vacation consent form or (ii) any Offered Employee who declines to accept Buyer's offer of employment made in accordance with Section 7.1(a) and whose employment terminates prior to the Closing Date.

. 

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7.2              Automatic Transfer

(a)                Transfer of Obligations.  Immediately upon the Closing Date, all rights, powers and Liabilities of Seller and its Subsidiaries to, or in respect of, the Automatic Transfer Employees (including the rights, powers and Liabilities under, in connection with or arising from a Contract of employment or employment relationship between an Automatic Transfer Employee and Seller or a Subsidiary of Seller) in force immediately prior to the Closing Date shall be transferred to Buyer upon Closing in accordance with applicable Laws.  Buyer and Seller agree to fully and timely comply with all applicable provisions of the European Union Acquired Rights Directive and other similar country‑specific legal standards or applicable Laws.

(b)               Retirement Benefits.  With respect to Automatic Transfer Employees only and subject to the requirements of applicable Laws, Buyer and Seller agree as follows:

(i)            Except to the extent that applicable local Law requires more favorable benefits to be provided, Buyer shall provide Retirement Benefits in respect of service with Buyer following the Closing, which are substantially similar to the benefits provided for or in respect of Automatic Transfer Employees under Seller Retirement Plans immediately prior to the Closing;

(ii)            Subject only to the requirements of local Law in the relevant jurisdiction, Buyer shall not assume any accrued Retirement Benefits liabilities relating to the Automatic Transfer Employees in respect of their Years of Service prior to the Closing.  If Buyer is required by local Law or the terms of any existing Seller Retirement Plan to assume any accrued Retirement Benefits liabilities relating to the Automatic Transfer Employees in respect of their Years of Service prior to the Closing, and provided the assets associated with such liabilities are retained by Seller (or a Subsidiary thereof) at the Closing, Seller will treat all such Retirement Benefits liabilities as Excluded Liabilities and, to the extent required by the terms of the applicable Seller Retirement Plan and applicable Law, shall pay all such benefits as and when they become payable; and

(iii)            Years of Service in respect of the Automatic Transfer Employees under any Seller Retirement Plan shall count as Years of Service under any relevant retirement benefit arrangement operated or nominated by Buyer for the purpose of vesting, eligibility for benefits, early retirement or termination subsidies, levels of contribution and, subject to Section 0 (relating to non‑duplication of benefits) and Section 7.2(b)(i), benefit accrual.

7.3              Compensation and Benefits

Buyer will compensate each Transferred Employee (so long as any such Transferred Employee remains employed by Buyer or an Affiliate thereof, and subject to Buyer's termination rights and resulting severance obligations under Section 7.5) for at least one year after the Closing as follows:

(a)                at a rate of total cash compensation, including base salary rate and target bonus opportunity, which shall be at least substantially similar in the aggregate to the total cash compensation opportunity provided to the Transferred Employee by Seller immediately prior to the date of this Agreement; and

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(b)               with Employee Benefits Plans (excluding stock-based incentive plans and employee stock purchase or stock option plans) that are at least substantially similar in the aggregate to the benefits provided under those Seller Benefits Plans in effect immediately prior to the Closing Date.

(c)                Notwithstanding anything to the contrary, any and all "stay", "retention", or incentive bonus(es) offered by Seller to its Employees, and regardless of when payable, shall be the sole and exclusive responsibility of Seller, and Buyer shall have no responsibility or liability therefor.

7.4              Information and Consultation

Buyer and Seller shall provide one another with such information, which information will be materially accurate and complete, and assistance at such times as either Party may reasonably request or as may be necessary for such Party or its Subsidiaries to comply with any requirement to consult with the Employees, a relevant trade union, or any other Employee representatives.

7.5              Severance

(a)                Buyer shall provide any Transferred Employee whose employment is terminated by Buyer (other than employees terminated (a) for Cause or (b) by reason of such employee's Poor Performance) or who resigns as a result of a Constructive Termination, in each case within the 12‑month period immediately following the Closing Date, with severance payments and benefits, which are no less favorable than the severance pay and benefits such employee would have received had he or she terminated employment with Seller on the Closing Date. 

(b)               Buyer and Seller agree to share equally the cost of the severance obligations owed to Shared Benefit Employees.

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7.6              Employment‑Related Assumed Liabilities

Buyer, to the exclusion of Seller, assumes, accepts and shall be fully responsible for any and all Losses, Liabilities or claims to the extent arising out of or relating to: (a) any Transferred Subsidiary Employee; (b) any Voluntary Transfer Employee employed by Mentor Benelux B.V.; (c) Buyer's alleged failure to make offers of employment to Offered Employees in keeping with its obligations under Section 7.1(a); (d) Buyer's employment of, or the termination of employment of any Transferred Employee, in each case only on or after the Closing Date; (e) any Buyer Benefits Plans; and (f) workers' compensation claims of any Voluntary Transfer Employee arising out of conditions with a date of injury (or, in the case of a claim relating to occupational illness or disease, the last significant exposure) that begins prior to but continues after the Closing Date (collectively referred to herein as "Buyer Employment Liabilities").  Notwithstanding the preceding sentence, Buyer shall retain responsibility for and continue to pay all medical, life insurance, disability and other welfare plan expenses and benefits for each Transferred Employee with respect to claims incurred by such Transferred Employees or their covered dependents on or after the Closing Date.  Buyer shall reimburse, indemnify and hold harmless each of the Seller Indemnified Parties and their respective Employee Benefits Plans from and against any and all Losses incurred by any of them in connection with any Buyer Employment Liabilities.  All Buyer Employment Liabilities shall be Assumed Liabilities for all purposes of this Agreement.

7.7              Employment-Related Excluded Liabilities

Seller, to the exclusion of Buyer, assumes, accepts and shall be fully responsible for any and all Losses, Liabilities or claims to the extent arising out of or relating to: (a) the employer-employee relationship, or Seller's employment or termination of employment, of any Transferred Employee, former Employee, any consultant or independent contractor, in each case, on or before the Closing Date; (b) any Seller Benefits Plans other than Foreign Benefit Plans; and (c) workers compensation claims of Voluntary Transfer Employees arising out of conditions with a date of injury, (or in the case of a claim relating to occupational illness or disease, the last significant exposure) that begins and ends on or before the Closing Date (collectively referred to herein as "Seller Employment Liabilities").  Notwithstanding the preceding sentence, Seller shall retain responsibility for and continue to pay all medical, life insurance, disability and other welfare plan expenses and benefits for each Transferred Employee with respect to claims incurred by such Transferred Employees or their covered dependents prior to the Closing Date.  Seller shall reimburse, indemnify and hold harmless each of the Buyer Indemnified Parties and their respective Employee Benefits Plans from and against any and all Losses whenever asserted or incurred by any of them in connection with any Seller Employment Liabilities.  All Seller Employment Liabilities shall be Excluded Liabilities for all purposes of this Agreement.

7.8              Timing of Claims Incurred

For purposes of Section 7.6 and Section 7.7, a claim is deemed incurred when all facts and circumstances giving rise to the claim have occurred and specifically: in the case of medical or dental benefits, when the services that are the subject of the claim are performed; in the case of life insurance, when the death occurs; in the case of long term disability benefits, when the disability occurs; in the case of workers compensation benefits, as described in Section 7.6 and Section 7.7 above; and otherwise, at the time the Transferred Employee or covered dependent becomes entitled to payment of a benefit (assuming that all procedural requirements are satisfied and claims applications properly and timely completed and submitted).

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7.9              Retention Payment

Within thirty (30) days after the Closing Date, Seller agrees to pay to each Transferred Employee who holds options exercisable for shares of Seller's common stock as of the Closing Date (the "Eligible Employees") one-half (1/2) of the Retention Payment for such Eligible Employee, less any applicable required withholdings.  Upon the first (1st) anniversary of the Closing Date, Buyer shall pay to each Eligible Employee then employed by Buyer or any of Buyer's Subsidiaries or Affiliates one-half (1/2) of the Retention Payment, less any applicable required withholdings.  If after the Closing Date and prior to the first (1st) anniversary of the Closing Date, the employment of any Eligible Employee is terminated (a) by the Buyer other than for Cause or Poor Performance or (b) as a result of a Constructive Termination, death or disability, Buyer shall pay to such terminated Eligible Employee one-half (1/2) of the Retention Payment within thirty (30) days after the date of such termination, less any applicable required withholdings.  No Eligible Employee shall otherwise be entitled to any Retention Payment if such Eligible Employee resigns or terminates his or her employment for any reason other than those set forth in the foregoing sentence.  "Retention Payment" means, for each Eligible Employee, an amount of cash equal to the difference between (A) the product of (x) the average closing price of Seller's common stock on the five (5) trading days preceding (but not including) the Closing Date multiplied by (y) the number of unvested stock options issued by Seller and held by an Eligible Employee as of the Closing Date, less (B) the total aggregate exercise price of all such stock options referred to in clause (y) above. 

Article 8

ADDITIONAL COVENANTS

8.1              Contracts

Beginning on the date hereof and ending 90 days following the Closing Date, each Party shall, and shall cause its respective Subsidiaries to, use commercially reasonable efforts to obtain, as soon as practicable, all Consensual Transfers and the Subsidiary Consents.  Anything in this Agreement to the contrary notwithstanding, nothing in this Agreement shall constitute an agreement to assign any Transferred Contract or any claim, right or benefit arising thereunder or resulting therefrom if the failure to obtain any Consensual Transfer with respect thereto would (i) constitute a breach of or other contravention thereof, (ii) be ineffective with respect to any party thereto, or (iii) in any way adversely affect the rights of Buyer or Seller, or their respective Subsidiaries, thereunder.  Pending receipt of such Consensual Transfers and for a period not to exceed three (3) years after the Closing Date, the Parties shall cooperate with each other to the extent practicable in establishing mutually agreeable, reasonable and lawful arrangements designed to provide to Buyer the benefits of use of such asset and to provide to Seller or a Subsidiary of Seller, as the case may be, the benefits that they would have obtained had the asset been conveyed to Buyer at the Closing.  To the extent that Buyer is provided the benefits pursuant to this Section 8.1 of any Contract, Buyer shall perform for the benefit of the other parties thereto the obligations of Seller or a Subsidiary of Seller, as the case may be, thereunder and pay, discharge and satisfy any related Liabilities that, but for the lack of a Consensual Transfer, would be Assumed Liabilities.  If, with respect to any Consensual Transfers, there is any financial cost to obtaining such consent, waiver, confirmation, novation or approval, then Seller shall bear such financial costs and any payment thereof.  In addition, Buyer shall reimburse, indemnify and hold harmless each of the Seller Indemnified Parties from and against any and all Losses incurred by it in connection with the good faith performance by Seller or any of it Subsidiaries of the obligations under (including any payment or incurrence of Liabilities by Seller or any of its Subsidiaries) those Contracts for which Buyer is provided the benefits pursuant to this Section 8.1.  If and to the extent that a Consensual Transfer is obtained after the Closing Date, the Contract for which such Consensual Transfer was obtained shall thereafter constitute a Transferred Asset and an Assumed Liability for all purposes under this Agreement.  Notwithstanding the foregoing, to the extent that any consents, novations or transfers applicable to the Transferred Assets, the Transferred IPR or the Assumed Liabilities are expressly addressed in the other Operative Agreements, such other provision shall be controlling and this Section 8.1 shall be deemed to apply only to the extent consistent with the intent of such other provision.

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8.2              Conduct of the Business

(a)                Except as set forth in Schedule 8.2(a), during the period from the date hereof and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, Seller shall, and shall cause each of its Subsidiaries to, except to the extent that Buyer shall otherwise consent in writing (such consent to not be unreasonably withheld, delayed or conditioned), use its commercially reasonable efforts to carry on the Business in all material respects in the ordinary course, and in compliance in all material respects with all applicable Laws, and to pay or perform the obligations of the Business when due.

(b)               Without limiting the generality of Section 8.2(a), except as permitted or required by the terms of any other Operative Agreement or as provided in Schedule 8.2(b), without the prior written consent of Buyer (such consent to not be unreasonably withheld, delayed or conditioned), during the period from the date hereof and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, Seller shall not do any of the following, and shall cause its Subsidiaries not to do any of the following:

(i)            except as required by applicable Laws or pursuant to written agreements in effect or written policies existing on the date hereof, (A) grant any material severance or termination pay to any Transferred Employee, (B) change the compensation payable to any Transferred Employee other than in the ordinary course, or (C) make any material change in any Employee Benefits Plan that by reason of this Agreement or applicable Law would reasonably be expected to increase, in any material respect, the liabilities of Buyer, except for such changes that are intended to apply to a population of employees of Seller and/or its Subsidiaries that is not limited to Transferred Employees;

(ii)            (A) hire any new employee at an annual base salary of over $100,000, which employee would become a Transferred Employee at Closing, (B) terminate the employment of any employee whose annual base salary as of the date hereof is over $100,000, if such employee would otherwise become a Transferred Employee at Closing;

(iii)            enter into any collective bargaining or labor Contract;

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(iv)           enter into any Contract or assignment which has the effect of transferring or licensing to any Person or otherwise extending, amending or modifying in any material respect any Transferred IPR, unless incidental to ordinary course commercial transactions and, in the case of distribution agreements, which are terminable within a reasonable period of time;

(v)            except as required by GAAP or the SEC, revalue any of the Transferred Assets in any material respect or make any change in accounting methods, principles or practices in any material respect applicable to the Transferred Assets;

(vi)           write down or write up the value of any Transferred Inventory, or determine as collectible any Transferred Accounts Receivable or any part thereof which were previously considered uncollectible, or write off as uncollectible any Transferred Accounts Receivable or any part thereof, except in each case for write downs, write ups, and write offs in the ordinary course of business consistent with past practice;

(vii)          pay, discharge or satisfy any claim, Encumbrance, obligation or Liability of the Business, other than (A) Permitted Encumbrances, (B) the payment, discharge or satisfaction of claims, Encumbrances, obligations or liabilities reflected or reserved against in the Most Recent Balance Sheet or (C) in the ordinary course of business;

(viii)         other than in the ordinary course of the Business or sale of inventory in the ordinary course, dispose of any Transferred Assets;

(ix)            create any Encumbrance on (a) any of the Transferred Assets other than a Permitted Encumbrance or (b) any of the Transferred IPR unless in or incidental to ordinary course commercial transactions;

(x)             enter into any Contract with respect to the Business that would either: (a) by its terms expressly require a non-cancellable payment by Seller or any of its Subsidiaries of more than $250,000 per year; or (b) be reasonably likely to cause a Seller Material Adverse Effect;

(xi)            fail to maintain or prosecute any IPR that would be Transferred IPR but for the failure to maintain or prosecute such IPR, other than in the ordinary course of Business;

(xii)           disclose any Transferred Trade Secrets or other confidential information constituting Transferred IPR to Persons not bound by confidentiality obligations;

(xiii)          voluntarily terminate or materially modify any Transferred Contract or Subsidiary Contract; or

(xiv)          agree in writing or otherwise to take any of the actions described in Sections 8.2(b)(i) through 8.2(b)(xiii) above.

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8.3              Access to Information

Except as may be necessary or appropriate to ensure compliance with respect to any applicable Laws and subject to any confidentiality obligations or applicable privileges (including privacy obligations under relevant employment law and attorney-client privilege), from the date of this Agreement until the Closing Date, Seller will (a) give Buyer and its authorized representatives access to financial and operating data and other information relating to the Transferred Business during normal business hours and upon reasonable prior notice, (b) give Buyer and its authorized representatives reasonable access to key employees of the Business, the identities of whom and the procedures and scope of which access to be mutually agreed upon by the Parties, (c) furnish to Buyer and its authorized representatives such financial and operating data and other information relating to the Transferred Business as Buyer may reasonably request, and (c) will instruct the Seller Representatives to cooperate with Buyer in its investigation of the Transferred Business, all for the purpose of enabling Buyer and its authorized representatives to conduct, at their own expense, legal, business and financial reviews, investigations and studies of the Transferred Business in connection with this Agreement and the transactions contemplated hereby; provided, however, that notwithstanding the foregoing, Seller shall not be required to provide any financial, operating data or other information that is not currently available through Seller's existing business processes or the creation of which would be unduly burdensome on Seller.  Notwithstanding the foregoing or any other provision of any other Operative Agreement, Buyer shall not have access to such price and other competitive information as may invoke antitrust or similar legal restrictions, as determined by Seller in its reasonable judgment.  Any access to Seller's Real Property shall be subject to Seller's reasonable security measures and insurance requirements and shall not include the right to perform any "invasive" testing.

8.4              Books and Records

For a period of six (6) years from the Closing Date, or for such longer period as is required by applicable Laws, Buyer will permit Seller or its authorized representatives reasonable access, at Seller's expense, to information relating to the Transferred Business to the extent required by Seller to permit it to determine any matter relating to its rights and obligations under the Operative Agreements and its compliance with applicable Tax and financial reporting requirements, and any claim asserted in connection with an Assumed Liability.

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8.5              Necessary Efforts; HSR Filings

(a)                Seller and its Subsidiaries and Buyer and its Subsidiaries agree to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Operative Agreements and to cause the conditions to each party's obligation to close the transactions contemplated hereby to be satisfied, including all actions necessary to obtain all licenses, certificates, permits, approvals, clearances, expirations or terminations of applicable waiting periods, authorizations, qualifications and orders, and including, for the avoidance of doubt, any actions necessary to ensure compliance with the UK OFT Undertakings (each a "Consent") of any Governmental Authority required for the satisfaction of the conditions set forth in Section 9.3 or Section 10.3, and necessary in connection with the consummation of the transactions contemplated by the Operative Agreements.  Each of Seller and its Subsidiaries and Buyer and its Subsidiaries agree that (i) no contact will be initiated with, or Consent sought from, any Governmental Authority prior to the Closing Date without the written consent of the other Party (such consent not to be unreasonably withheld, delayed or conditioned) other than with respect to antitrust or merger control matters, and (ii) each Party will be given prior notice of and a reasonable opportunity to consult with the other Party regarding contacts with Governmental Authorities regarding antitrust or merger control matters.  The Parties hereto shall cooperate fully with each other to the extent necessary in connection with the foregoing.

(b)               Buyer and Seller shall timely and promptly make all filings or submissions which may be required for the satisfaction of the condition set forth in Section 9.3 or Section 10.3 by each of them in connection with the consummation of the transactions contemplated hereby.  In furtherance and not in limitation of the foregoing, each of Seller and Buyer shall file notification and report forms under HSR or any other similar antitrust or merger control filings under applicable Laws as promptly as practicable following the date of this Agreement and in any event no later than (i) 10 Business Days following the date of this Agreement, in the case of notification and report forms under HSR, and (ii) the time prescribed by applicable Law in the case of requirements under other applicable antitrust or merger control Laws.  In addition, Buyer and Seller agree, and shall cause each of its Subsidiaries, as applicable, to cooperate and to use all necessary efforts and take all actions necessary to: obtain any Consents required for the Closing, including through compliance with HSR and any other applicable Laws, to respond to any requests for information from any Governmental Authority, and notwithstanding Section 8.5(c) below, to avoid and/or overcome any action, including any legislative, administrative or judicial action, and to have vacated, lifted, reversed or overturned any judgment, injunction or other order (whether temporary, preliminary or permanent) that restricts, prevents or prohibits, or could restrict, prevent or prohibit, the consummation of the transactions contemplated by this Agreement.  Without limiting the foregoing, Buyer and its Subsidiaries shall agree to divest, license, hold separate (through the establishment of a trust or otherwise) or otherwise dispose, or agree to dispose of assets as, or if, required to avoid or overcome the objections of any Governmental Authority (each, a "Remedial Action"); provided, however, that notwithstanding the foregoing, and, for the avoidance of doubt, with the exception of Remedial Action in respect of the UK OFT Undertakings (which is dealt with separately in Section 8.5(d) below), nothing contained in this Agreement shall be deemed to require Buyer or any of its Subsidiaries to take or agree to take any such action if such action would be reasonably likely to have a Buyer Material Adverse Effect on a combined basis with the Transferred Subsidiaries after the Closing.  Each party shall furnish to the other such necessary information and assistance as the other party may reasonably request in connection with the preparation of any necessary filings or submissions by it to any Governmental Authority.  Except as prohibited or restricted by Law, each party or its attorneys shall provide the other party or its attorneys the opportunity to make copies of all correspondence, filings or communications (or memoranda setting forth the substance thereof) between such party or its representatives, on the one hand, and any Governmental Authority, on the other hand, with respect to this Agreement, the other Operative Agreements or the transactions contemplated hereby or thereby.  Without in any way limiting the foregoing, the Parties will consult and cooperate with one another, and consider in good faith the views of one another, in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any party hereto in connection with proceedings under or relating to HSR or other antitrust or merger control Laws.

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(c)                Each of Buyer and Seller shall notify and keep the other advised as to (i) any material communication from the Federal Trade Commission (the "FTC"), the Antitrust Division of the United States Department of Justice (the "DOJ") or any other Governmental Authority regarding any of the transactions contemplated hereby, including, for the avoidance of doubt, any communications with the UK Competition Authorities in relation to the UK OFT Undertakings, (ii) any litigation or administrative proceeding pending and known to such party, or to its knowledge threatened, which challenges, or would challenge, the transactions contemplated hereby and (iii) any event or circumstance which, to its knowledge, would constitute a Warranty Breach; provided, however, that the failure of Seller or Buyer to comply with this Section 0 shall not subject Seller or Buyer to any Liability hereunder in respect of any claim asserted after the relevant expiration date for the relevant representation or warranty; and provided further, that neither Buyer nor Seller may separately recover pursuant to Article 11 or otherwise for both a breach of this Section 0 and any Warranty Breach.  Subject to the provisions of Article 11, Seller and Buyer shall not take any action inconsistent with their obligations under this Agreement or, without prejudice to Buyer's rights under this Agreement, which would materially hinder or delay the consummation of the transactions contemplated by this Agreement.

(d)               Buyer shall timely and promptly take all action necessary to ensure that the UK OFT Undertakings do not prevent or delay the consummation of the transactions contemplated by this Agreement, including taking all and any Remedial Actions or other steps required by the UK Competition Authorities.

8.6              Taxes and Costs Relating to the Porges Asset Sale

(a)                Notwithstanding any other provision of this Agreement, Buyer shall indemnify Seller and hold Seller harmless from and against any Liability for Taxes (including, without limitation, withholding and Transfer Taxes) and all costs (including third-party costs) incurred by Porges in connection with the Porges Asset Sale.

(b)               Buyer shall also pay to Seller the following additional amounts: (i) 90% of the amount of foreign tax credits attributable to the Porges Asset Sale (such foreign tax credits, for purposes of this Agreement, shall be $7,875,000) (the "FTC Amount") that are determined to be unavailable to Seller following an audit of Seller or the promulgation of Treasury Regulations with final effect disallowing such foreign tax credits; (ii) 90% of the amount by which the FTC Amount is reduced by operating losses of Porges following the Closing; and (iii) 100% of the amount by which the foreign tax credits of Porges that would have been attributable to the operating income of Porges for the Pre-Closing Tax Period (determined under the principles of Section 8.7(a)) are reduced by the operating losses of Porges following the Closing.  For purposes of this subsection (b), operating losses shall be used first to reduce the operating income of Porges, and then to reduce the gain from the Porges Asset Sale.

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(c)               Seller and Buyer shall provide each other with access to all information reasonably necessary to determine the accuracy of the amounts required to be determined by this Section 8.6.

8.7              Tax Matters

(a)               Returns; Indemnification; Liability for Taxes. 

(i)                Seller shall prepare and file (or cause to be prepared and filed) on a timely basis all Tax Returns with respect to Seller and its Subsidiaries for all taxable periods ending on or before the Closing Date and shall pay, and shall indemnify and hold Buyer harmless against and from (A) all Taxes of Seller and its Subsidiaries for all taxable years or periods that end on or before the Closing Date; (B) all Taxes for which Seller or any of its Subsidiaries may be liable under Treasury Regulation Section 1.1502‑6 (or any similar provision of state, local or foreign law); and (C) with respect to any taxable period commencing before the Closing Date and ending after the Closing Date (a "Straddle Period") all Taxes of Seller and its Subsidiaries attributable to the Tax period prior to and including the Closing Date (the "Pre-Closing Tax Period") (the Taxes referred to in items (A), (B), and (C) of this sentence are referred to herein as "Pre-Closing Taxes"); provided, however, that to the extent that any such Taxes (i) are reflected as a Liability in the calculation of Net Working Capital as reflected on the Final Net Working Capital Statement, or (ii) are described in Section 8.6(a) ((i) and (ii), collectively, the "Assumed Taxes"), such Assumed Taxes shall not be considered "Pre-Closing Taxes" hereunder, and Seller shall have no obligation to indemnify Buyer for any such Assumed Taxes.  For purposes of this Agreement, the portion of any Tax that is attributable to a Pre-Closing Tax Period shall be (A) in the case of a Tax that is not based on net income, gross income, premiums or gross receipts, the total amount of such Tax for the period in question multiplied by a fraction, the numerator of which is the number of days in the Pre-Closing Tax Period, and the denominator of which is the total number of days in such Straddle Period, and (B) in the case of a Tax that is based on any of net income, gross income, premiums or gross receipts, the Tax that would be due with respect to the Pre-Closing Tax Period if such Pre-Closing Tax Period were a separate taxable period, except that exemptions, allowances, deductions or credits that are calculated on an annual basis (such as the deduction for depreciation or capital allowances) shall be apportioned on a per diem basis. 

(ii)               Buyer shall prepare and file (or cause to be prepared and filed) on a timely basis all Tax Returns relating to the Transferred Assets or the operation of the Business (including all Tax Returns of the Transferred Subsidiaries) for periods ending after the Closing Date and shall pay and shall indemnify and hold Seller harmless against and from (A) all Taxes of Buyer and its Subsidiaries (including the Transferred Subsidiaries) for any taxable year or period commencing after the Closing Date; (B) all Taxes of Buyer and its Subsidiaries (including the Transferred Subsidiaries) for any Straddle Period other than Pre‑Closing Taxes; (C) all withholding Taxes incurred in connection with the transactions contemplated hereby; and (D) all Assumed Taxes.

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(iii)              If, in order to properly prepare its Tax Returns or other documents required to be filed with the Governmental Authorities, it is necessary that a Party be furnished with additional information, documents or records relating to the Transferred Assets, both Seller and Buyer agree to use commercially reasonable efforts to furnish or make available such nonprivileged information at the other's request, cost and expense; provided, however, that neither Party shall be entitled to review or examine the Tax Returns of the other Party (other than the Tax Returns related to MML, Porges and the Porges Asset Sale).

(b)               Refunds and Credits.  Any refunds and credits attributable to Pre‑Closing Taxes to the extent not taken into account in the calculation of Net Working Capital as reflected in the Final Net Working Capital Statement shall be for the account of Seller if properly reportable by Seller on any of its pre-Closing Tax Returns or with respect to any Pre-Closing Tax Period and any other refunds and credits shall be for the account of Buyer.  To the extent permitted by applicable Law, Buyer shall (or shall cause or permit its Subsidiaries to) elect to relinquish any carryback of a Tax attribute to any Pre-Closing Tax Period.  In cases where Buyer cannot elect to relinquish such carrybacks, Seller agrees to pay to Buyer the net Tax benefit received by Seller or any of its Subsidiaries from the use in any Pre-Closing Tax Period of a carryback of any Tax arising in a Post-Closing Tax Period.  If an audit or other examination of any Tax Return of Seller or its Subsidiaries for any taxable period ending on or before the Closing Date, or of Buyer or its Subsidiaries for any taxable period ending after the Closing Date, shall result (by settlement or otherwise) in any adjustment, the effect of which is to increase deductions, losses or tax credits or decrease income, gains, premiums, revenues or recapture of tax credits ("Changes") of the other party, the audited party will notify such other party and provide it with all necessary information so that it can reflect on its Tax Returns any such Changes.  If as a result of such Changes, the other party enjoys a net Tax benefit, such party shall pay to the audited party the amount of such net Tax benefit.

(c)               Transfer Taxes.  Notwithstanding any other provision of this Agreement, (i) all Transfer Taxes arising in connection with the Porges Asset Sale shall be borne by Buyer as set forth in Section 8.6 of this Agreement; and (ii) all other Transfer Taxes and related fees incurred in connection with the Operative Agreements, and the transactions contemplated hereby, shall be borne equally by Buyer and Seller.  To the extent reasonable and legally able to do so, Buyer and Seller shall cooperate with each other to minimize such Taxes.  The Party required by law to file a Tax Return with respect to such Transfer Taxes shall do so within the time period prescribed by law, and the other Party shall promptly reimburse the paying Party for such other Party's portion of the  Transfer Taxes so paid upon receipt of notice that such Transfer Taxes have been paid.

(d)               Post-Closing Actions by Buyer.  Following the Closing, Buyer shall not make any election under U.S. or foreign Tax law, cause any Transferred Subsidiary to pay a dividend, elect to carryback any loss or otherwise take any action that could adversely affect Seller without the prior written consent of Seller; provided, however, that, if requested by Seller, Buyer shall make a timely election under Section 338 of the Code, in form and substance satisfactory to Seller, with respect to the purchase of the Equity Interests of Porges and/or MML.

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(e)                Tax Audit Support.  In the event and for so long as any Party actively is contesting or defending against any Tax audit or other investigation, claim or proceeding relating to a taxable period ending on or prior to the Closing Date involving Seller or its Subsidiaries, each Party shall cooperate with the other Party and its counsel in the contest or defense, make available their personnel, and provide such testimony and access to their books and records as shall be necessary in connection with the contest or defense, all at the sole cost and expense of the indemnifying Party.

8.8               Allocation of Purchase Price

The Preliminary Purchase Price shall be provisionally allocated by Seller and Buyer mutually not later than ten Business Days prior to the Closing Date and shall be set forth in the form substantially similar to Exhibit F attached hereto (the "Preliminary Purchase Price Allocation").  Not later than 30 days following the preparation of the Final Net Working Capital Statement, the Preliminary Purchase Price Allocation shall be adjusted by mutual agreement of the Parties (or if the parties cannot agree within such 30 days, by the CPA Firm within the following 30 days) to take into account the final determined amount of the Purchase Price and the final determined values of all Transferred Assets, it being understood that any such adjustment shall not adjust the total cash consideration set  forth in any of the Conveyance Documents (such adjusted allocation, the "Purchase Price Allocation").  Upon its completion, the Purchase Price Allocation shall become part of the Agreement.  Each of the Parties, when reporting the transactions consummated hereunder in its own Tax Returns, shall allocate the Purchase Price paid or received, as the case may be, in a manner that is consistent with the Purchase Price Allocation.  Additionally, each of the Parties will comply with, and furnish the information required by, Section 1060 of the Code, and any regulations thereunder.

8.9              Return of Excluded Assets

Promptly following the Closing, and in any event within thirty (30) days after the Closing Date, Buyer will remit to Seller an amount of cash equal to the amount of cash on the general ledger of each Transferred Subsidiary as of the Closing.  The remittance will be treated as a return of Excluded Assets and not as an adjustment to the Purchase Price.  If at any time within 12 months following the Closing Date, Buyer becomes aware of any other Excluded Assets that were delivered to Buyer in connection with the Operative Agreements, Buyer shall promptly notify Seller of the Excluded Assets in its possession, and shall return (or at Seller's discretion, destroy) such Excluded Assets, including all copies thereof.  In any case, Buyer agrees to keep and treat all Excluded Assets as "Evaluation Material" in accordance with the terms of the Confidentiality Agreement.  

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8.10          Brokers

Seller shall be responsible for, and shall reimburse, indemnify and hold harmless Buyer for, all Losses arising from a claim by a finder or broker that it acted on behalf of Seller (or a Subsidiary thereof) in connection with the transactions contemplated hereby.  Buyer shall be responsible for, and shall reimburse, indemnify and hold harmless Seller for, all Losses arising from a claim by a finder or broker that it acted on behalf of Buyer (or a Subsidiary thereof) in connection with the transactions contemplated hereby.

8.11          Further Assurances

From and after the Closing Date, Seller shall cooperate with Buyer and its representatives and shall execute and deliver such documents and take such other actions as Buyer may reasonably request, for the purposes of evidencing the transactions contemplated by this Agreement and putting Buyer in possession and control of all of the Transferred Assets and Transferred IPR, especially to the extent located overseas; provided, however, that notwithstanding anything herein to the contrary, nothing herein shall require Seller or its Affiliates to assist or cooperate with Buyer or any of its Affiliates in connection with any actual or threatened litigation, arbitration, mediation or other alternative dispute resolution procedure regarding the Transferred Business, except to the extent required by applicable Law or Article 11 (Indemnity), and to the extent that Seller or its Affiliates are required to do so by applicable Law (as distinguished from Article 11 (Indemnity)), Buyer shall promptly reimburse Seller for all out-of-pocket Expenses that it incurs in connection therewith.  From and after the Closing Date, the parties shall cooperate with each other and each party's Representatives and shall execute and deliver such documents and take such other actions as the other party may reasonably request, for the purpose of evidencing the transactions contemplated by this Agreement and as otherwise set forth herein.  In addition, Buyer will make Transferred Employees reasonably available to Seller for the purpose of obtaining, maintaining, securing and defending the Intellectual Property Rights of Seller, at Seller's expense.

8.12          Mail Handling

Effective as of the Closing Date, Buyer and/or its Affiliates shall have the right to open all mail and packages delivered to it that are addressed to Seller or any of the Transferred Subsidiaries relating to the Transferred Business, the Transferred Assets, the Transferred IPR or the Assumed Liabilities.  To the extent that Buyer and/or any of its Subsidiaries receives any mail or packages addressed to Seller or any of its Subsidiaries and delivered to Buyer and/or any of its Affiliates not relating to the Transferred Business, the Transferred Assets, the Transferred IPR or the Assumed Liabilities, Buyer shall promptly deliver such mail or packages to Seller.  After the Closing Date, Buyer may deliver to Seller any checks or drafts made payable to Seller or any of its Subsidiaries that constitute a Transferred Asset, and Seller shall promptly deposit such checks or drafts, and, upon receipt of funds, reimburse Buyer within five Business Days for the amounts of all such checks or drafts, or, if so requested by Buyer, endorse such checks or drafts to Buyer for collection.  To the extent Seller or any of its Subsidiaries receives any mail or packages addressed and delivered to Seller but relating to the Transferred Business, the Transferred Assets, the Transferred IPR or the Assumed Liabilities, Seller shall, or shall cause such Subsidiaries to, promptly deliver such mail or packages to Buyer.  After the Closing Date, to the extent that Buyer or any of its Affiliates receives cash or checks or drafts made payable to Buyer that constitute an Excluded Asset, Buyer shall promptly use such cash to, or deposit such checks or drafts and upon receipt of funds from such checks or drafts, reimburse Seller within five Business days for such amount received, or, if so requested by Seller, endorse such checks or drafts to Seller for collection.

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8.13          Non‑Solicitation

(a)             Seller agrees that for a period of four (4) years from and after the Closing Date it shall not, and it shall cause and each of its Subsidiaries not to, without the prior written consent of Buyer, directly or indirectly, solicit to hire (or cause or seek to cause to leave the employ of Buyer or any of its Subsidiaries) (i) any Transferred Employee in the Territory, or (ii) any Person employed by Buyer or any of its Subsidiaries in the Territory who became known to or was identified to Seller or any of its Subsidiaries in connection with the transactions contemplated by this Agreement, unless, in the case of clause (i) or (ii) above, such Person ceased to be an employee of Buyer and/or its Subsidiaries at least six (6) months prior to such action by Seller or any of it Subsidiaries.

(b)             Except with respect to Transferred Employees, Buyer agrees that for a period of four (4) years from and after the Closing Date it shall not, and it shall cause each of its Subsidiaries not to, without the prior written consent of Seller, directly or indirectly, solicit to hire (or cause or seek to cause to leave the employ of Seller or any of its Subsidiaries) (i) any Person employed by Seller or any Subsidiary of Seller in the Territory immediately following the Closing or (ii) any Person employed by Seller or any Subsidiary of Seller in the Territory who became known to or was identified to Buyer or any of its Subsidiaries in connection with the transactions contemplated by this Agreement, unless, in the case of clause (i) or (ii) above, such Person ceased to be an employee of Seller and/or its Subsidiaries at least six (6) months prior to such action by Buyer or any of its Subsidiaries.

(c)              Notwithstanding the foregoing, the restrictions set forth in Section 8.13(a) and Section 8.13(b) shall not prohibit the placement of bona fide public advertisements for employment by any party and not specifically targeted at, in the case of Seller, any Transferred Employee or any Person employed by Buyer or a Subsidiary of Buyer or, in the case of Buyer, any person employed by Seller.  Section 8.13(a) shall not apply to any Person employed outside of the United States who is hired by Seller or any Subsidiary of Seller (i) pursuant to any existing agreement with employee representatives by which Seller or any Subsidiary of Seller are bound or (ii) as a result of actions required to be taken by Seller or any Subsidiary of Seller in order to comply with local employment Laws.

8.14            Pre-Closing Integration Planning

During the period beginning on the date hereof and continuing until the Closing, the Parties shall reasonably cooperate and communicate with one another concerning pre-Closing communications and integration planning communications on a country-by-country basis. 

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8.15          Confidentiality

(a)                Confidentiality Agreement.  The Confidentiality Agreement shall continue in full force and effect and survive the execution of this Agreement, the Closing, the consummation of the transactions contemplated hereby and/or the termination of this Agreement for seven (7) years.  The Parties hereby agree that the term "Evaluation Material," as used in the Confidentiality Agreement shall be deemed to include (i) all exhibits, schedules, certificates and other documents executed or delivered in connection with this Agreement, the other Operative Agreements and the consummation of the transactions contemplated hereby and thereby, (ii) all proprietary and confidential information concerning Seller and its Subsidiaries, which includes all information with respect to the Business, and (iii) all documents and materials contained in Seller's data room, or otherwise furnished or made available (directly or indirectly) to Buyer or its Subsidiaries; provided, however, that after the Closing, with respect to Buyer, the foregoing shall not apply to such information that (1) is solely related to the Transferred Subsidiaries, Transferred Assets, Transferred IPR or Assumed Liabilities and (2) is not also related to any business or assets of Seller (or a Subsidiary thereof) not transferred to Buyer under this Agreement.  In addition, notwithstanding any other provision of the Confidentiality Agreement, and this Agreement, Buyer and its Affiliates and Seller and its Affiliates may include this Agreement and the other Operative Agreements in or as an exhibit to any report, form or registration statement filed with or furnished to the SEC.  Seller agrees to treat and hold confidential any information concerning the Business and the affairs of the Business that is not (other than by virtue of Seller's violation of this Section 0) generally available to the public; provided, however, that nothing in this Section 0 shall prohibit Seller or any of its Subsidiaries from complying with applicable Laws or the rules and regulations of any stock exchange or over the counter trading market on or through which Seller's securities are traded.

(b)               Release of Certain Confidentiality Obligations.  Effective as of the Closing, Seller shall, or shall cause its applicable Subsidiary to, release the Transferred Employees from any confidentiality obligations they may have to Seller (or a Subsidiary thereof) with respect to trade secret, confidential and other information that relates to the Business, but only to the extent such information does not also relate to any business or assets of Seller (or a Subsidiary thereof) not transferred to Buyer (or a Subsidiary thereof) under this Agreement.

8.16          Non-Competition

(a)                Seller agrees that for a period commencing on the Closing Date and terminating on the seventh (7^th) anniversary of the Closing Date, Seller will not, and will cause its Subsidiaries and Affiliates not to, engage, directly or indirectly, in a Competing Business anywhere in the Territory.  The foregoing restrictions will terminate in the event of a Change of Control of Seller.  The foregoing restrictions are reasonable and appropriate, do not exceed the protection necessary to secure the goodwill purchased, and do not place undue hardship on Seller. 

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(b)               The remedy at law for any breach of the foregoing will be inadequate and Buyer, in addition to any other relief available to it, shall be entitled to temporary and permanent injunctive relief without the necessity of proving actual damages.  If any provisions of any restrictive covenant contained herein, should be deemed to exceed the limitations allowed by applicable Law, then such provision shall be reformed to provide the maximum limitations permitted. 

(c)                Notwithstanding the foregoing, the provisions of this Section 8.16 shall not restrict Seller or any Subsidiaries of Seller from acquiring and thereafter operating any Business Competitor (an "Acquired Entity") so long as (a) Seller or such Subsidiary, within three (3) months after such acquisition, offer to enter into good faith discussions for forty-five (45) days with Buyer for the purpose of providing Buyer the opportunity to (i) purchase the Competing Business from Seller or its Subsidiaries, or (ii) enter into a joint venture, distribution agreement or similar agreement with Seller or its Subsidiaries with respect to the Competing Business, with closing of a purchase (in (i)) or execution of an agreement (in (ii)) to occur within eighteen (18) months following the acquisition by Seller or its Subsidiaries of the Acquired Entity and (b) if Seller or such Subsidiary and Buyer fail to (i) consummate a transaction resulting in a purchase of the Competing Business by Buyer, or (ii) enter into a joint venture, distribution agreement or similar agreement with respect to the Competing Business after offering to enter into good faith discussions with Buyer for that purpose as contemplated by clause (a) above, Seller or such Subsidiary shall offer to enter into good faith discussions for forty-five (45) days with Buyer for the purpose of providing Buyer the opportunity to purchase the Competing Business from Seller or its Subsidiaries, or enter into a joint venture, distribution agreement or similar agreement with Buyer with respect to the Competing Business, if the terms offered are more favorable to those terms previously offered to the Buyer pursuant to clause (a) above, prior to entering into a similar arrangement with a third party.

8.17            Real Estate Matters

(a)              Real Property Lease Assignments.

(i)               Promptly following execution of this Agreement, Seller shall contact the Landlords under the Assigned Leases and seek each Landlord's consent to the assignment of the applicable Assigned Lease to Buyer and a release of Seller from further liability under the applicable Assigned Lease.  If Seller obtains prior to the Closing Date such consent, Seller shall assign to Buyer and Buyer shall accept from Seller an assignment of such Assigned Lease in accordance with Section 3.2 hereof (the "Real Property Lease Assignments").  Any such Real Property Lease Assignment shall be effective on the Closing Date and shall be on the terms of the lease assignment form reasonably acceptable to Buyer and Seller.

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(ii)            Seller shall use commercially reasonable efforts to obtain the consents and releases set forth in clause (i) above, but shall not be required to commence judicial proceedings for a declaration that a consent has been unreasonably withheld, delayed or conditioned.  Seller shall have the right, in its sole and absolute discretion, but shall not be required, to pay any additional consideration or provide any additional security or guarantees to the Landlords.  Buyer shall cooperate with Seller in attempting to obtain the consents and releases set forth above, including (i) providing financial statements, references and additional security and/or guarantees as may be requested by the relevant Landlords, (ii) entering into any amendments to the Leases as may be requested by the relevant Landlords or (iii) entering into direct Leases of the applicable premises leased under an Assigned Lease (the "Assigned Lease Premises") with the relevant Landlords, if requested by such Landlords.  Notwithstanding anything to the contrary in this Agreement, if the Landlord under any Assigned Lease conditions its grant of a consent (including by threatening to exercise a "recapture" or other termination right) upon, or otherwise requires in response to a notice or consent request regarding this Agreement or any Operative Agreement, the payment of a consent fee, "profit sharing" payment or other consideration (including increased rent payments), or the provision of additional security (including a guaranty), Buyer shall be solely responsible for making all such payments or providing all such additional security.  Notwithstanding anything to the contrary in this Agreement, in the event that Seller makes any such payments, Buyer shall promptly reimburse Seller for such amounts.  Buyer shall not, however, communicate directly with any of Seller's Landlords without the prior written consent of Seller.

(iii)            If, despite the efforts of the parties as set forth in clauses (ii) and (iii) above, a Landlord of an Assigned Lease Premises fails to consent to the assignment of the applicable Assigned Lease of such Assigned Lease Premises prior to the Closing Date, subject to Section 8.17(a)(iv) below:

(1)            Buyer shall be entitled to occupy the relevant Assigned Lease Premises as a licensee upon the terms and conditions contained in Seller's Assigned Lease of such Assigned Lease Premises.  Such license shall not be revocable due to the relevant Landlord's failure to consent, unless (A) the relevant Landlord formally, unconditionally refuses to consent or (B) an enforcement action or forfeiture by the relevant Landlord due to Buyer's occupation of such Assigned Lease Premises cannot, in the reasonable opinion of Seller, be avoided other than by requiring Buyer to immediately vacate the relevant Assigned Lease Premises.  In either such event, Seller may terminate the license by delivering written notice to Buyer, and Buyer shall vacate the relevant Assigned Lease Premises immediately or by such other date as may be specified in a notice served by Seller.  Buyer shall be solely responsible for, and shall indemnify, defend, protect and hold harmless Seller from, all losses, costs, damages, claims and liabilities incurred by Seller or Buyer as a consequence of Buyer's occupation of such Assigned Lease Premises, including as a result of any enforcement action taken by the relevant Landlord with respect to any breach by Seller of the relevant Assigned Lease in permitting Buyer to so occupy the relevant Assigned Lease Premises without obtaining the required consent.  Buyer shall not be entitled to make any claim or demand against, or obtain reimbursement from, Seller with respect to any costs, losses, claims, liabilities or damages incurred by Buyer as a consequence of being obliged to vacate an Assigned Lease Premises or in obtaining alternative premises, including any enforcement action which a Landlord may take against Buyer.

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(2)              whether or not Buyer occupies such Assigned Lease Premises as licensee as provided above, Buyer shall, effective as of the Closing Date, (A) pay Seller all rents, service charges, insurance premiums and other sums payable by Seller under the relevant Assigned Lease of the Assigned Lease Premises, (B) observe and perform all of Seller's covenants, obligations and conditions contained in the relevant Assigned Lease of the Assigned Lease Premises and (C) indemnify, defend, protect and hold harmless Seller from and against all losses, costs, claims, damages and liabilities arising on account of any breach thereof by Buyer.  Immediately upon receipt of the relevant Landlord's consent to the assignment of an Assigned Lease Premises, as set forth above, Buyer and Seller shall enter into a Real Property Lease Assignment with respect to such Assigned Lease Premises.

(iv)            If, despite the efforts of the parties as set forth above, a Landlord of an Assigned Lease Premises formally, unconditionally refuses to consent to the assignment of the applicable Assigned Lease:

(1)              Without limiting Seller's rights as set forth in subparagraphs (2) and (3) below, Seller may by written notice to Buyer elect to apply to the relevant Landlord for consent to sublease all of the relevant premises to Buyer for the remainder of the relevant Assigned Lease term at a rent equal to the rent from time to time under the relevant Assigned Lease, but otherwise on substantially the same terms and conditions as the relevant Assigned Lease and pursuant to the terms of a reasonable sublease form prepared by Seller.  If Seller makes such an election after the Closing Date (or before the Closing Date, if the Landlord consent is not received before the Closing Date), the provisions of Section 8.17(a)(iii) will apply, except, on the grant of the consent required to sublease the Assigned Lease Premises in question, Seller shall sublease to Buyer the relevant Assigned Lease Premises as set forth herein.  If Seller makes such an election before the Closing Date and the relevant Assigned Lease consent is obtained before the Closing Date, Seller shall sublease to Buyer the relevant Assigned Lease Premises on the Closing Date as set forth above.

(2)              If the Landlord formally, unconditionally refuses such consent prior to the Closing Date, Seller may elect by written notice to Buyer to delete the relevant Assigned Lease from the term "Assigned Leases" hereunder.  In such case, on the Closing Date, Seller shall not assign or sublease such premises to Buyer, and Buyer shall vacate the relevant premises.  Buyer shall not be entitled to make any claim or demand against or obtain reimbursement from Seller with respect to any costs, losses, claims, liabilities or damages incurred by Buyer as a consequence of being obliged to vacate the applicable premises or obtaining alternative premises.

(b)            Space-Sharing Arrangements.  Buyer and Seller agree to negotiate in good faith the space-sharing arrangements at those facilities to be shared by Buyer and Seller or their respective Subsidiaries following the Closing, which arrangements will be on commercial terms equivalent to those that could be obtained in reasonable arms length market transactions, and with respect to the sublease of the properties located at 201 and 301 Mentor Drive, Santa Barbara, California 93111, arrangements substantially on the terms set forth on Schedule 8.17(b).

(c)             Casualty.  Buyer and Seller shall grant and accept the leases, assignments, subleases or licenses of the premises as described in this Section 8.17, regardless of any casualty damage or other change in the condition of the applicable premises.  In addition, in the event that any Assigned Lease is terminated prior to the Closing Date, notwithstanding anything to the contrary in this Agreement, including Section 3.2, (a) Seller or its applicable Subsidiary shall not be required to assign such premises, (b) Buyer or its applicable Subsidiary shall not be required to accept an assignment of such premises and (c) neither party shall have any further liability with respect to such premises hereunder.

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8.18            Licensed Patent Schedule

Without limiting the definition of Licensed Patents set forth in Section 1.94, if prior to the fifth (5^th) anniversary of the Closing Date there is an inaccuracy with respect to Schedule 1.94 such that the representation set forth in Section 5.11 with respect to Licensed IPR was not true and correct as of the Closing Date, then, notwithstanding anything to the contrary set forth herein, as Buyer's sole and exclusive remedy with respect to the breach of the representation set forth in Section 0, on Buyer's written request, Seller shall add to such Patents as may be owned and licensable by Seller to Schedule 1.94 (and such Patents shall be deemed for all purposes as if such added Patents were on such Schedule as of the Closing Date).

8.19           Name Change

(a)              On or promptly after the Closing Date, Seller shall use its commercially reasonable efforts to cause a change of the following corporate names with the applicable Secretary of State in such a way as to allow Buyer to qualify and register to form a corporation under the following names: Mills Biopharmaceuticals and Selene (together, the "Transferred Names"), and shall execute and deliver all documents, certificates or other evidence required by the applicable Secretary of State to allow Buyer to reserve such name and establish entities with the applicable Secretary of State bearing such names.  On or promptly after the Closing Date, Seller shall use its commercially reasonable efforts to change the Transferred Names by filings with the applicable Secretary of State as reasonably requested by Buyer to give Buyer the same rights as Seller had to the Transferred Names immediately prior to the Closing.

(b)              On or promptly after the Closing Date, Buyer shall use its commercially reasonable efforts to cause a change of the corporate name of each Transferred Subsidiary that has "Mentor" as part of its corporate name with the applicable Governmental Authority in such a way so that "Mentor" is no longer part of the corporate name.

8.20            Business Permits

Beginning on the date hereof and ending 180 days following the Closing Date, Seller agrees that it shall (or, as applicable, cause its relevant Subsidiary to) use its commercially reasonable efforts to assist Buyer to effect the assignment, transfer or renewal of, or where applicable, re‑application for, the Business Permits.  Such assistance shall include cooperating with the gathering of information to be provided to the applicable Governmental Authority and responding to such other reasonable requests as are made by Buyer; provided, however, that Seller and its Subsidiaries shall not be required to incur any more than a nominal cost in providing such assistance and shall not be responsible for the payment of any Business Permit fees or related costs.

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8.21          Environmental Insurance

Buyer and Seller agree to cooperate in good faith to obtain, effective as of the Closing, the environmental insurance policies described on Schedule 8.21 naming Buyer and its relevant Subsidiaries as the named insureds and Seller and its relevant Subsidiaries as additional named insureds ("Environmental Insurance").  Buyer and Seller agree and acknowledge that Buyer and Seller shall equally bear the cost of the Environmental Insurance policy premium up to a total amount of $300,000, and Seller shall pay the full cost of any excess.  Buyer and Seller respectively shall complete any application and such other documents as are necessary to obtain the Environmental Insurance.  Buyer and Seller shall provide such additional information as may be required by the insurer following the date hereof.

8.22          Transition Services Agreement

From the date hereof until the Closing, Buyer and Seller agree to negotiate in good faith enhancements to the Transition Services Agreement that are mutually beneficial to both Parties.

8.23          Product Liability

Buyer hereby agrees to pay Seller $300,000 per year for a period of seven years, to be paid in equal amounts on a semi-annual basis with the first payment to occur on the six month anniversary of the Closing Date, in connection with Product Liability Claims that constitute Excluded Liabilities.  Buyer shall cooperate with Seller in Seller's defense of any Product Liability Claim that constitutes an Excluded Liability, and Seller shall have reasonable access to the books, records and personnel which are pertinent to the defense and which are in the possession or control of Buyer.  Seller shall cover the reasonable expenses of Buyer for such cooperation consistent with Seller's past practice.

8.24          Supply of SMEC Products; UK Marks

(a)             Each of the Parties shall use all reasonable efforts to negotiate binding definitive agreements with terms contained in the term sheet entered into among the Parties and Rochester Medical Corporation set forth in Schedule 8.24(a) and upon other commercially reasonable terms.

(b)             In the event that, as of the Closing Date, the Parties were unable to reach the binding definitive agreements described in Section 8.24(a), the Parties agree that, notwithstanding anything to the contrary contained herein (including in the Schedules):

(i)            the existing Male External Catheter ("MEC") supply arrangements to the extent pertaining to the supply of Transfix products from Seller to MML with respect to the UK will automatically terminate as of and subject to the Closing;

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(ii)           Buyer and Seller will enter into a new agreement for the supply by Seller and purchase by Buyer of Silicone Male External Catheters ("SMEC") products, currently manufactured by Seller in its manufacturing facility in Anoka, Minnesota (the "Anoka Facility"), for sale by Buyer worldwide other than in the UK, for five (5) years from the Closing Date;

(iii)          Buyer and Seller will continue the Existing Supply Agreement for distribution and sale of silicone and latex Male External Catheter products in the UK ("UK MEC Products") until its expiration;

(iv)          with respect to the new supply agreement referred to in clause (ii) above, (A) the terms of the supply agreement will be on commercially reasonable terms that are substantially similar (other than with respect to territory, price and product volumes) as that contained in the Existing Supply Agreement, (B) pricing under such supply agreement will be intended to cover only Seller's total fully burdened costs of supporting the manufacture and supply of such products to Buyer without realizing a profit therefrom and, accordingly, the price for such products charged by Seller to Buyer for such products will be all costs and expenses to support the manufacture and supply of such products, and (C) Buyer shall provide Seller with certain manufacturing support functions and services;

(v)           the Existing Supply Agreement shall be assignable to a third party in connection with Buyer's sale of Buyer's UK MEC Business (excluding MECs developed independently by Buyer);

(vi)          during the term of the new supply agreement described in clause (ii) above, Seller will not transfer the manufacturing capacity (other than as a part of a Change of Control of Seller) of the Anoka Facility without the consent of Buyer, which shall not be unreasonably withheld, delayed or conditioned (it being understood that it will be unreasonable to withhold consent if the transferee is capable of continuing the supply agreements referred to in clauses (ii) and (iii) above and agrees to honor such agreements);

(vii)         Seller's obligations in Section 8.16 (Non-competition) will be deemed hereby to be amended to provide that the developing, manufacturing, marketing, selling or distributing of SMECs (only) manufactured in the Anoka Facility shall not be considered a "Competing Business" or otherwise violate the covenants contained therein;

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(viii)            Seller shall (A) retain ownership of all rights in the UK in the CLEAR ADVANTAGE Mark, the FREEDOM CATH Mark, the FREEDOM PLUS Mark, the TRANSFIX Mark and the UK registration of the TRANSFIX Mark (UK Reg. No. 2,201,911) (and the associated goodwill) (collectively, the "Retained MEC Marks") and (B) receive from Buyer, and Buyer shall grant to Seller, after the expiration or other termination of the Existing Supply Agreement, a paid up, royalty free, perpetual, transferable, irrevocable, exclusive (including as to Buyer) trademark license to use the FREEDOM Mark (including with respect to any registration thereof) in the UK (the "Licensed MEC Mark" and, collectively with the Retained MEC Marks, the "UK MEC Marks") in connection with all UK MEC Products.  Buyer shall continue to maintain the exclusive sales, marketing and distribution rights to the UK MEC Marks for use with the UK MEC Products pursuant to the Existing Supply Agreement for the remaining term of the Existing Supply Agreement.  At the expiration or other termination of the Existing Supply Agreement for any reason, Buyer's rights in and to the UK MEC Marks for use with UK MEC Products shall cease. The sale, distribution or other use of the UK MEC Marks in connection with UK MEC Products shall not be considered a "Competing Business" or otherwise violate the covenants contained in Section 8.16. If Seller retains ownership of the Retained MEC Marks pursuant to this paragraph, the Parties agree to amend the Schedules as appropriate to reflect Seller's retention thereof. 

(ix)            For the avoidance of doubt, there shall be no restrictions on Seller's right to use the UK MEC Marks retained by or licensed to Seller pursuant to Section Error! Reference source not found. in connection with the UK MEC business. Buyer acknowledges and agrees that Seller intends to sell the UK MEC business to a third party and that accordingly any rights in the UK MEC Marks retained by or licensed to Seller will be transferred to such purchaser of the UK MEC Business. 

(x)            Any allocation of rights in, and use of, the UK MEC Marks will be subject to all requirements of UK Law, including those Laws that pertain to the use of trademarks.

(c)                Notwithstanding anything to the contrary contained herein (including in the Schedules), Seller shall in any event retain all rights in the UK in the MENTOR CLEAR ADVANTAGE Mark and the UK registration of the MENTOR CLEAR ADVANTAGE Mark (UK Reg. No. 1,494,286) (and the associated goodwill) (collectively, the "MENTOR CLEAR ADVANTAGE Mark") and the MENTOR CLEAR ADVANTAGE Mark shall be deemed an Excluded Asset.  Following the Closing, Seller shall, and shall cause its Subsidiaries to, suspend the use of the MENTOR CLEAR ADVANTAGE Mark immediately following the Closing and in Seller's discretion either terminate the UK registration of the MENTOR CLEAR ADVANTAGE Mark or allow such registration to lapse when it comes up for renewal.  Notwithstanding the foregoing, if at the Closing Buyer does not purchase from Seller all products in inventory (if any) that bear the MENTOR CLEAR ADVANTAGE Mark, then following the Closing Seller shall be entitled to sell, transfer or otherwise dispose of those products that it retains.  In addition, following the Closing, Seller agrees that it will not take any action to enforce its rights under the MENTOR CLEAR ADVANTAGE Mark against Buyer and, if the transactions between the Parties and Rochester Medical Corporation contemplated by Section 8.24(a) are consummated, Rochester Medical Corporation.

8.25          Escrow Agreement

The Parties agree to negotiate in good faith the terms of an escrow agreement (the "Escrow Agreement") that, together with this Agreement, will govern the Escrow Fund.

8.26          Porges Asset Sale

The Parties will effect the Porges Asset Sale in accordance with the terms of this Agreement, provided that the closing of the Porges Asset Sale will take place one day prior to the Closing Date.

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8.27          ABISS

As promptly as practicable following the execution hereof, Seller agrees to work in good faith to obtain the consent of Analytical Biosurgical Solutions ("ABISS") to the assignment to Buyer of that certain Exclusive Supply Agreement dated as of January 31, 2005, between Seller, Porges and ABISS (the "ABISS Agreement"), to the extent such consent is required to effect the assignment thereof.  In the event such consent to assignment is required and Seller is unable to either obtain the consent of ABISS or provide the benefits of the ABISS Agreement to Buyer as contemplated by Section 8.1, Seller will: (i) use its commercially reasonable efforts to find a substitute manufacturer that agrees, and is ready, willing and able, to deliver substantially similar services to Buyer as are provided by ABISS to Seller as of the Closing Date pursuant to the terms of the ABISS Agreement, and (ii) indemnify and hold harmless Buyer in accordance with the provisions of Article 11 hereof (including Section 11.6, but without regard to the limitation on recovery for consequential damages provided for in Section 11.5 and Section 13.11, which shall not apply in such event) for any Losses arising out of Seller's failure to obtain such consent or provide such benefits that are incurred by Buyer during the period from the Closing Date through the earliest of (A) the date Seller is able to obtain such consent, (B) the date Seller is able to provide such benefits and (C) the date Buyer or Seller finds a substitute manufacturer pursuant to clause (i) above.

8.28          Intercompany Contracts and Balances

At or before the Closing, Seller will, and will cause each of its Subsidiaries to, terminate all intercompany Contracts, receivables and payables between (i) Seller and its Retained Subsidiaries (as defined below), or any of them, on the one hand, and (ii) the Transferred Subsidiaries (other than Mentor Development Limited Partnership), or any of them, on the other hand, except in each case for amounts payable to or receivable from (x) the Retained Subsidiaries, or any of them, on the one hand and (y) the Transferred Subsidiaries (other than Mentor Development Limited Partnership), or any of them, on the other hand.  "Retained Subsidiaries" means all Subsidiaries of Seller other than the Transferred Subsidiaries. 

Article 9

CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE

All obligations of Buyer to effect the Closing hereunder are subject to the satisfaction at or prior to the Closing of the conditions precedent that follow, any one or more of which may be waived in writing, in whole or in part, exclusively by Buyer in its sole discretion:

9.1              Seller Closing Deliverables

Seller shall have made all the deliveries required to be made by Seller pursuant to Section 3.2.

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9.2              Performance

Seller and/or its Subsidiaries shall have performed and complied in all material respects with each of the agreements, covenants and conditions contained in this Agreement that are required to be performed or complied with by Seller and/or its Subsidiaries at or prior to the Closing.

9.3              Regulatory Approvals

All Governmental Actions pursuant to HSR and those set forth on Schedule 9.3, shall have been obtained and shall remain in full force and effect and all statutory waiting periods in respect thereof shall have expired.

9.4              No Injunction or Restraints; Illegality

No provision of any applicable Law (other than the UK OFT Undertakings) shall have been enacted, entered, promulgated or enforced by any Governmental Authority that prohibits, restrains, enjoins, or restricts the consummation of the transactions contemplated hereby in any material respect and no litigation or proceeding shall be pending by any Governmental Authority seeking to prohibit, restrain, enjoin or restrict the consummation of the transactions contemplated hereby in any material respect which would reasonably be expected to succeed.

9.5              Officer's Certificate

(a)               Buyer shall have received at the Closing, with respect to Seller, a certificate, dated as of the Closing Date, of an appropriate officer of Seller certifying that the conditions set forth in Sections 9.2, 9.6 and 9.7 have been satisfied.

9.6              Representations and Warranties

The representations and warranties set forth in Article 5 shall be true and correct (without giving effect to any qualification as to materiality or Seller Material Adverse Effect contained in any specific representation or warranty) on the Offer Date and as of the Closing Date as though such representations and warranties were made on and as of the Closing Date (provided that those representations and warranties which address matters only as of a particular date shall have been true and correct only on such date), except as would not, individually, or in the aggregate, constitute or be reasonably likely to constitute a Seller Material Adverse Effect.

9.7              No Seller Material Adverse Effect

There shall not have occurred and be continuing a Seller Material Adverse Effect.

9.8              Transition Services Agreement

The Parties shall have executed and delivered the Transition Services Agreement.

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Article 10

CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS TO CLOSE

All obligations of Seller to effect the Closing hereunder are subject to the satisfaction at or prior to the Closing of the conditions precedent that follow, any one or more of which may be waived in writing, in whole or in part, exclusively by Seller:

10.1          Buyer Closing Deliverables

Buyer shall have made all the deliveries required to be made by Buyer pursuant to Section 3.3.

10.2          Performance

Buyer and/or its Subsidiaries shall have performed and complied in all material respects with each of the agreements, covenants and conditions contained in this Agreement that are required to be performed or complied with by Buyer and/or its Subsidiaries at or prior to the Closing.

10.3          Regulatory Approvals

All Governmental Actions pursuant to HSR and those set forth on Schedule 9.3, including those in jurisdictions outside the United States, shall have been obtained and shall remain in full force and effect and all statutory waiting periods in respect thereof shall have expired.

10.4          No Injunction or Restraints; Illegality

No provision of any applicable Law shall have been enacted, entered, promulgated or enforced by any Governmental Authority that prohibits, restrains, enjoins, or restricts the consummation of the Transfer in any material respect and no litigation or proceeding shall be pending by any Governmental Authority seeking to prohibit, restrain, enjoin or restrict the consummation of the Transfer in any material respect which would reasonably be expected to succeed.

10.5          Officer's Certificate

Seller shall have received at the Closing, with respect to Buyer, a certificate signed by an appropriate officer of Buyer dated the Closing Date certifying that the conditions set forth in Sections 10.2, 10.6 and 10.8 have been satisfied.

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10.6          Representations and Warranties

The representations and warranties set forth in Article 6 shall be true and correct (without giving effect to any qualification as to materiality or Buyer Material Adverse Effect contained in any specific representation or warranty) on the Offer Date and as of the Closing Date as though such representations and warranties were made on and as of the Closing Date (provided that those representations and warranties which address matters only as of a particular date shall have been true and correct only on such date), except as does not, individually, or in the aggregate, constitute or would reasonably be likely to constitute a Buyer Material Adverse Effect.

10.7          Sufficient Funds

Buyer shall have sufficient funds to pay the Purchase Price.

10.8          No Buyer Material Adverse Effect

There shall not have occurred and be continuing a Buyer Material Adverse Effect.

10.9          UK OFT Undertakings

The UK OFT shall not have decided that the UK OFT Undertakings prevent or delay the consummation of the transactions contemplated by this Agreement.

Article 11

INDEMNITY

11.1          Survival

The representations and warranties of the Parties set forth in this Agreement or in any instrument delivered pursuant hereto shall survive for 18 months after the Closing Date; provided, however, that (i) the representations and warranties of Seller set forth in Section 5.20 (Products Liability) shall survive for 12 months after the Closing Date, and (ii) the representations and warranties of Seller set forth in Section 5.1 (Organization and Authority (other than the last sentence of Section 5.1(a) and the last sentence of Section 0 concerning qualification of as a foreign corporation), Section 5.2 (Transferred Subsidiaries, Capitalization), Section 5.5 (No Broker), the first sentence of Section 5.15(c) (Title to Real Property) and Section 5.25 (Sufficiency) (such representations and warranties in this clause (ii), collectively, the "Structural Representations") and the representations and warranties of Buyer set forth in Section 6.1 (Organization of Buyer), Section 6.2 (Authorization) and Section 6.6 (No Broker) shall survive until the tenth (10^th) anniversary of the Closing Date; provi ded further that the foregoing time limitation shall not apply to any claim for which a good faith written notice meeting the requirements set forth in Section 11.4(a) has been delivered prior to such date.  All covenants that by their terms are to be performed after the Closing shall survive the Closing.

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11.2          Buyer Indemnification

Subject to the limitations set forth in this Article 11, and as otherwise expressly set forth herein, Buyer hereby agrees to indemnify Seller, Seller's Affiliates and the Seller Representatives (the "Seller Indemnified Parties"), against and agrees to hold the Seller Indemnified Parties harmless from any Loss incurred or suffered by the Seller Indemnified Parties arising out of or related to (a) a Warranty Breach by Buyer (provided that, in the event of any such breach or inaccuracy, for purposes of determining the amount of any Loss no effect will be given to any qualification as to "material," "materiality," "material adverse effect" or a "Buyer Material Adverse Effect" contained therein), (b) a Covenant Breach by Buyer, (c) the Assumed Liabilities, or (d) any (formal or informal) investigation or inquiry by the UK Competition Authorities in relation to the UK OFT Undertakings to the extent that any such investigation or inquiry prevents or delays the consummation of the transactions contemplated by this Agreement.

11.3          Seller Indemnification

(a)             Subject to the limitations set forth in this Article 11, and as otherwise expressly set forth herein, Seller hereby agrees to indemnify Buyer and Buyer's Subsidiaries, and their respective Affiliates, officers, directors, agents, representatives, successors, assigns, partners and employees (the "Buyer Indemnified Parties") against and agrees to hold the Buyer Indemnified Parties harmless from any Loss incurred or suffered by the Buyer Indemnified Parties arising out of or related to (i) a Warranty Breach by Seller (provided that, in the event of any such breach or inaccuracy, for purposes of determining the amount of any Loss no effect will be given to any qualification as to "material," "materiality," "material adverse effect" or a "Seller Material Adverse Effect" contained therein); (ii) a Covenant Breach by Seller; (iii) the Excluded Liabilities; (iv) any failure to comply with Laws relating to bulk transfers that are applicable to the sale of the Transferred Assets; (v) Seller's Special Environmental Indemnity pursuant to Section 0; or (vi) the matters identified on Schedule 11.3(a).

(b)             Notwithstanding anything herein to the contrary, Seller shall have no Liability with respect to indemnification under this Agreement due to a Warranty Breach until the aggregate amount of Qualifying Losses (as defined below) incurred by the Buyer Indemnified Parties exceeds $1,000,000 (the "Threshold"), in which case the Buyer Indemnified Parties shall be entitled to seek compensation for all such Qualifying Losses.  A Loss shall not be a "Qualifying Loss" eligible to be counted toward the Threshold unless such Loss, standing alone or in the aggregate with other Losses for substantially similar matters (over any time period during the survival period of the relevant representations and warranties), equals or exceeds $100,000, in which case it shall be counted from the first dollar.  Notwithstanding the foregoing, any claims for a Warranty Breach with respect to Structural Representations shall not be subject to the foregoing Threshold and Qualifying Loss limitations.

(c)              Notwithstanding anything herein to the contrary, in no event shall Seller be liable for indemnification under this Agreement (i) for any Losses due to Warranty Breaches (other than with respect to Structural Representations), pursuant to this Article 11 or otherwise, for any amounts, individually or in the aggregate, in excess of 15% of the Purchase Price or (ii) for any Losses due to Warranty Breaches relating to Structural Representations, pursuant to this Article 11 or otherwise, for any amounts, individually or in the aggregate, which, when taken together with amounts paid for Losses with respect to Warranty Breaches pursuant to clause (i), exceed the Purchase Price.

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(d)              Seller shall indemnify the Buyer Indemnified Parties for Seller's Special Environmental Indemnity.  The term "Seller's Special Environmental Indemnity" shall mean the following:

(i)               Minneapolis, Minnesota.  Seller shall indemnify the Buyer Indemnified Parties for Losses incurred with respect to Environmental Claims arising out of Environmental Conditions existing as of the Closing in the soil and/or groundwater on, or migrating on or before the Closing from, the Transferred Real Property or the real property that is leased pursuant to the Assigned Leases located in Minneapolis, Minnesota including those described in that certain Phase I Environmental Site Assessment - Mentor Corporation, 1401, 1499, 1525, 1601 and 1615 West River Road North, Minneapolis, Minnesota ("Minneapolis Property"), prepared by GaiaTech and dated February 2006 ("Minneapolis Environmental Losses"), on the following terms and conditions:

(1)               The Minneapolis Environmental Losses must originate from a third Person claim including any claim of a Governmental Authority (i.e. other than a direct claim brought by any Buyer Indemnified Party) ("Minneapolis Claim").

(2)               Buyer and its Subsidiaries agree not to voluntarily perform or permit to be performed any soil or groundwater testing of any kind or nature on the Minneapolis Property unless required by a Governmental Authority pursuant to Environmental Laws.  If such voluntary testing is performed except as permitted in the previous sentence, the indemnity obligations of Seller in this Section 11.3(d)(i) shall be null and void and of no further force and effect.

(3)               Seller shall only be required to indemnify for any Minneapolis Environmental Losses suffered by any of the Buyer Indemnified Parties to the extent such Losses are incurred as a result of a requirement of a Governmental Authority pursuant to Environmental Laws or, in the event of a claim by any other third Person, to the extent it is reasonable and necessary to incur such Losses pursuant to Environmental Laws.

(4)               Losses covered under this Section 11.3(d)(i) shall not include diminution in property value of the Minneapolis Property.

(5)               Notwithstanding anything to the contrary in this Agreement, the Minneapolis Environmental Losses shall only include those Losses arising under a Minneapolis Claim that has been made on or before that date which is five (5) years following the Closing Date.

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(ii)              Other Business Properties.  Seller shall indemnify the Buyer Indemnified Parties for one half of all Losses (other than Seller Caused Environmental Losses, which are addressed in Section 11.3(d)(iii) below) incurred with respect to Environmental Claims arising out of Environmental Conditions existing as of the Closing in the soil and/or groundwater on, or migrating on or before the Closing from or to, all properties owned, leased or occupied as of the date hereof by Seller or any of Seller's Subsidiaries in connection with the Business, excluding the Minneapolis Property covered in Section 11.3(d)(i) above ("Other Business Property" with the Losses in this Section 0 referred to as "Other Business Property Environmental Losses"), on the following terms and conditions:

(1)             The Other Business Property Environmental Losses must originate from a third Person claim including any claim of a Governmental Authority (i.e. other than a direct claim brought by any Buyer Indemnified Party) ("Other Business Property Environmental Claim").

(2)            Buyer and its Subsidiaries agree not to voluntarily perform or permit to be performed any soil or groundwater testing of any kind or nature on the Other Business Property, except: (i) as required by a Governmental Authority pursuant to Environmental Laws; or (ii) with respect to the Real Property located at Avenue Edmond Rostand, Lieu-Dit Le Pontet, Sarlat-La-Caneda, France as further described in that certain Phase I Environmental Site Assessment prepared by GaiaTech dated February 2006 (the "Sarlat Property"), which testing occurs after the first anniversary of the Closing Date and then only at the request of a potential buyer in connection with a bona fide proposed sale of the Sarlat Property.  If such voluntary testing is performed, except as permitted in the previous sentence, the indemnity obligations of Seller in this Section 0 shall be null and void and of no further force and effect as to each particular legal parcel of Real Property upon which such testing was performed. 

(3)             Seller shall only be required to indemnify for any Other Business Property Environmental Losses suffered by any of the Buyer Indemnified Parties to the extent such Losses are incurred as a result of a requirement of a Governmental Authority pursuant to Environmental Laws or, in the event of a claim by any other third Person, to the extent it is reasonable and necessary to incur such Losses pursuant to Environmental Laws.

(4)             Losses covered under this Section 0 shall not include diminution in property value of the relevant Other Business Property.

(5)             Notwithstanding anything to the contrary in this Agreement, the Other Business Property Environmental Losses shall only include those Losses arising under an Other Business Property Environmental Claim that has been made on or before that date which is four (4) years following the Closing Date.

(iii)            Except as set forth in Sections 11.3(d)(i) and 0 above, Seller shall indemnify the Buyer Indemnified Parties for all Losses incurred with respect to Environmental Claims arising out of Environmental Conditions existing as of the Closing in the soil and/or groundwater on, or migrating on or before the Closing from, all properties owned, leased or occupied at any time by Seller or any of Seller's Subsidiaries in connection with the Business to the extent caused by Seller or any Subsidiary of Seller ("Seller Caused Environmental Losses"), on the following terms and conditions:

(1)             The Seller Caused Environmental Losses must originate from a third Person claim including any claim of a Governmental Authority (i.e. other than a direct claim brought by any Buyer Indemnified Party) ("Seller Caused Environmental Claim").

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(2)               The Seller Caused Environmental Losses can not arise as a result of soil or groundwater testing of any kind or nature that has been performed or permitted to be performed by Buyer or any Subsidiary of Buyer except as required by a Governmental Authority pursuant to Environmental Laws.  If such voluntary testing is performed, except as permitted in the previous sentence, the indemnity obligations of Seller in this Section 11.3(d)(iii) shall be null and void and of no further force and effect as to each particular legal parcel of Real Property upon which such testing was performed.

(3)               Seller shall only be required to indemnify for any Seller Caused Environmental Losses suffered by any of the Buyer Indemnified Parties to the extent such Losses are incurred as a result of a requirement of a Governmental Authority pursuant to Environmental Laws or, in the event of a claim by any other third Person, to the extent it is reasonable and necessary to incur such Losses pursuant to Environmental Laws.

(4)               Losses covered under this Section 11.3(d)(iii) shall not include diminution in property value of the Real Property.

(5)               The Buyer shall bear the burden of proof that the relevant Environmental Condition constitutes Seller Caused Environmental Losses.

(6)               Notwithstanding anything to the contrary in this Agreement, the Seller Caused Environmental Losses shall only include those Losses arising under a Seller Caused Environmental Claim that has been made on or before that date which is four (4) years following the Closing Date.

(iv)              Buyer hereby confirms that it has no present intention to perform any voluntary soil or groundwater testing of any kind or nature at any of the properties to be covered by the Environmental Insurance.

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11.4            Procedures

Each Party agrees to give prompt written notice (such Party with the obligation to give notice, the "Indemnified Party") to the other Party (the "Indemnifying Party") of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under this Agreement, including the estimated amount and other details of such claim; provided, however, that the failure of the Indemnified Party to so notify the Indemnifying Party shall not relieve the Indemnifying Party of its indemnification obligations hereunder, except to the extent that the Indemnifying Party shall have been materially prejudiced by such lack of timely and adequate notice.  The Indemnifying Party shall have the right, at its election, to take over the defense or settlement of any third Person claim at its own Expense by giving prompt notice to that effect to the Indemnified Party; provided, however, that the Indemnifying Party shall keep the Indemnified Party reasonably informed of the progress of such third Person claim.  If the Indemnifying Party shall have so assumed the defense of any claim, the Indemnifying Party shall be authorized to consent to a settlement of, or the entry of any judgment arising from, any such claim, in its sole discretion without the prior consent of the Indemnified Party; provided, however, that a condition to any such settlement shall be a complete release of the Indemnified Party with respect to such claim.  The Indemnifying Party agrees to consult with the Indemnified Party prior to entering into any settlement contemplated by the immediately preceding sentence, it being expressly understood that such duty to consult does not in any way limit the Indemnifying Party's right to consent to a settlement or the entry of judgment in its sole discretion without obtaining the prior consent of the Indemnified Party.  The Indemnified Party shall at all times have the right, at its option and Expense, to participate fully in, but not to control, any such defense.  If the Indemnifying Party, within 20 days after receipt of the Indemnified Party's notice of claim, does not (i) give such notice to take over the defense of such claim and proceed diligently to defend the claim or (ii) object to such claim in writing to the Indemnified Party, then the Indemnified Party shall have the right, but not the obligation, to undertake the defense of such claim for the account of and at the risk of the Indemnifying Party.  The Parties shall cooperate in defending any third Person claim, and the defending party shall have reasonable access to the books, records and personnel which are pertinent to the defense and which are in the possession or control of the other party.  The Parties agree that any Indemnified Party, at its own expense, may join an Indemnifying Party in any action, claim or proceeding brought by a third Person, as to which any right of indemnity created by this Agreement would or might apply, for the purpose of enforcing any right of indemnity granted to such Indemnified Party pursuant to this Agreement.

(a)                Any claim for indemnification made directly by a Party and which does not result from a third Person claim or action, shall be asserted by written notice.  The Indemnifying Party shall have a period of 45 days within which to respond thereto.  If the Indemnifying Party does not respond within such 45‑day period, such Party shall be deemed to have accepted responsibility to make payment and shall have no further right to contest the validity of such claim. 

(b)               Notwithstanding anything to the contrary, (i) no investigation by or knowledge of Buyer shall affect or limit Buyer's rights to indemnity contained in this Article 11, and (ii) Buyer's inability to recover for Losses under Section 11.3(a)(i) (whether due to the scope of a particular representation or warranty or otherwise) shall not preclude Buyer from recovering under any other subsection of Section 11.3(a), each such subsection being an independent basis for indemnification.

(c)                The Parties acknowledge that the provisions of Section 13.7 and that the same applies to all indemnity claims hereunder

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11.5          Limitation on Recovery

With respect to any Losses for which indemnification is sought pursuant to Section 11.3, the Seller shall not be liable, except in the case of fraud, for any Losses relating to any matter to the extent that a specific liability or reserve relating to the matter was taken into account in the calculation of Net Working Capital as reflected in the Final Net Working Capital Statement. With respect to any Losses for which indemnification is sought pursuant to Section 11.2 or Section 11.3, the Indemnifying Party shall not be liable, except in the case of fraud, for any special, consequential or punitive damages, including loss of profits or goodwill, except (i) to the extent a Governmental Authority has required, or a third party settlement has provided (to the extent the Indemnifying Party has consented to the settlement and the amounts payable thereof, which consent shall not be unreasonably withheld), such amounts to be paid to a third Person or (ii) with respect to consequential damages, as provided in Section 8.27.

11.6          Duty to Mitigate

(a)             Each Indemnified Party shall use its commercially reasonable efforts to mitigate Losses for which indemnification may be sought pursuant to Section 11.2 or Section 11.3, including (i) using its commercially reasonable efforts to secure payment from insurance policies available and in existence (including the Environmental Insurance) that provide coverage with respect to such Losses (an "Insurance Payment") and (ii) using its commercially reasonable efforts to secure reimbursement, indemnity or other payment from any third Person obligated by Contract or otherwise to reimburse, indemnify or pay the Indemnified Party with respect to such Loss (a "Third Party Payment" and, together with an Insurance Payment, a "Mitigation Payment"), it being understood and agreed that the Indemnified Party shall not be required to exhaust or conclude its remedies with respect to such Mitigation Payments prior to seeking indemnification from the Indemnifying Party under Section 11.2 or Section 11.3, as the case may be.  Notwithstanding anything to the contrary contained herein, the recovery by an Indemnified Party from any Indemnifying Party pursuant to Section 11.2 or Section 11.3, as the case may be, shall not relieve the Indemnified Party of its obligation to mitigate Losses pursuant to this Section 11.6(a).

(b)            Any amounts payable by an Indemnifying Party with respect to a particular Loss pursuant to Section 11.2 or Section 11.3, as the case may be, shall be reduced by the amount of Mitigation Payment, if any, received by the Indemnified Party with respect to such Loss prior to payment therefor by the Indemnifying Party.  In the event an Indemnifying Party makes a payment with respect to a particular Loss pursuant to Section 11.2 or Section 11.3, as the case may be, and thereafter the Indemnified Party receives a Mitigation Payment with respect to such Loss, the Indemnified Party shall reimburse the Indemnifying Party an amount equal to the lesser of (i) the Mitigation Payment and (ii) the amount so paid by the Indemnifying Party.

(c)             The Parties agree to treat indemnification payments as an adjustment to the Purchase Price.

(d)             The Parties acknowledge and agree that a Party's reporting to a Governmental Authority under a good faith belief of a duty to report under applicable Law does not violate the Party's duty to mitigate.

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11.7           Escrow Fund

At the Closing, the Escrow Amount shall be deposited by Buyer with the Escrow Agent, such deposit to constitute an escrow fund (the "Escrow Fund") and to be governed by the terms set forth herein and in the Escrow Agreement.  The Escrow Fund shall be available as security for the indemnification obligations of Seller for any Warranty Breach pursuant to Section 11.3(a)(i).  Buyer shall pay all fees and expenses of the Escrow Agent in connection with the administration of the Escrow Fund.

11.8          Indemnity is the Exclusive Remedy

Each Party acknowledges and agrees that after the Closing Date, absent fraud, its sole and exclusive remedy with respect to any and all claims relating to or arising out of any representation, warranty, covenant or agreement made by the other Party (or its Subsidiaries) in the Operative Agreements shall be pursuant to the indemnification provisions of this Article 11; provided, however, that in the event of any Warranty Breach arising under Section 5.25 (Sufficiency), Seller may, in its sole discretion and in lieu of payment of money damages, cure such breach by delivering or otherwise conveying sufficient rights to the asset or assets in question giving rise to such Warranty Breach; provided further that to the extent any provision in this Agreement (other than this Article 11) or any other Operative Agreement expressly creates an indemnity obligation in one of the Parties, the provisions of this Article 11 will apply to such provision to the extent not inconsistent therewith.  However, nothing set forth in this Agreement shall be deemed to prohibit or limit either Party's right at any time before, on or after the Closing Date, to seek injunctive or other equitable relief for the failure of the other Party to perform any covenant or agreement contained in any Operative Agreement, and the pursuit of injunctive relief shall not affect, modify or diminish in any way a Party's right to monetary relief in arbitration pursuant to Section 0.

11.9          Assignment of Claims

If an Indemnified Party receives any payment from an Indemnifying Party in respect of any Loss pursuant to Section 11.2 or Section 11.3 and the Indemnified Party could reasonably have recovered all or a part of such Loss from a third Person (a "Potential Contributor") based on the underlying claim asserted against the Indemnifying Party, the Indemnified Party shall assign such of its rights to proceed against the Potential Contributor but only to the extent necessary to permit the Indemnifying Party to recover from the Potential Contributor the amount of such payment.

11.10       No Set‑Off

Neither Party may set‑off Losses against other payments to be made by the respective Party pursuant to this Agreement or any other Operative Agreement without the written consent of the other Party.

Article 12

TERMINATION

12.1          Term

Unless terminated pursuant to Section 0 or as otherwise expressly set forth herein, this Agreement shall continue in full force and effect until full and final performance of all of the terms herein.

12.2          Termination

Anything contained in this Agreement to the contrary notwithstanding, this Agreement may be terminated at any time prior to the Closing Date:

86

(a)             by the mutual signed written consent of Buyer and Seller;

(b)             by either Party if:

(i)              a Law is in effect having the effect of permanently restraining, enjoining or otherwise prohibiting, in a material respect, the consummation of the transactions contemplated by this Agreement, which Law is final and nonappealable (and for the avoidance of doubt, the Buyer shall have no right to terminate this Agreement pursuant to this Section 12.2(b)(i) by reason of the fact that it is in breach of the UK OFT Undertakings); or

(ii)             the Closing shall not have occurred on or before the End Date; provided, however, that the failure of the Closing to occur is not due to a material breach hereof by the Party seeking termination;

(c)             by Buyer:

(i)              in the event of a Warranty Breach or Covenant Breach by Seller such that the conditions set forth in Section 9.6 or Section 9.2, as applicable, would not be satisfied; provided, however, that Seller is given notice to cure such breach and does not cure such breach within 60 days after receipt of notice from Buyer requesting such breach be cured; or

(ii)             if a Seller Material Adverse Effect shall have occurred since the date hereof; or

(d)             by Seller:

(i)               if a Buyer Material Adverse Effect shall have occurred since the date hereof; or

(ii)             in the event of a Warranty Breach or Covenant Breach by Buyer such that the conditions set forth in Section 10.6 or Section 10.2, as applicable, would not be satisfied; provided, however, that Buyer is given notice to cure such breach and does not cure such breach within 60 days after receipt of notice from Seller requesting such breach be cured.

12.3          Notice of Termination

Any Party desiring to terminate this Agreement pursuant to Section 0 shall give written notice of such termination to the other Party.

12.4          Effect of Termination

In the event that this Agreement shall be validly terminated pursuant to this Article 12, this Agreement shall forthwith terminate and be of no further force and effect; provided, however, that (a) any agreements contained herein that expressly provide for survival after termination of this Agreement and Section 8.15 and Article 13 shall survive the termination hereof, and (b) nothing herein shall relieve any Party from liability for any willful breach of this Agreement or fraud arising prior to such valid termination.  Termination of this Agreement shall not limit the Liability of any Party except as otherwise expressly provided in this Agreement.

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Article 13

GENERAL PROVISIONS

13.1          Notices

(a)            Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be delivered in person, transmitted by facsimile (with acknowledgment of complete transmission together with notice by telephone (either to a person or by voice mail message) to the confirmatory telephone numbers below, provided that such confirmatory telephone numbers shall allow for voice mail messages to be left 24 hours per day, seven days per week) or sent by registered or certified mail, or recognized overnight courier, charges prepaid, addressed as follows:

(i)              if to Seller:

Mentor Corporation

201 Mentor Drive

Santa Barbara, California 94311

Attention: Chief Executive Officer, with a copy to the General Counsel

Facsimile No.:  (805) 879-6008

Phone: (805) 879-6000 (for confirmation purposes only)

with a copy to (which shall not constitute notice):

Wilson Sonsini Goodrich & Rosati

Professional Corporation

650 Page Mill Road

Palo Alto, CA 94304

Attention:          Bradley Finkelstein, Esq.

                        Martin Korman, Esq.

Facsimile No.:  (650) 493-6811

Phone: (650) 493-9300 (for confirmation purposes only)

(ii)            if to Buyer:

Coloplast A/S

Holtedam 1

3050 Humlebaek

Denmark

Attn: Peter Volkers

Facsimile No.:  011-45 (country code) -49-11-24-10

Phone: 011-45 (country code) -49-11-16-13 (for confirmation purposes only)

with a copy to (which shall not constitute notice):

Welch Spell, PC

Suite 1750

1170 Peachtree Street, N.E.

Atlanta, GA  30309

Attention: Laurance D. Pless, Esq.

                  Robert Sauro, Esq.

Facsimile No.:  (404) 875-0798

Phone: (404) 885-5229 (for confirmation purposes only)

88

(b)             Any such notice or other communication shall be deemed to have been given and received on the day on which it was personally delivered or transmitted by facsimile, receipt of complete transmission confirmed (or, if such day is not a Business Day, on the next following Business Day) or, if mailed, by registered or certified mail, on the third Business Day following the date of mailing or, if couriered overnight, on the next following Business Day; provided, however, that if at the time of mailing or within three Business Days thereafter, there is or occurs a labor dispute or other event that might reasonably be expected to disrupt the delivery of documents by mail, any notice or other communication hereunder shall be delivered or transmitted by means of overnight courier as set forth above.

(c)             Either Party may change its address for service and/or notice at any time by giving notice to the other Party in accordance with this Section 13.1.

13.2          Currency

Unless otherwise indicated, all dollar amounts referred to in this Agreement are expressed in United States dollars.

13.3          Sections and Headings

Unless otherwise specified herein, any reference in this Agreement to an Article, Section, paragraph, Schedule or Exhibit refers to the specified Article, Section or paragraph of, or Schedule or Exhibit to, this Agreement.  In this Agreement, the terms "this Agreement", "hereof", "herein", "hereunder" and similar expressions refer to this Agreement and not to any particular part, Article, Section, paragraph or other provision hereof.

13.4          Rules of Construction

Unless the context otherwise requires, in this Agreement:

(a)             words importing the singular number only shall include the plural and vice versa and words importing the masculine gender shall include the feminine and neuter genders and vice versa;

(b)            the word "or" may be conjunctive or disjunctive, as the context may require;

(c)             the words "include", "includes", "including" and "particularly" means "include", "includes" or "including", in each case, "without limitation";

(d)             reference to any agreement or other instrument referred to herein shall mean such agreement or other instrument as amended, modified, replaced or supplemented from time to time to the extent permitted by applicable provisions thereof and by this Agreement;

(e)              reference to any statute shall be deemed to be a reference to such statute as amended, re enacted or replaced from time to time;

(f)               if there is any conflict or inconsistency between the provisions contained in the body of this Agreement and those of any Schedule or Exhibit hereto, the provisions contained in the body of this Agreement shall prevail;

(g)              time periods within which a payment is to be made or any other action is to be taken hereunder shall be calculated excluding the day on which the period commences and including the day on which the period ends; and

(h)              whenever any payment to be made or action to be taken hereunder is required to be made or taken on a day other than a Business Day, such payment shall be made or action taken on the next following Business Day.

89

13.5           Construction

 The Parties acknowledge that their respective legal counsel have reviewed and participated in settling the terms of this Agreement and that any rule of construction to the effect that any ambiguity is to be resolved against the drafting party, shall not be applicable in the interpretation of this Agreement.

13.6          Entire Agreement

This Agreement, together with the agreements specifically contemplated herein or entered into or delivered in connection herewith, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, written and oral, with respect to the subject matter hereof (including the Offer Letter and the Exclusivity Agreement but excluding the Confidentiality Agreement).  There are no conditions, covenants, agreements, representations, warranties or other provisions, express or implied, collateral, statutory or otherwise, relating to the subject matter hereof except as herein provided or as provided in other documents executed and delivered by the Parties in connection herewith.

13.7          Governing Law; Jurisdiction and Venue; Arbitration of Indemnification Disputes; Injunctive Relief

(a)            This Agreement shall be governed by, and construed in accordance with, the Laws of the State of Minnesota, without regard to any conflicts of law principles.  The parties hereto irrevocably submit to the exclusive jurisdiction of the United States District Court located in Minneapolis, Minnesota for the purposes of any suit, action or other proceeding arising out of this Agreement or any transaction contemplated hereby (except for claims, disputes or controversies arising out of or relating to Article 11 (including all its subsections), which shall be governed by subsection (b) below).  Each of the parties hereto, further agrees that service of any process, summons, notice or document by U.S. registered mail to such party's respective address set forth in Section 13.1 shall be effective service of process for any action, suit or proceeding in Minneapolis, Minnesota with respect to any matters to which it has submitted to jurisdiction as set forth above in the immediately preceding sentence.  Each of the parties hereto irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding set forth above arising out of this Agreement or the transactions contemplated hereby, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.

90

(b)            Any claims, disputes or controversies arising out of or relating to Article 11 (including all its subsections), including any dispute concerning arbitrability or the scope of this arbitration clause, shall be exclusively settled by binding arbitration pursuant to the Commercial Rules ("Rules") of the American Arbitration Association ("AAA") (it being expressly understood and agreed that any such claims, disputes and remedies shall be subject to the provisions of Article 11, including but not limited to Section 11.8 thereof).  Notwithstanding anything to the contrary, arbitration may be commenced at any time following the expiration of the last counternotice period provided in subsection (b) above by any Party hereto in Minneapolis, Minnesota, by giving written notice to AAA in such place, and to each other Party, that such claim or dispute has been referred to arbitration under this Section 0.  The arbitration proceedings shall be conducted, using Minnesota law, and applicable federal law, before a single neutral arbitrator (or, in the case of a claim exceeding One Million Five Hundred Thousand Dollars ($1,500,000), before a panel of three (3) neutral arbitrators), each of whom shall have experience with mergers and acquisitions.  Any award rendered by the arbitrator(s) shall be conclusive, final and binding upon the Parties hereto, and nonappealable to any court or forum; provided, however, that any such award shall be accompanied by a concise written opinion giving the reasons for the award.  Judgment upon such award may be entered in any court of competent jurisdiction.  Each Party shall pay its own expenses of arbitration. 

13.8          Waiver of Jury Trial

Each Party hereby waives, to the fullest extent permitted by applicable Laws, any right it may have to a trial by jury with respect to any litigation directly or indirectly arising out of, under or in connection with this Agreement, the other Operative Agreements or the transactions contemplated hereby or thereby.  Each Party hereby (a) certifies that no representative, agent or counsel of the other Party has represented, expressly or otherwise, that the other Party would not, in the event of litigation, seek to enforce the foregoing waiver, and (b) acknowledges that it and the other Party have been induced to enter into the Operative Agreements by, among other things, the mutual waivers and certifications contained in this Section 13.8.

13.9          Public Announcement

The Parties shall consult with each other before issuing any press release or making any other public announcement with respect to this Agreement or the transactions contemplated hereby and, except as required by any applicable Laws, regulatory requirement or the rules of any national or foreign stock exchange upon which their respective securities are listed for trading, neither of them shall issue any such press release or make any such public announcement without the prior written consent of the other, which consent shall not be unreasonably withheld, delayed or conditioned.

13.10        Expenses

Except as otherwise provided herein, each Party shall be responsible for all expenses incurred by it and its Subsidiaries (it being understood that effective upon the Closing, the Transferred Subsidiaries shall become Subsidiaries of Buyer), respectively, in connection with the negotiation and settlement of this Agreement and the Operative Agreements and the completion of the transactions contemplated hereby and thereby.

13.11       Exclusion of Certain Damages

EXCEPT AS SPECIFICALLY SET FORTH IN SECTION 11.5 OR IN THE CASE OF FRAUD, NEITHER BUYER (INCLUDING BUYER'S SUBSIDIARIES) NOR SELLER (INCLUDING SELLER'S SUBSIDIARIES) SHALL BE RESPONSIBLE FOR ANY SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES WHATSOEVER, INCLUDING LOSS OF PROFITS OR GOODWILL, IN CONNECTION WITH ANY ASPECT OF THIS AGREEMENT OR THE OTHER OPERATIVE AGREEMENTS.

91

13.12       Severability

If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such determination shall not impair or affect the validity, legality or enforceability of the remaining provisions hereof, and each provision is hereby declared to be separate, severable and distinct.  To the extent that any such provision is found to be invalid, illegal or unenforceable, the Parties shall act in good faith to substitute for such provision, to the extent possible and as necessary, a new provision with content and purpose as close as possible to the provision so determined to be invalid, illegal or unenforceable.

13.13      Successors and Assigns

This Agreement shall inure to the benefit of and shall be binding on and enforceable by the Parties and their respective successors and permitted assigns.  Neither Party may assign any of its rights or obligations hereunder, by operation of law or otherwise, without the prior written consent of the other Party, which consent shall not be unreasonably withheld, delayed or conditioned; provided, however, that Buyer may assign or delegate its rights, obligations or liabilities under this Agreement in whole or in part to one or more Subsidiaries of Buyer without the consent of Seller if and so long as Buyer shall remain fully liable for the fulfillment of all such obligations; provided, further, that Seller may assign any of its rights or obligations under this Agreement in connection with a transfer or sale of all or substantially all of Seller's assets provided that the assignee agrees to be bound by the terms and provisions of this Agreement.  Buyer and Buyer Subsidiaries shall have the right without consent of Seller to assign their rights under this Agreement and the other Operative Agreements as collateral to their respective lenders after reasonable prior notice to the other Party.  Any purported assignment in violation of this Section 13.13 shall be void and no assignment by Buyer or Seller to a Subsidiary thereof will relieve Buyer or Seller from any of their respective obligations hereunder.  Nothing herein expressed or implied is intended or should be construed to confer upon or give to any Person other than the parties hereto and their representatives, successors and assigns any rights or remedies under or by reason of this Agreement.

13.14      Amendment and Waivers

No amendment, modification or waiver of, or supplement to, any provision of this Agreement shall be binding on any Party unless consented to in writing by such Party.  No waiver of any provision of this Agreement shall constitute a waiver of any other provision, and no waiver shall constitute a continuing waiver unless otherwise provided.

13.15      Counterparts

This Agreement may be executed in counterparts, each of which shall constitute an original and all of which taken together shall constitute one and the same instrument.

IN WITNESS WHEREOF, each of Buyer and Seller has caused this Agreement to be executed by its duly authorized representative as of the date and year first written above.

MENTOR CORPORATION                                                                       COLOPLAST A/S

By:                                                                                                                    By:                                                                      

Print name:                                                                                                       Print name:                                                           

Title:                                                                                                                 Title:                                                                     

92

PURCHASE AGREEMENT

by and between

MENTOR CORPORATION

and

COLOPLAST A/S

dated ____________ __, 2006

EX-2

EXHIBIT 2.3

TABLE OF CONTENTS
		Page
Article 1 DEFINITIONS		1
Article 2 PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES		17
2.1	Transferred Assets; Transferred IPR	17
2.2	Assumed Liabilities	17
2.3	Conveyances	17
2.4	Net Working Capital Adjustment	18
2.5	No Withholding	18
Article 3 CLOSING		19
3.1	The Closing	19
3.2	Deliveries by Seller	19
3.3	Deliveries by Buyer	20
Article 4 INTELLECTUAL PROPERTY LICENSES		20
4.1	Licensed IPR	20
4.2	License‑Back Patents	21
4.3	Limitations	21
4.4	License-Back Other IPR	21
4.5	Reservation of Rights	21
4.6	Trade Secret Protection and Use	21
4.7	Transfer	21
4.8	Products Outside of Licensed Field and License-Back Field	22
4.9	Bulking Agent and/or Toxin	22
4.1	Exclusive Patent	22
4.11	License to Transition Marks	22
Article 5 REPRESENTATIONS AND WARRANTIES OF SELLER		23
5.1	Organization and Authority	23
5.2	Transferred Subsidiaries; Capitalization	23
5.3	No Violation	24
5.4	Compliance with Laws; Business Permits	24
5.5	No Broker	24
5.6	Absence of Changes	24
5.7	Contracts	26
5.8	Taxes	26
5.9	Transferred Tangible Assets	27
5.1	Transferred Contracts; Subsidiary Contracts	27
5.11	Intellectual Property	27
5.12	Financial Statements and Reports	28
5.13	Benefit Plan Compliance	29
5.14	Labor Matters	30
5.15	Properties	31
5.16	Environmental Matters	31
5.17	Transferred Inventory	32
5.18	Accounts Receivable	32
5.19	Litigation	32
5.2	Products Liability	32
5.21	Customers and Suppliers	33

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TABLE OF CONTENTS
(Continued)
		Page
5.22	Compliance With Health Care Laws	33
5.23	FDA and Global Regulation Compliance	33
5.24	Restrictions on Business Activities	35
5.25	Sufficiency	35
5.26	Exclusive Warranties	35
5.27	Insurance	35
5.28	Compliance with Conduct of Business Covenant	35
Article 6 REPRESENTATIONS AND WARRANTIES OF BUYER		35
6.1	Organization of Buyer	35
6.2	Authorization	36
6.3	No Violation	36
6.4	Government Consents	36
6.5	Purchase for Investment; Accredited Investor	36
6.6	No Broker	36
6.7	Financing	37
6.8	Litigation	37
Article 7 EMPLOYEE TRANSFERS AND BENEFITS		37
7.1	Voluntary Transfer Employees	37
7.2	Automatic Transfer	38
7.3	Compensation and Benefits	39
7.4	Information and Consultation	39
7.5	Severance	39
7.6	Employment‑Related Assumed Liabilities	40
7.7	Employment-Related Excluded Liabilities	40
7.8	Timing of Claims Incurred	40
7.9	Retention Payment	40
Article 8 ADDITIONAL COVENANTS		41
8.1	Contracts	41
8.2	Conduct of the Business	41
8.3	Access to Information	43
8.4	Books and Records	43
8.5	Necessary Efforts; HSR Filings	43
8.6	Taxes and Costs Relating to the Porges Asset Sale	44
8.7	Tax Matters	45
8.8	Allocation of Purchase Price	46
8.9	Return of Excluded Assets	46
8.1	Brokers	47
8.11	Further Assurances	47
8.12	Mail Handling	47
8.13	Non‑Solicitation	47
8.14	Pre-Closing Integration Planning	48
8.15	Confidentiality	48
8.16	Non-Competition	49
8.17	Real Estate Matters	49
8.18	Licensed Patent Schedule	51
8.19	Name Change	51

 

-ii-

TABLE OF CONTENTS
(Continued)
		Page
8.2	Business Permits	52
8.21	Environmental Insurance	52
8.22	Transition Services Agreement	52
8.23	Product Liability	52
8.24	Supply of SMEC Products	52
8.25	Escrow Agreement	54
8.26	Porges Asset Sale	54
8.27	ABISS	54
8.28	Intercompany Contracts and Balances	54
Article 9 CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE		55
9.1	Seller Closing Deliverables	55
9.2	Performance	55
9.3	Regulatory Approvals	55
9.4	No Injunction or Restraints; Illegality	55
9.5	Officer's Certificate	55
9.6	Representations and Warranties	55
9.7	No Seller Material Adverse Effect	56
9.8	Transition Services Agreement	56
Article 10 CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS TO CLOSE		56
10.1	Buyer Closing Deliverables	56
10.2	Performance	56
10.3	Regulatory Approvals	56
10.4	No Injunction or Restraints; Illegality	57
10.5	Officer's Certificate	57
10.6	Representations and Warranties	57
10.7	Sufficient Funds	57
10.8	No Buyer Material Adverse Effect	57
10.9	UK OFT Undertakings	57
Article 11 INDEMNITY		58
11.1	Survival	58
11.2	Buyer Indemnification	58
11.3	Seller Indemnification	61
11.4	Procedures	62
11.5	Limitation on Recovery	62
11.6	Duty to Mitigate	62
11.7	Escrow Fund	63
11.8	Indemnity is the Exclusive Remedy	63
11.9	Assignment of Claims	63
11.1	No Set‑Off	63
Article 12 TERMINATION		63
12.1	Term	63
12.2	Termination	63
12.3	Notice of Termination	64
12.4	Effect of Termination	64

-iii-

TABLE OF CONTENTS
(Continued)
		Page
Article 13 GENERAL PROVISIONS		65
13.1	Notices	65
13.2	Currency	66
13.3	Sections and Headings	66
13.4	Rules of Construction	66
13.5	Construction	67
13.6	Entire Agreement	67
13.7	Governing Law; Jurisdiction and Venue; Arbitration of Indemnification Disputes; Injunctive Relief	67
13.8	Waiver of Jury Trial	68
13.9	Public Announcement	68
13.1	Expenses	68
13.11	Exclusion of Certain Damages	68
13.12	Severability	68
13.13	Successors and Assigns	69
13.14	Amendment and Waivers	69
13.15	Counterparts	69

-iv-

INDEX OF EXHIBITS
Exhibit	Description
A	Form of Assignment and Assumption Agreement
B	Form of Bill of Sale
C	Transition Services Agreement
D	Balance Sheet and Net Working Capital Spreadsheet
E-1	Form of Patent Assignment
E-2	Form of Trademark Assignment
F	Preliminary Purchase Price Allocation
INDEX OF SCHEDULES
Schedule	Description
Schedule 1.6	Assumed Liabilities
Schedule 1.59	Excluded Assets
Schedule 1.60	Excluded Liabilities
Schedule 1.79	Infrastructure Assets
Schedule 1.84(a)	Individuals (Knowledge)
Schedule 1.84(b)	Individuals (Knowledge)
Schedule 1.94	Licensed Patents
Schedule 1.104	Net Working Capital
Schedule 1.115	Permitted Encumbrances - U.S. Real Property
Schedule 1.125(a)	Products (Existing)
Schedule 1.125(b)	Products (Under Development)
Schedule 1.161	Subsidiary Real Property
Schedule 1.166	Third Party Licenses
Schedule 1.173	Transferred Contracts
Schedule 1.174	Transferred Copyrights
Schedule 1.178	Transferred Internet Properties
Schedule 1.181(a)	Transferred Marks
Schedule 1.181(b)	Non-Transferred Marks
Schedule 1.182	Transferred Patents
Schedule 1.183	Transferred Real Property
Schedule 1.184	Transferred Subsidiaries
Schedule 1.186	Transferred Tangible Assets
Schedule 3.2(g)	Foreign Conveyance Jurisdictions
Schedule 3.2(m)	Released Encumbrances
Schedule 7.1(a)	Employees
Schedule 8.2(a)	Exceptions to Conducting Business in Ordinary Course
Schedule 8.2(b)	Exceptions to Taking of Prohibited Actions
Schedule 8.17(b)	Summary of Space-Sharing Terms -301 Mentor Drive
Schedule 8.21	Environmental Insurance
Schedule 9.3	Regulatory Approvals
Schedule 11.3(a)	Seller Indemnification Matters

-v-

THIS PURCHASE AGREEMENT (this "Agreement"), is entered into and made as of May 17, 2006, by and between Mentor Corporation, a Minnesota corporation ("Seller"), and Coloplast A/S, a Danish corporation ("Buyer") (Buyer and Seller may hereinafter be referred to individually as a "Party" and collectively as the "Parties").

WITNESSETH:

WHEREAS, Seller is engaged, directly and through Subsidiaries, in the Business (as defined below); and

WHEREAS, upon and subject to the terms and conditions set forth herein, Seller desires to sell to Buyer and Buyer desires to purchase from Seller, certain of the assets of Seller, including the Equity Interests (as defined below) of the Transferred Subsidiaries (as defined below), related to the Business (as defined below), and Seller desires to transfer to Buyer and Buyer desires to assume from Seller and the Transferred Subsidiaries, certain of the liabilities related to the Business;

WHEREAS, it is the intention and desire of Seller, by this Agreement, to divest itself of, and transfer to Buyer, or otherwise provide Buyer the benefit of, the Business and all rights thereof; and

WHEREAS, accordingly, Seller will, by the terms of this Agreement transfer, license or provide by means of services agreements, to Buyer Seller's tangible and intangible assets and rights used by Seller in the conduct of the Business and necessary for Buyer to conduct the Business following the Closing (as defined below); and

WHEREAS, concurrently with the execution hereof, Seller and Buyer are entering into a Transition Services Agreement (as defined below) that provides for integration planning and transition services with respect to the conveyance of the Business from Seller to Buyer as contemplated by the terms hereof.

NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises herein made, and in consideration of the covenants, representations, warranties, conditions and agreements herein contained, Buyer and Seller hereby agree as follows:

Article 1

DEFINITIONS

(i)            As used in this Agreement, the following terms shall have the meanings specified or referred to in this Article 1.

1.1                "AAA" has the meaning set forth in Section 13.7(b).

1.2                "Acquired Entity" has the meaning set forth in Section 8.16.

1.3                "Affiliate" means any entity which controls, is controlled by, or is under common control with, Seller or Buyer, as the case may be.  An entity shall be deemed to be in control of another entity only if, and for so long as, it owns or controls more than 50% of the voting power in the election of directors (or, in the case of an entity that is not a corporation, for the election of the corresponding managing authority) of such other entity.

1.4                "Agreement" has the meaning set forth in the first paragraph of this Agreement together with all schedules and exhibits attached hereto.

1.5                "Assigned Leases" has the meaning set forth in Section 5.15(a).

1.6                "Assumed Liabilities" means the Liabilities of Seller and its Subsidiaries identified on Schedule 1.6.

1.7                "Assumption Agreement" means an Assignment and Assumption Agreement in substantially the form set forth in Exhibit A (subject to substitution in certain cases by the Conveyance Documents pursuant to Section 2.3).

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1.8                "Automatic Transfer Employees" means those Employees of Transferred Subsidiaries whose Contracts of employment automatically transfer to Buyer (or a Subsidiary thereof) in accordance with applicable Laws in connection with the transactions contemplated by this Agreement.

1.9                "Bills of Sale" means Bills of Sale in substantially the form set forth in Exhibit B (subject to substitution in certain cases by the Conveyance Documents pursuant to Section 2.3).

1.10            "Business" means the surgical urology and consumer and clinical healthcare operating segments of Seller, whether conducted by Seller or its Subsidiaries, and consisting of the following diversified product portfolio of surgical and non-surgical products, that provide solutions for a broad range of urological problems:

(a)           the catheter products and operations, selling the following products for the management of bladder control and urinary retention: (i) the Self-Cath® brand line of intermittent catheters both with and without the Self-Cath HydroGel™, (ii) the Freedom® brand line of latex and latex free male external catheters, and (iii) catheter accessories, including leg bags, deodorizers and moisturizers;

(b)           the disposable urology products and operations, selling the following products for both hospital and outpatient settings for the management of urinary tract obstruction, urinary incontinence, or urinary retention: (i) urethral stents and catheters, dilators and guidewires, (ii) stone extractors, (iii) prostatic catheters and prostatic stents, (iv) urethral stents, (v) bladder drainage catheters, (vi) Foley catheters, (vii) bladder injection needles (currently under development), and (viii) general surgical devices including Elephants/Easivac;

(c)           clinical or consumer ostomy care products;

(d)           the women's health products and operations, selling the following surgically implantable products for the treatment of incontinence and pelvic organ prolapse: (i) synthetic slings for the surgical treatment of stress urinary incontinence under the brand Aris™, (ii) tissue-based slings and grafts for the surgical treatment of pelvic organ prolapse under the brands Axis™ and Suspend®, (iii) pelvic floor synthetic mesh systems for the treatment of cystocele and rectocele pelvic organ prolapse, (iv) minimally invasive office-based endometrial ablation product called Selene® for the treatment of excessive menstrual bleeding, and (v) the soon to be released NovaSilk™ synthetic mesh for treatment of pelvic organ prolapse;

(e)           the men's health products and operations, selling the following surgically implanted penile implants for the treatment of erectile dysfunction: (i) the Titan® three-piece inflatable penile implant, (ii) the Genesis™ one-piece malleable penile implant, (iii) One-Touch Pump development project to enhance the Titan, (iv) Excel® two-piece implant product, development efforts and operations, and (v) testicular implants; and

(f)            the brachytherapy products and operations, consisting of the following radioisotope products and loading products, supplies and systems  for the treatment of prostate cancer: (i) the Iodine-I-125 radio isotope brachytherapy seed, (ii) the Palladium-PD-103 radio isotope brachytherapy seed, (iii) Isoloader® all-in-one workstation automated needle loading, seed assay and reporting, and (iv) IsoStrand® automated stranding device. 

1.11            "Business Competitor" means that part of any Person engaged, directly or indirectly, in a Competing Business.

1.12            "Business Day" means a day, other than Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by Law to close.

1.13            "Business Permits" has the meaning set forth in Section 5.4.

1.14            "Buyer" has the meaning set forth in the first paragraph of this Agreement.

1.15            "Buyer Benefits Plans" means the Employee Benefits Plans of Buyer (or a Subsidiary thereof), as amended from time to time, under which some or all of the Employees will be eligible to participate following the Closing.

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1.16            "Buyer Indemnified Parties" has the meaning set forth in Section 11.3(a).

1.17            "Buyer Employment Liabilities" has the meaning set forth in Section 7.6.

1.18            "Buyer Material Adverse Effect" means any change that is materially adverse to the net assets or financial condition of Buyer and its Subsidiaries taken as a whole or to the ability of Buyer to consummate the transactions contemplated hereby or any agreements delivered or entered into in connection herewith.  For the avoidance of doubt, "Buyer Material Adverse Effect" does not include any requirement by Buyer to divest, license, hold separate (through the establishment of a trust or otherwise) or otherwise dispose, or agree to dispose, of assets as, or if, required to avoid or overcome the objections of the UK Competition Authorities to the transactions contemplated by this Agreement or to comply with the UK OFT Undertakings.

1.19            "Buyer Subsidiaries" has the meaning set forth in Section 2.3.

1.20            "Cause" means (a) a Transferred Employee's breach of any trade secret or any confidential information agreement with Buyer (or a Subsidiary thereof), or written policy of Buyer or a Subsidiary thereof, (b) willful misconduct by a Transferred Employee, which is determined in good faith by Buyer to be injurious to the business of Buyer, (c) the conviction of, or entry of a guilty plea by, a Transferred Employee for the commitment of, a crime of moral turpitude (d) substance abuse including alcohol, (e) repeated and documented neglect of duty, (f) taking an action for the purpose of harming the Buyer or its business, (g) noncompliance with applicable Law in a manner that is injurious to the business of Buyer, (h) fraud or intentional misrepresentation, (i) continual, significant absenteeism, or (j) in any pertinent jurisdiction outside the United States, any action giving grounds for dismissal under applicable Laws, as applied to any Employee of a Transferred Subsidiary. 

1.21            "Change of Control" means, with respect to a Party, a transaction or series of related transactions that would directly or indirectly: (a) result in or have the effect of a third Person obtaining legal or beneficial ownership of more than 50% of the voting shares (or other voting interests) of such Party (even if such Party is the surviving entity, such as in the case of a reverse triangular merger); or (b) result in the sale, transfer, assignment, exclusive license or other disposition of all or substantially all of the Party's assets; other than, in the case of (a), a transaction pursuant to which the shareholders of such Party immediately prior to the relevant transaction continue to beneficially own at least 50% of the voting shares (or other voting interests) of such Party or its direct or indirect parent entity immediately following such transaction.

1.22            "Closing" has the meaning set forth in Section 3.1.

1.23            "Closing Date" has the meaning set forth in Section 3.1.

1.24            "Closing Date Balance Sheet" has the meaning set forth in Section 2.4(a).

1.25            "Closing Date Net Working Capital Statement" has the meaning set forth in Section 2.4(a).

1.26            "Closing Statements" has the meaning set forth in Section 2.4(a).

1.27            "Code" means the Internal Revenue Code of 1986, as amended.

1.28            "Competing Business" means (1) the developing, manufacturing, marketing, selling, importing or distributing any or all of the following products: (a) surgically implantable substances, prostheses or other devices for the treatment of male impotence or erectile dysfunction; (b) substances, prostheses or other devices to replace or simulate the testicle; (c) clinical or consumer healthcare products for the management of urinary retention or incontinence, including external or internal catheters and adult incontinence diapers (but not baby diapers); (d) clinical or consumer ostomy care products; (e) surgically implantable (i) substances, (ii) prostheses or (iii) other devices, for the treatment of kidney or ureter stones, kidney or urethral obstructions, urinary retention or incontinence, or pelvic organ prolapse; (f) devices or methods to instill substances or devices in the uterus for the purpose of treating excessive endometrial bleeding; and (g) brachytherapy products, devices or substances for use or application in the Licensed Field, and/or (2) the wholesale or retail service of providing any or all of the above products to consumers or healthcare providers.  Notwithstanding the foregoing, however, a "Competing Business" shall not include: (1) the developing, manufacturing, marketing, selling, importing or distributing of (A) any oral pharmaceuticals or (B) any product or treatments involving dermal fillers or other bulking agents or toxins, including botulinum toxins, for any indication or application, including any urologic indication or application; or (2) any business(es) acquired (and thereafter operated) by Seller or its Affiliates for so long as such business(es) generate(s) less than $5,000,000 in aggregate annual revenues from any Competing Business.

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1.29            "Confidentiality Agreement" means that certain agreement between Citigroup Global Markets Inc., on behalf of Seller, and Buyer dated October 27, 2005. 

1.30            "Consensual Transfers" has the meaning set forth in Section 5.10(a).

1.31            "Consent" has the meaning set forth in Section 8.5(a).

1.32            "Constructive Termination" shall mean only a resignation of an Employee's employment within forty-five (45) days after the occurrence of any of the following events: (i) a material reduction in the Employee's responsibilities, provided that a change of title shall not constitute such a material reduction; (ii) a reduction in the Employee's base salary, other than a one-time reduction that applies to substantially all other employees of Buyer; or (iii) a relocation of the Employee's principal office to a location more than fifty (50) miles from the location of the Employee's principal office prior to such relocation in any case when the terms of employment made to the Employee by Buyer did not indicate that the Eligible Employee would be relocated to a principal office outside such fifty (50) mile radius; and provided in all the above cases the Buyer has failed to cure the facts and circumstances giving rise to the Constructive Termination within fifteen (15) days after receipt of notice of such resignation.

1.33            "Contracts" means all contracts, binding agreements, options, leases, licenses, sales, binding commitments and other similar instruments, whether oral or written.

1.34            "Conveyance Documents" has the meaning set forth in Section 2.3.

1.35            "Copyrights" has the meaning set forth in Section 1.81.

1.36            "Covenant Breach" means with respect to a Party, a breach of, nonfulfillment or failure to comply with a covenant or agreement made or to be performed pursuant to this Agreement or any other Operative Agreement by such Party or a Subsidiary thereof.

1.37            "CPA Firm" has the meaning set forth in Section 2.4(c).

1.38            "Disclosure Letter" has the meaning set forth in the introduction to Article 5.

1.39            "DOJ" has the meaning set forth in Section 8.5(c).

1.40            "Downward Adjustment Amount" has the meaning set forth in Section 2.4(d).

1.41            "Effect" has the meaning set forth in Section 1.151.

1.42            "Eligible Employee" has the meaning set forth in Section 7.9.

1.43            "Employee Benefits Plan" means, and whether written or oral: (a) any plan, fund, agreement or program which provides health, medical, surgical, hospital, vision or dental care or other welfare benefits, or benefits in the event of sickness, accident or disability, or death benefits, apprenticeship or other training programs, or day care centers, scholarship funds, or prepaid legal services; (b) any plan, fund, agreement or program which provides retirement income to Employees or results in a deferral of income by Employees for periods extending to the termination of covered employment or beyond; (c) any plan, fund, agreement, practice or program which provides severance, unemployment, vacation or fringe benefits (including dependent and health care accounts); (d) any incentive compensation plan, deferred compensation plan, stock option or stock‑based incentive or compensation plan, or stock purchase plan; (e) any other "employee pension benefit plan" (as defined in Section 3(2) of ERISA), any other "employee welfare benefit plan" (as defined in Section 3(1) of ERISA); and (f) any other written or oral plan, agreement or arrangement involving direct or indirect compensation including insurance coverage, severance benefits, disability benefits, fringe benefits, pension or retirement plans, profit sharing, deferred compensation, bonuses (including any sale bonuses), stock options, stock purchase, phantom stock, stock appreciation or other forms of incentive compensation or post‑retirement compensation, as well as any change in control agreements, managing director agreements and other retention arrangements.

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1.44            "Employees" means those individuals who are employed by (a) a Transferred Subsidiary, or (b) Seller or a Subsidiary thereof and who are primarily engaged in or dedicated to the Business and, in both cases (a) and (b) to be listed on Schedule 7.1(a) (as may be updated by Seller as of or prior to the Closing, subject to the consent of Buyer (such consent not to be unreasonably withheld, delayed or conditioned), to reflect as of the Closing Date those Employees who are primarily engaged in or dedicated to the Business).

1.45            "Encumbrance" means any lien, claim, charge, license, security interest, mortgage, pledge, easement, conditional sale or other title retention agreement, defect in title, covenant or other restrictions of any kind, other than a Permitted Encumbrance.

1.46            "End Date" means July 31, 2006 (or such later date as may be mutually agreed to by the Parties); provided, however, that if on or prior to July 31, 2006 (or such later date), Buyer has notified Seller that a Covenant Breach and/or a Warranty Breach has occurred with respect to Seller, then the End Date shall be automatically extended for such number of days as is necessary to provide Seller the full 60-day period to cure such breach from the date of notice pursuant to Section 12.2(c).

1.47            "Enforceability Exceptions" has the meaning contained in Section 5.1(c).

1.48            "Environmental Claim" means any actual or threatened complaint, judgment, demand, legal action, administrative proceeding, lien, order, directive, claim, citation or assessment made, presented, sought or alleged by any Person and that (i) arises out of events, acts or conditions existing on or prior to the Closing, (ii) relates to the Business or the Transferred Assets or the use, ownership or operation thereof, and (iii) arises under any Environmental Law.  Environmental Claims include any and all (x) enforcement, clean-up, Response Actions or other governmental regulatory actions initiated, completed, pending or threatened, (y) claims made, threatened or prosecuted by any third party, and (z) proceedings for the recovery of any damages, indemnification, contribution, cost recovery, compensation, Losses or injury, including personal injury.

1.49            "Environmental Condition" means any Hazardous Substance that is present on or prior to the Closing in, under, on or about any real property used for the Business or otherwise comprising any of the Transferred Real Property and that (i) requires any Response Action pursuant to any Environmental Law, or (ii) constitutes an endangerment of health, safety, property or the environment pursuant to any Environmental Law, including the presence or Release, or threatened Release, of any Hazardous Substances into, on or under the air, soil, surface water, groundwater or other media.

1.50            "Environmental Laws" means any and all Laws anywhere in the world relating to worker health, safety, exposure of any individual to a Hazardous Substance or pollution or protection of the environment, including those relating to emissions, discharges, spills or other releases or threatened releases into or impacting the environment or natural resources (including ambient air, surface water, groundwater or land), or otherwise relating to the manufacture, processing, distribution, use, treatment, recycling, storage, disposal, transport, sale, offer for sale, distribution or handling of Hazardous Substances, including the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §§ 9601 et seq. ("CERCLA"), the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et seq., and the Occupational Safety and Health Act, 29 U.S.C. §§ 651 et seq., any amendments or successor statutes to any of the foregoing, and the rules, regulation, permits orders and decrees implementing the same and all analogous state and local laws, rules regulations, permits, orders and decrees. 

1.51            "Environmental Permits" means those Business Permits required to be held pursuant to Environmental Laws.

1.52            "Equity Interest" means capital stock, membership interests, options, warrants, stock appreciation rights, or rights to subscribe for, calls or other instruments exercisable for, or convertible into, the capital stock, membership interests or similar equity interests of any Person.

1.53            "ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder.

1.54            "ERISA Affiliate" means any employer that is, or at any time for which any relevant statute of limitations remains open, was, together with Seller, treated as a "single employer" under section 414(b), section 414(c) or section 414(m) of the Code.

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1.55            "Escrow Agent" means Nordea Bank Finland plc.

1.56            "Escrow Agreement" has the meaning set forth in Section 8.25.

1.57            "Escrow Amount" means an amount equal to $10,000,000.

1.58            "Escrow Fund" has the meaning set forth in Section 11.7.

1.59            "Excluded Assets" means the assets of Seller and its Subsidiaries and Affiliates that are not Transferred Assets, including those assets identified on Schedule 1.59.

1.60            "Excluded Liabilities" means any and all Liabilities of Seller and its Subsidiaries and Affiliates other than the Assumed Liabilities, including those Liabilities identified on Schedule 1.60.

1.61            "Exclusivity Agreement" means that certain letter agreement between Seller and Buyer dated March 27, 2006, relating to the transactions contemplated hereby.

1.62            "Existing Supply Agreement" means that certain Agreement between Seller, SSL International Plc and Buyer dated September 29, 2001, (novation to Distribution Agreement between Seller and SSL International Plc dated September 1, 2001).

1.63            "Expenses" means any and all reasonable expenses actually incurred in connection with investigating, defending or asserting any claim, action, suit or proceeding incident to any matter expressly indemnified against hereunder (including court filing fees, court costs, arbitration fees or costs, witness fees, and statutory or other reasonable and actual fees and disbursements of legal counsel, investigators, expert witnesses, consultants, accountants and other professionals).

1.64            "FDA" has the meaning set forth in Section 5.23(a).

1.65            "Final Balance Sheet" has the meaning set forth in Section 2.4(c).

1.66            "Final Net Working Capital Statement" has the meaning set forth in Section 2.4(c).

1.67            "Financial Statements" has the meaning set forth in Section 5.12.

1.68            "Foreign Benefit Plans" has the meaning set forth in Section 5.13(b)(i).

1.69            "FTC" has the meaning set forth in Section 8.5(c).

1.70            "GAAP" means Generally Accepted Accounting Principles as established and understood under accounting standards in the United States of America.

1.71            "Governmental Actions" means any authorizations, consents, approvals, waivers, exceptions, variances, franchises, permissions, permits, and licenses of, and filings, notifications or  declarations with, any Governmental Authority worldwide, including the United States, the European Union, Canada, Australia and Japan.

1.72            "Governmental Authority" means any national, supranational, local or foreign court, governmental or administrative agency or commission or other governmental agency, authority, instrumentality, notified body, competent authority, third party governmental designate or regulatory body having appropriate jurisdiction worldwide.

1.73            "Hazardous Substances" means any material, substance, chemical or emission designated by any Governmental Authority as "toxic", "hazardous", "extremely hazardous", a "pollutant" or "contaminant" or words of similar import pursuant to Environmental Laws, including petroleum, waste or asbestos.

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1.71            "Governmental Actions" means any authorizations, consents, approvals, waivers, exceptions, variances, franchises, permissions, permits, and licenses of, and filings, notifications or  declarations with, any Governmental Authority worldwide, including the United States, the European Union, Canada, Australia and Japan.

1.72            "Governmental Authority" means any national, supranational, local or foreign court, governmental or administrative agency or commission or other governmental agency, authority, instrumentality, notified body, competent authority, third party governmental designate or regulatory body having appropriate jurisdiction worldwide.

1.73            "Hazardous Substances" means any material, substance, chemical or emission designated by any Governmental Authority as "toxic", "hazardous", "extremely hazardous", a "pollutant" or "contaminant" or words of similar import pursuant to Environmental Laws, including petroleum, waste or asbestos.

1.74            "Health Care Laws" has the meaning set forth in Section 5.22(c).

1.75            "HSR" means the Hart Scott Rodino Antitrust Improvements Act of 1976, as amended.

1.76            "Indemnified Party" has the meaning set forth in Section 11.4.

1.77            "Indemnifying Party" has the meaning set forth in Section 11.4.

1.78            "Industry‑Wide Plan" means any scheme, plan, fund or arrangement, which provides Retirement Benefits to or in respect of Automatic Transfer Employees in which employers may participate even if they are not within the same corporate group as the other participating employers.

1.79            "Infrastructure Assets" means all assets and Technology that are used in, or are a part of, the general operation of Seller's (including its Subsidiaries) business and not exclusively related to the Business, including network or telecommunications software and equipment, accounting software, IT systems, desktop computer software, database software, and general software development or control systems, tools or environments and including those assets identified on Schedule 1.79.  Notwithstanding the foregoing, "Infrastructure Assets" exclude those items that are specifically listed in Schedule 1.186 as a Transferred Tangible Asset.

1.80            "Intellectual Property" or "IP" means Technology and Intellectual Property Rights in and to Technology.

1.81            "Intellectual Property Rights" or "IPR" means all rights associated with any of the following: (a) United States and foreign patents and applications  therefor, and including any patent or application that is a provisional application, reissue, re-examination, renewal, extension or continuation of a patent or patent application ("Patents"); (b) know-how, trade secret rights and all other rights in or to confidential business or technical information ("Trade Secrets"); (c) copyrights, copyright registrations and applications therefor and all other rights corresponding thereto throughout the world ("Copyrights"); (d) trademarks, service marks, logos, trade dress rights and similar designation of origin and rights therein, registrations and applications for registration therefor ("Marks"); (e) industrial design rights and any registrations and applications therefor; (f) URLs, WWW address, and domain names ("Internet Properties") (g) databases and data collections (including knowledge databases, customer lists and customer databases); and (h) any similar, corresponding or equivalent rights to any of the foregoing anywhere in the world.  Intellectual Property Rights specifically excludes contractual rights, including license grants, and the tangible embodiment of any of the foregoing.

1.82            "Interim Financials" has the meaning set forth in Section 5.12.

1.83            "IPR Assignment" has the meaning set forth in Section 3.2(c).

1.84            "Knowledge" means: (a) the knowledge of any of the individuals listed on Schedule 1.84 (a); or (b) the knowledge of any of the individuals on Schedule 1.84(b), provided that prior to the Offer Date the particular individual listed on Schedule 1.84(b) communicated the subject matter of such knowledge in writing to one or more superiors of such individual.

1.85            "Landlord" means a landlord, sublandlord, licensor or other party granting the right to use or occupy real property.

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1.86            "Laws" means any applicable laws, statutes, ordinances, regulations, rules, interpretations, or orders of any Governmental Authority anywhere in the world.

1.87            "Lease" means a lease, sublease, license or other agreement permitting the use or occupancy of real property.

1.88            "Liabilities" means any and all debts, liabilities, obligations and duties (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, whether latent or patent, whether determined or undetermined, and whether due or to become due).

1.89            "License-Back Field" means: (a) the field (other than the Licensed Field) covering the types of products (other than the Products) sold by Seller and/or its Subsidiaries as of the date hereof; and (b) the field of aesthetics medicine including breast augmentation and reconstruction, body contouring and facial rejuvenation, with products including, breast implants, mammary prostheses, breast expanders, extremity tissue expanders, liposuction and body contouring products, dermal fillers and other bulking agents, toxins, including botulinum toxins, and derivatives and improvements of the foregoing products together with the Technology related thereto, irrespective of whether such products were sold by Seller and/or its Subsidiaries as the date hereof.

1.90            "License-Back Other IPR" means the Transferred IPR (other than Transferred Patents, the Transferred Marks, the Transferred Internet Properties and those Transferred Copyrights listed on Schedule 1.174), to the extent used as of or prior to the Closing Date in Seller's business (other than exclusively in the Business) or embodied in a product of Seller (other than exclusively in the Products).

1.91            "License-Back Patents" means any Transferred Patents and any Patent filed by Buyer following the Closing that claims  priority from any Transferred Patents.

1.92            "Licensed Field" means the diagnosis, treatment or management of medical or surgical conditions, disorders or diseases relating to (a) the urinary tract or any part thereof (being from kidney to distal urethra), (b) prostate, (c) anorectal canal, rectum and distal colon, (d) pelvic floor, and (e) male or female reproductive organs and the uterus; provided, however, that the License Field shall not include the Licensed-Back Field or any treatment or use involving a toxin, including botulinum toxins, a dermal filler, or bulking agent. 

1.93            "Licensed Other IPR" means all Intellectual Property Rights (other than Transferred IPR, Patents and Marks) owned or licensable (without the consent of or material payment of any consideration to any third Person) by Seller or its Subsidiaries as of the Closing, that are used in, or reasonably necessary to the operation of, the Business in the Licensed Field as of the Closing. 

1.94            "Licensed Patents" means any Patent owned by Seller as of the Closing Date, which is either (i) a Patent issued as of the Closing Date or (ii) which issues following the Closing Date from a Patent application of Seller filed before the Closing Date, and which Patent would, absent the license granted in Section 4.1(a) hereof, be infringed as of the Closing by the operation of the Business or the Products in the Licensed Field, including the Patents identified on Schedule 1.94; provided, that the Licensed Patents shall not include any Patent directed to a toxin, including botulinum toxins, a dermal filler, a bulking agent or use thereof.

1.95            "Licensor Party" and "Licensee Party" have the respective meanings set forth in Section 4.3(a).

1.96            "Losses" means any and all losses, costs, obligations, Liabilities, settlement payments, awards, judgments, fines, penalties, damages, Expenses, deficiencies or other charges.

1.97            "Manages" (or "Management," as the context requires) means uses, possesses, generates, treats, manufactures, processes, handles, stores, recycles, transports, or disposes of Hazardous Substances.

1.98            "Marks" has the meaning set forth in Section 1.81.

1.99            "Minneapolis Claim" has the meaning set forth in Section 11.3(d)(i)(1).

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1.100         "Minneapolis Environmental Losses" has the meaning set forth in Section 11.3(d)(i).

1.101         "Minneapolis Property" has the meaning set forth in Section 11.3(d)(i).

1.102         "MML" shall mean Mentor Medical Limited.

1.103         "Most Recent Balance Sheet" has the meaning set forth in Section 5.12.

1.104         "Net Working Capital" has the meaning set forth in Schedule 1.104.

1.105         "Net Working Capital Target" means the Net Working Capital derived from the 2006 Year-End Balance Sheet (as defined in Section 5.12(a) of the Disclosure Letter) to be delivered by Seller to Buyer in accordance with Section 5.12(a) of the Disclosure Letter.  The Net Working Capital Target will be calculated on a consistent basis with, and in accordance with the principles set forth on, the illustrative Closing Date Net Working Capital Statement (assuming the Closing Date had occurred on December 31, 2005) attached hereto as Exhibit D. 

1.106         "Objection" has the meaning set forth in Section 2.4(b).

1.107         "Offer Date" means March 27, 2006.

1.108         "Offer Letter" means that certain binding offer letter dated March 27, 2006 from Buyer to Seller relating to the transactions contemplated hereby.

1.109         "Offered Employee" has the meaning set forth in Section 7.1(a).

1.110         "Operative Agreements" means this Agreement, the Assumption Agreement, the Bills of Sale, the Escrow Agreement, any Conveyance Documents, the IPR Assignment, the Transition Services Agreement and the Real Property Agreements and any other document or agreement to be executed and delivered by either of the Parties at the Closing.

1.111         "Other Business Property Environmental Claim" has the meaning set forth in Section 11.3(d)(ii)(1).

1.112         "Other Business Property" has the meaning set forth in Section 11.3(d)(ii).

1.113         "Other Business Property Environmental Losses" has the meaning set forth in Section 11.3(d)(ii).

1.114         "Patents" has the meaning set forth in Section 1.81.1.115         "Permitted Encumbrances" means any or all of the following (a) liens for taxes and other similar governmental charges and assessments which are not yet delinquent or liens for taxes being contested in good faith by any appropriate proceedings for which adequate reserves have been established, (b) liens of landlords and liens of carriers, warehousemen, mechanics and materialmen and other like liens arising in the ordinary course of business for sums not yet due and payable, (c) undetermined or inchoate liens, charges and privileges existing as of the Closing Date and any statutory liens, licenses, charges, adverse claims, security interests or encumbrances of any nature whatsoever existing as of the Closing Date and claimed or held by any Governmental Authority that have not at the time been filed or registered against title to the Transferred Assets or that are related to obligations that are not due or delinquent, (d) licenses or other non‑exclusive rights to any Transferred IPR granted prior to the date of this Agreement by Seller or any Affiliate thereof to any third Person, (e) restrictions on resale of securities imposed by applicable federal, state and foreign securities Laws, (f) security given in the ordinary course of business as of the Closing Date to any public utility, Governmental Authority or other statutory or public authority in connection with the Transferred Assets, (g) Encumbrances imposed on the underlying fee interest in the leased property, (h) with respect to U.S. properties, those Permitted Encumbrances listed on Schedule 1.115, and with respect to all Real Property all other Encumbrances of record that affect such Real Property and such encroachments or other state of facts which an inspection or survey of any Real Property would disclose and (i) other Encumbrances that do not materially impair the use of the Real Property by Seller in respect of the Business.

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1.116         "Person" means any individual, corporation, partnership, limited liability company, trust, unincorporated organization, association, firm, joint venture, joint stock company, Governmental Authority or other entity.

1.117         "Poor Performance" means the failure of a Transferred Employee to substantially perform his or her duties to Buyer, or a Subsidiary of Buyer, after having been provided written notice of such failure and 30 days to cure such failure.

1.118         "Porges" shall mean Porges S.A.S.

1.119         "Porges Asset Sale" shall mean the sale of all IPR (which, for purposes of this Section 1.119, shall be read to exclude clause (g) of the definition of IPR) owned by Porges to Buyer to be effected one day prior to the Closing Date pursuant to Section 8.26 hereof.

1.120         "Potential Contributor" has the meaning set forth in Section 11.9.

1.121         "Pre-Closing Taxes" has the meaning set forth in Section 8.7(a)(i).

1.122         "Pre‑Closing Tax Period" has the meaning set forth in Section 8.7(a)(i).

1.123         "Preliminary Purchase Price" means $456,137,500.

1.124         "Product Liability Claim" shall mean any civil action or claim for money damages brought by an individual recipient and user of product, or any derivative action or claim for money damages including loss of consortium and survival actions and claims, where such action or claim arises out of an alleged defect in design, manufacture, materials, testing, workmanship, or performance of such product, or any alleged failure to warn, or from any alleged breach of warranty, express or implied, or any alleged noncompliance with any applicable Laws, or any alleged negligence, with respect to such product.  A Product Liability Claim will be deemed to be "Made" on the first date a written notice is received by Seller or Buyer, as the case may be, asserting a Product Liability Claim that includes a claim for money damages other than a claim for reimbursement under an express written warranty for such product.  

1.125         "Products" means any and all products of the Business in the Licensed Field: (a) which are currently manufactured and/or sold or licensed by Seller and/or any of its Subsidiaries, including those identified on Schedule 1.125(a); (b) which are under development by Seller and/or its Subsidiaries, including those identified on Schedule 1.125(b); and (c) which were developed, manufactured, distributed, licensed and/or sold, as applicable, at any time before the Closing Date by or on behalf of Seller and/or its Subsidiaries. 

1.126         "Programs" has the meaning set forth in Section 5.22(a).

1.127         "Purchase Price" means the Preliminary Purchase Price, as adjusted pursuant to Section 2.4(d).

1.128         "Purchase Price Allocation" has the meaning set forth in Section 8.8.

1.129         "Real Property" has the meaning set forth in Section 5.15(a).

1.130         "Real Property Agreements" means the Real Property Lease Assignments.  Notwithstanding the foregoing, if the relevant Landlord consent to the assignment of an Assigned Lease has not been received prior to the Closing Date as set forth in Section 8.17(a) below, the Real Property Lease Assignment as to such premises shall not be considered Real Property Agreements for purposes of Section 3.2 and Section 3.3.

1.131         "Real Property Lease Assignments" has the meaning set forth in Section 8.17(a)(i).

1.132         "Recall" has the meaning set forth in Section 5.20(b).

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1.133         "Released" (or "Release," as the context requires) means released, spilled, leaked, discharged, disposed of, pumped, poured, emitted, emptied, injected, leached, or dumped Hazardous Substances.

1.134         "Remedial Action" has the meaning set forth in Section 8.5(b).

1.135         "Remediation" has the meaning set forth in Section 5.16(a).

1.136         "Response Action" means any action or activities of "response" as that term is defined in 42 U.S.C. § 9601(25), without regard to any limitation of that term (or terms included therein by reference) to "hazardous substances" as defined under CERCLA.

1.137         "Retirement Benefits" means any pension, lump sum, installment, annuity or similar benefit provided or to be provided on or after retirement (including early retirement), death or disability in respect of an Employee's employment, but excluding benefits provided under an arrangement, the sole purpose of which is to provide benefits on the accidental injury or death of a Transferred Employee.

1.138         "Returns" has the meaning set forth in Section 5.8(a).

1.139         "Rules" has the meaning set forth in Section 13.7(b).

1.140         "Schedules" means the schedules to this Agreement as of the Offer Date, except that Schedule 1.94 (Licensed Patents), Schedule 1.186 (Transferred Tangible Assets) and Schedule 7.1(a) (Employees) may be updated by the Seller prior to the Closing, subject to the consent of Buyer (such consent not to be unreasonably withheld, delayed or conditioned) to the extent contemplated by or otherwise provided for under this Agreement.

1.141         "SEC" means the Securities and Exchange Commission.

1.142         "Securities Act" has the meaning set forth in Section 5.2(c).

1.143         "Seller" has the meaning specified in the first paragraph of this Agreement.

1.144         "Seller Benefits Plans" means the Employee Benefits Plans of Seller (or a Subsidiary thereof) under which some or all of the Transferred Employees are eligible to participate immediately prior to the date of this Agreement.

1.145         "Seller Caused Environmental Claim" has the meaning set forth in Section 11.3(d)(iii)(1).

1.146         "Seller Caused Environmental Losses" has the meaning set forth in Section 11.3(d)(iii).

1.147         "Seller Domestic Benefit Plan" has the meaning set forth in Section 5.13(a)(i).

1.148         "Seller Employment Liabilities" has the meaning set forth in Section 7.7.

1.149         "Seller's Environmental Indemnification Obligations" means (i) Seller's obligation to indemnify the Buyer Indemnified Parties for any breach of the representations contained in Section 5.16 hereof to the extent required in (and subject to the other terms and conditions of) Article 11 hereof; and (ii) Seller's obligation to indemnify the Buyer Indemnified Parties for the Seller's Special Environmental Indemnity in Section 11.3(d) hereof to the extent required in (and subject to the other terms and conditions of) Article 11 hereof.

1.150         "Seller Indemnified Parties" has the meaning set forth in Section 11.2.

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1.151         "Seller Material Adverse Effect" means any change, event, state of facts, or effect (each an "Effect") that is materially adverse to the Business; provided, however, that none of the following shall be deemed, either alone or in combination, to constitute a Seller Material Adverse Effect: any Effect resulting from or arising out of (a) the announcement of this Agreement or the pendency of the transactions contemplated hereby, including actions taken in connection with the separation of the Business in furtherance of the transactions contemplated hereby, (b) the performance by a Party of its obligations under this Agreement or as required by applicable Laws or accounting requirements, (c) general economic conditions in any country where the Business is conducted that do not disproportionately and adversely affect the Business in any material respect, (d) general conditions in any industry in which the Business is conducted that do not disproportionately and adversely affect the Business in any material respect, (e) any natural disaster or any acts of terrorism, sabotage, military action or war (whether or not declared) or any escalation or worsening thereof, (f) any Environmental Condition existing on or before the Closing in the soil and/or groundwater on, or migrating on or before the Closing from, all properties owned, leased or occupied at any time by Seller or any of Seller's Subsidiaries in connection with the Business or (g) any Effect for which an adjustment to the Preliminary Purchase Price is required to be made pursuant to Section 2.4.

1.152         "Seller Representatives" means the directors, officers, employees, agents, investment bankers, attorneys, accountants and other advisors to, or representatives of, Seller and/or its Subsidiaries.

1.153         "Seller Retirement Plan" means each scheme, plan, fund or arrangement of Seller, whether written or oral, which provides Retirement Benefits to or, in respect of Automatic Transfer Employees (not including any mandatory state or social security plan or Industry‑Wide Plan in which any member of Seller participates for the benefit or, in respect of Automatic Transfer Employees).

1.154         "Seller's Special Environmental Indemnity" means the indemnity provided by Seller to the Buyer Indemnified Parties set forth in Section 11.3(d) hereof to the extent required in (and subject to the other terms and conditions of) Article 11 hereof.

1.155         "Shared Benefit Employees" means those Offered Employees (i) who do not accept an offer of employment made by Buyer pursuant to Section 7.1(a), which offer of employment contemplates a relocation of the Offered Employee's principal office to a location of more than fifty (50) miles from the location of the Offered Employee's principal office prior to such relocation and (ii) whose employment is terminated for any reason, other than for Cause or Poor Performance, which termination occurs on or after the date of the offer and on or before the ninetieth (90th) day after the Closing Date.

1.156         "Straddle Period" has the meaning set forth in Section 8.7(a)(i).

1.157         "Subsidiary" means with respect to a Party, any other corporation, limited liability company, general or limited partnership, unincorporated association or other business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Party, or one or more of the other Subsidiaries of such Party or a combination thereof, or (b) if a limited liability company, partnership, association or other business entity, a majority of the partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by such Party, or one or more Subsidiaries of such Party or a combination thereof.

1.158         "Subsidiary Consents" has the meaning set forth in Section 5.10(b).

1.159         "Subsidiary Contract" has the meaning set forth in Section 5.10(b).

1.160         "Subsidiary Leases" has the meaning set forth in Section 5.15(a).

1.161         "Subsidiary Real Property" means the real property described on Schedule 1.161 hereof.

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1.162          "Tax(es)" means any tax of any kind including United States or other national, state, provincial, regional, local or foreign income, net income, alternative or add on minimum, gross income, gross receipts, profits, windfall profits, property, ad valorem, franchise, sales, value‑added, use, capital, transfer, gains, license, excise, employment, payroll, premium, services, environmental transfer, withholding or minimum tax, or any other tax custom, duty, governmental fee or other like assessment or charge of any kind whatsoever, together with any interest and any penalty, addition to tax or additional amount imposed by any Governmental Authority.

1.163         "Tax Return" means any return, declaration, report, statement or information return or other document required to be filed with respect to any Taxes (including any attached schedules, statements or other documents), including any information return, claim for refund, amended return and declaration of estimated Tax.

1.164         "Technology" means inventions, works of authorship, mask works, models, know-how, and other information, including all designs, design and manufacturing documentation (such as bills of materials, build instructions and test reports), schematics, algorithms, routines, patterns, compilations, programs, methods, techniques, unpatented inventions, manufacturing and production processes and techniques, software, databases, lab notebooks, development and lab equipment, process, prototypes, published and unpublished research regarding products, clinical or otherwise, customer and supplier lists, formulas, pricing and cost information and devices.  Technology shall not include Intellectual Property Rights, including any Intellectual Property Rights in any of the foregoing.

1.165         "Territory" means worldwide.

1.166         "Third Party Licenses" means the Contracts identified on Schedule 1.166.

1.167         "Trade Secrets" has the meaning set forth in Section 1.81.

1.168         "Transfer" means the sale and transfer of the Transferred Assets from Seller (including the Subsidiaries of Seller) to Buyer (including the Buyer Subsidiaries).

1.169         "Transfer Taxes" means all transfer, documentary, sales, registration, value‑added, use and other Taxes, excluding income Taxes, arising in connection with the consummation of the transactions contemplated hereby.

1.170         "Transferred Accounts Receivables" means the accounts receivable of Seller included on the Final Net Working Capital Statement.

1.171         "Transferred Assets" means all right, title and interest of Seller and its Subsidiaries (excluding IPR) in and to the Transferred Equity Interests, the Transferred Inventory, the Transferred Tangible Assets, the Transferred Contracts, the Transferred Accounts Receivables, the Assigned Leases, the Subsidiary Leases, the Transferred Employee Records and the Transferred Real Property.

1.172         "Transferred Business" means such portion of the Business that constitutes the Transferred Assets, Transferred IPR and the Assumed Liabilities under this Agreement and the transactions contemplated hereby.

1.173         "Transferred Contracts" means the Contracts listed on Schedule 1.173 and any Subsidiary Contracts.

1.174         "Transferred Copyrights" means (a) the registered Copyrights listed on Schedule 1.174 and (b) the Copyrights owned by Seller in works of authorship that are used exclusively in the Business in the Licensed Field as of the Closing.  Notwithstanding, Buyer shall have full, unlimited ownership of the Transferred Copyrights as of the date of Closing, and shall have no limitation on the use of the Transferred Copyrights whether in the Licensed Field or otherwise.

1.175         "Transferred Employee" means each Employee that either (a) becomes an employee of Buyer (or a Subsidiary thereof) upon the Closing or (b) is an Automatic Transfer Employee; provided, however, the parties acknowledge that if an Employee of Seller does not accept an employment offer from Buyer, such Employee would never become a Transferred Employee for any purposes.

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1.176         "Transferred Employee Records" means (with such Transferred Employee's consent where legally required) the employment data, which discloses the terms and conditions under which an Employee is employed immediately prior to the Closing, and copies of all personnel files related thereto.

1.177         "Transferred Equity Interests" means the Equity Interests owned of record or beneficially by Seller and its Subsidiaries in the Transferred Subsidiaries. 

1.178         "Transferred Internet Properties" means the Internet Properties that are exclusively used in the Business as identified on Schedule 1.178.

1.179         "Transferred Inventory" means the raw materials, work in process, and finished goods used or held for use in the Business as of the Closing Date (including any on consignment or in transit, and wherever located).

1.180         "Transferred IPR" means (a) the Transferred Marks, (b) the Transferred Internet Properties, (c) the Transferred Trade Secrets, (d) the Transferred Copyrights, and (e) the Transferred Patents.

1.181         "Transferred Marks" means the Marks that are listed on Schedule 1.181(a) and all of the goodwill of the Business associated with or appurtenant to such Marks as of the Closing; provided, however, that in no event will such Marks include the term "Mentor", those terms identified on Schedule 1.181(b) or any variations thereof, or any trade marks or trade names incorporating such name or the "Mentor" logo, or any trade marks, logos or designs confusing therewith.

1.182          "Transferred Patents" means (i) the Patents (including applications) identified on Schedule 1.182 (ii) any Patent filed by Seller prior to the Closing that claims priority from a Patent identified on Schedule 1.182 as of the Offer Date  (in which case such Schedule shall be amended to add such Patent), and (iii) any Patent filed by Buyer following the Closing which claims priority from a Patent identified on Schedule 1.182 and which invention is in the Licensed Field and a Transferred Trade Secret.

1.183         "Transferred Real Property" means for non-U.S. Real Property, the Real Property identified on Schedule 1.183(a), and for U.S. Transferred Real Property, the Real Property identified on Schedule 1.183(b).

1.184         "Transferred Subsidiaries" means those direct and indirect Subsidiaries of Seller identified on Schedule 1.184.

1.185         "Transferred Subsidiary Employee" has the meaning set forth in Section 7.1(a).

1.186          "Transferred Tangible Assets" means the fixed and other tangible assets (other than real property and buildings and inventory) owned by Seller or any Seller Subsidiaries, other than Transferred Subsidiaries, listed in Schedule 1.186, including (a) the Transferred Technology, (b) the tangible embodiments of the Transferred Trade Secrets, (c) all personal productivity assets owned by Seller or any Seller Subsidiaries associated with Transferred Employees such as personal data assistants, cellular phones and personal computers, and (d) all notes, correspondence, document files, records, marketing materials, pamphlets and literature exclusively relating to the Business or the Products, in each case of clauses (a), (b), (c) and (d), as the same may be depleted or augmented prior to the Closing Date in the ordinary course of business; provided, however, that in no event will such assets include any Excluded Assets.

1.187         "Transferred Technology" means the Technology (other than Excluded Assets) owned by Seller or any Seller Subsidiaries that is used exclusively in the Business in the Licensed Field as of the Closing and the tangible embodiments of the Transferred Trade Secrets and the Transferred Copyrights.  Notwithstanding, Buyer shall have full, unlimited ownership of the Transferred Copyrights as of the date of Closing, and shall have no limitation on the use of the Transferred Copyrights whether in the Licensed Field or otherwise.

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1.188         "Transferred Trade Secrets" means the Trade Secrets (other than the Excluded Assets) owned by Seller or any Seller Subsidiaries that are exclusively used in the Business in the Licensed Field as of the Closing Date.  Notwithstanding, Buyer shall have full, unlimited ownership of the Transferred Trade Secrets as of the date of Closing, and shall have no limitation on the use of the Transferred Trade Secrets whether in the Licensed Field or otherwise.

1.189         "Transition Services Agreement" means the Transition Services Agreement of even date herewith in the form attached hereto as Exhibit C.

1.190         "Upward Adjustment Amount" has the meaning set forth in Section 2.4(d).

1.191         "UK" means the United Kingdom.

1.192         "UK Competition Authorities" means the UK OFT, the UK Competition Commission and any other Governmental Authority in the United Kingdom responsible for the enforcement of antitrust or merger control Laws.

1.193         "UK OFT" means the UK Office of Fair Trading.

1.194         "UK OFT Undertakings" means the undertakings given to the UK Secretary of State for Trade and Industry under Section 88(2) of the Fair Trading Act 1973 by Coloplast A/S, Coloplast Limited and 4C Health Limited following the report of the UK Competition Commission entitled "Coloplast A/S and SSL International plc: A report on the merger situation" (Cm 5811, May 2003) and announced in a Department of Trade and Industry Press Notice dated 22 July 2003 (P/2003/420), or any variations or amended versions thereof.

1.195         "U.S. Employee" has the meaning set forth in Section 7.1(a).

1.196         "Voluntary Transfer Employee" means each Offered Employee who becomes a Transferred Employee pursuant to the terms of this Agreement.

1.197         "Voting Debt" means bonds, debentures, notes or other indebtedness having the right to vote on any matters on which holders of other Equity Interests may vote. 

1.198         "Warranty Breach" means with respect to a Party, an inaccuracy or breach of a representation or warranty expressly made by such Party in an Operative Agreement.

1.199         "Year‑End Financials" has the meaning set forth in Section 5.12.

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1.200         "Years of Service" means, with respect to any Transferred Employee's prior service as an employee of either Seller or a Subsidiary of Seller, fully completed calendar years plus the pro rated time described in the following sentence.  Not fully completed calendar years shall be counted towards Years of Service at the rate of 1/12^th for each full calendar month of service.

(ii)             For all purposes of and under this agreement, the following capitalized terms shall have the respective meanings ascribed thereto in the section of this Agreement set forth opposite each such capitalized term below:

Capitalized Term	Section
ABISS	8.27
ABISS Agreement	8.27
Anoka Facility	8.24(b)(ii)
Anoka Sale	8.24(a)
Assigned Lease Premises	8.17(a)(ii)
Assumed Taxes	8.7(a)(i)
CERCLA	1.50
Changes	8.7(b)
CP UK	8.24(a)
Environmental Insurance	8.21
Evaluation Material	8.15(a)
FIFO	4.11(d)
Foreign Benefit Plan	5.13(b)(i)
FTC Amount	8.6(b)
Insurance Payment	11.6(a)
Internet Properties	1.81
Licensed MEC Mark	8.24(b)(viii)
Made	1.124
MEC	8.24(b)(i)
MENTOR CLEAR ADVANTAGE Mark	8.24(c)
Minneapolis Environmental Losses	11.3(d)(i)
Mitigation Payment	11.6(a)
MML Sale	8.24(a)
Offered Employees	7.1(a)
Other Business Property	11.3(d)(ii)
Party	Preamble
Patent Covenant	4.8
Preliminary Purchase Price Allocation	8.8
Qualifying Loss	11.3(b)
Residuals	4.4
Retained MEC Marks	8.24(b)(viii)
Retained Subsidiaries	8.28
Retention Payment	7.9
RMC	8.24(a)
RM UK	8.24(a)
Sarlat Property	11.3(d)(ii)(2)
SMEC	8.24(b)(ii)
Structural Representations	11.1
Termination	8.24(a)
Third Party Payment	11.6(a)
Threshold	11.3(b)
Transferred Names	8.19(a)
Transition Marks	4.11(e)
Transition Products	4.11(e)
UK MEC Marks	8.24(b)(viii)
UK MEC Products	8.24(b)(iii)
Year‑End Financials	5.12(a)

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Article 2

PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES

2.1                Transferred Assets; Transferred IPR

(a)                 Upon the terms and subject to the conditions set forth herein, including Section 2.3, Article 9 and Article 10, as of the Closing Date, Seller shall, and/or shall cause its Subsidiaries to, sell, transfer, convey, assign and deliver to Buyer, or if so requested by Buyer, to a Subsidiary of Buyer, free and clear of all Encumbrances, and Buyer shall purchase and accept from Seller and its Subsidiaries, the Transferred Assets.

(b)                 Upon the terms and subject to the conditions set forth herein, including Section 2.3, Article 9 and Article 10, as of the Closing Date Seller shall, and/or shall cause its Subsidiaries to, sell, transfer, convey, assign and deliver to Buyer, or if so requested by Buyer, to a Subsidiary of Buyer, free and clear of all Encumbrances, all right, title and interest of Seller and its Subsidiaries in and to the Transferred IPR, including the right to pursue past damages based on third‑party infringement of the Transferred IPR, and also including the goodwill of the Business appurtenant to the Transferred Marks included in the Transferred IPR.

(c)                 Buyer hereby waives compliance with the provisions of any applicable Laws which relate to the sale of property in bulk in connection with the transfer of the Transferred Assets to the Buyer.

2.2                Assumed Liabilities

Upon the terms and subject to the conditions hereof, as of the Closing Date, Seller shall, or shall cause its Subsidiaries to, assign and transfer to Buyer, and Buyer shall, or shall cause the Buyer Subsidiaries to, assume and fully perform and discharge, on a timely basis and in accordance with their respective terms, the Assumed Liabilities.  Notwithstanding the foregoing, other than the Assumed Liabilities specifically listed on Schedule 1.6, Buyer assumes no Liabilities of Seller, its Subsidiaries or any of its Affiliates.  Notwithstanding anything to the contrary, nothing shall include or be deemed to include among or within the Transferred Business, Transferred Assets, Transferred IPR, Transferred Internet Properties, any assets, Liabilities, IP, IPR or other property rights, or any Liabilities whatsoever with respect to, the ObTape® brand products, including any components thereof, any instruments or other accessories sold in conjunction with and for use strictly with ObTape®, and Marks, advertising and marketing materials used strictly with ObTape®.

2.3                Conveyances

Promptly following the execution and delivery of this Agreement, each of Buyer and Seller will cooperate in good faith to prepare and execute appropriate Contracts to convey or transfer the Transferred Assets, Transferred IPR and Assumed Liabilities held by Seller or its Subsidiaries to Buyer in connection with the Closing, or if so requested by Buyer, Subsidiaries of Buyer (the "Buyer Subsidiaries").  Each of the Parties will use commercially reasonable efforts to cause such transfers to be effected on the most efficient basis, including minimizing Transfer Taxes.  Such transfers shall be on terms (including conditions to Closing, representations and warranties, covenants and indemnification obligations) consistent with this Agreement, including the Purchase Price Allocation, except and only to the extent of modifications required to provide for the intent of this Agreement under applicable Laws (and in such case the minimal modifications required to do so) as may be required by applicable Laws.  Where appropriate, each of Buyer and Seller will cause its Subsidiaries to comply with any applicable Laws prior to entering into the Conveyance Documents.  With respect to any Transferred Assets, Transferred IPR or Assumed Liabilities, one or more bills of sale, assignment and assumption agreement, or similar conveyance documents as may be required under the Laws of the applicable jurisdiction to validly convey, assign and transfer such Transferred Assets, Transferred IPR or Assumed Liabilities (the "Conveyance Documents") may be used by Buyer or Seller in place of the Bills of Sale or the Assumption Agreement, as applicable.  The Parties agree that the Conveyance Documents are not intended to expand or limit the rights and obligations of Seller and Buyer beyond those provided for in this Agreement, and that the Conveyance Documents shall not provide for any additional rights or obligations of the Parties or their respective Subsidiaries that are not provided for in this Agreement or the other Operative Agreements (it being understood that for purposes of this sentence only, Operative Agreements shall not include the Conveyance Documents).  In the event of any conflict between the terms of the Conveyance Documents and this Agreement, the Parties agree and acknowledge that the terms of this Agreement shall control and that, if necessary, the Parties shall deliver such additional instruments as may be necessary to accomplish the foregoing.

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2.4                Net Working Capital Adjustment

(a)                 Within 60 days after the Closing Date, Buyer will prepare (i) a balance sheet as of the Closing Date, (the "Closing Date Balance Sheet"), which Closing Date Balance Sheet shall be prepared in accordance with GAAP on a consistent basis with the Year-End Financials, and (ii) a statement of Net Working Capital as of the Closing Date (the "Closing Date Net Working Capital Statement", and together with the Closing Date Balance Sheet, the "Closing Statements"), which Closing Date Net Working Capital Statement shall be derived from the Closing Date Balance Sheet.  Seller will assist and cooperate with Buyer in the preparation of the Closing Statements, including by providing Buyer with reasonable access to any relevant personnel, books and records related to the Transferred Assets, the Transferred IPR and the Assumed Liabilities and historical financial data that are in Seller's possession.  A spreadsheet illustrating the Closing Date Balance Sheet and the Closing Date Net Working Capital Statement (assuming in each case that the Closing Date had occurred on December 31, 2005) is attached as Exhibit D hereto for illustrative purposes.

(b)                 Following the delivery by Buyer to Seller of the Closing Statements, Seller shall have a period of 30 days in which to review the Closing Statements.  Seller and its accountants shall be provided with reasonable access to the Transferred Assets and the Transferred IPR, the work papers of Buyer and its accountants and to the books and records relating to the Transferred Assets, the Transferred IPR and the Assumed Liabilities in connection with such review.  In the event that Seller determines that the Closing Statements have not been prepared on a basis consistent with the requirements of Section 2.4(a), Seller shall, on or before the last day of such 30‑day period, inform Buyer in writing of such determination (the "Objection"), setting forth in reasonable detail a specific description of the basis of the Objection, the adjustments to the Closing Statements which Seller believes should be made, and Seller shall be deemed to have accepted any items not specifically disputed in the Objection.  Failure to so notify Buyer shall constitute acceptance and approval of Buyer's preparation of the Closing Statements.

(c)                 Buyer shall then have 30 days following the date it receives the Objection to review and respond to the Objection, during which period Buyer and Seller shall negotiate in good faith to resolve the Objection.  If Buyer and Seller are unable to resolve all of their disagreements with respect to the determination of the foregoing items by the 30th day following the date on which Buyer receives the Objection, after having used their good faith efforts to reach a resolution, they shall refer their remaining differences to KPMG LLP (or, if KPMG refuses to act in such capacity, such other nationally recognized accounting firm as the Parties shall reasonably agree) (the "CPA Firm"), who shall, acting as experts in accounting and not as arbitrators, determine on a basis consistent with the requirements of Section 2.4(a), whether and to what extent, if any, the Closing Statements require adjustment.  Buyer and Seller shall request the CPA Firm to use all reasonable efforts to render its determination within 45 days following submission of such matters to the CPA Firm.  The CPA Firm's determination shall be final, conclusive and binding upon Buyer and Seller, and nonappealable to any Person, court or forum absent manifest error or manifest bias.  Buyer and Seller shall promptly make reasonably available to the CPA Firm access to the Transferred Assets, all relevant books and records, any work papers (including those of the Parties' respective accountants, to the extent applicable) and supporting documentation relating to the Closing Statements and all other items reasonably requested by the CPA Firm.  The "Final Balance Sheet" and the "Final Net Working Capital Statement" shall mean, respectively, the Closing Date Balance Sheet and the Closing Date Net Working Capital Statement, as the case may be, (i) as submitted by Buyer pursuant to Section 2.4(a), in the event that (1) no Objection is delivered to Buyer during the initial 30‑day period specified above or (2) Buyer and Seller so agree, (ii) as adjusted in accordance with the Objection, in the event that (A) Buyer does not respond to the Objection during the 30‑day period specified above following receipt by Buyer of the Objection or (B) Buyer and Seller so agree, (iii) as adjusted in accordance with the agreement of Buyer and Seller, if the Parties so agree during the 30‑day period following receipt by Buyer of the Objection, or (iv) as adjusted by the CPA Firm, if it has been submitted to the CPA Firm for review, together with any other modifications to the Closing Statements agreed upon by the Parties.  All fees and expenses of the CPA Firm shall be shared equally by Buyer and Seller.

(d)                 If the Net Working Capital Target is greater than the Net Working Capital as reflected on the Final Net Working Capital Statement (the amount of such excess, the "Downward Adjustment Amount"), then Seller shall pay within ten (10) days to Buyer cash equal to the amount of the Downward Adjustment Amount.  If the Net Working Capital as reflected on the Final Net Working Capital Statement is greater than the Net Working Capital Target (the amount of such excess, the "Upward Adjustment Amount"), then Buyer shall pay within ten (10) days to Seller cash equal to the amount of the Upward Adjustment Amount.  Any payment pursuant to this Section 2.4(d) will be treated by the Parties as an adjustment to the Purchase Price.

2.5                No Withholding

Buyer shall make all payments required to be made to Seller hereunder free and clear of and without reduction for any withholding taxes which shall be the sole responsibility of Buyer.

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Article 3

CLOSING

3.1                The Closing

The transactions contemplated by this Agreement shall be consummated (the "Closing") at the offices of Wilson Sonsini Goodrich & Rosati, Professional Corporation, at 650 Page Mill Road, Palo Alto, California, no later than two Business Days after all of the conditions set forth in Article 9 and Article 10 shall have been satisfied or waived (other than those conditions that by their terms are not capable of being satisfied or waived until the Closing), or such other place, time and date as the Parties shall agree in writing.  The time and date on which the Closing is actually held is sometimes referred to herein as the "Closing Date."

3.2                Deliveries by Seller

At the Closing, Seller will deliver or cause to be delivered to Buyer (unless previously delivered) the following:

(a)                 duly executed share certificates or evidence of membership interests (as applicable), stock powers in blank or membership interest powers in blank (as applicable) in respect of each of the Transferred Equity Interests;

(b)                 duly executed counterparts to the Bills of Sale;

(c)                 duly executed counterparts of the assignments of the Transferred IPR in substantially the forms as set forth in Exhibit E-1 and Exhibit E-2 (collectively, the "IPR Assignment");

(d)                 limited or special warranty deeds transferring the Transferred Real Property to Buyer or its Subsidiaries, subject to any and all Permitted Encumbrances;

(e)                 duly executed counterparts of the Real Property Agreements;

(f)                  the certificate referred to in Section 9.5;

(g)                 the applicable Conveyance Documents with respect to each of the jurisdictions set forth in Schedule 3.2(g);

(h)                 certificates satisfying the requirements of Treasury Regulation § 1.1445-2 that exempt Buyer and the Buyer Subsidiaries from any requirement to withhold Taxes under Code § 1445;

(i)                   a duly executed counterpart of the Escrow Agreement;

(j)                  all Schedules and other documents, instruments, declarations, affidavits and writings as may be necessary to assign, convey, transfer and deliver to Buyer good and valid title to the Transferred Assets and Transferred IPR, free of Encumbrances, or as required to be delivered by Seller (or a Subsidiary thereof) at or prior to the Closing pursuant to the Operative Agreements; provided, however, that Buyer and Seller shall each file or record or cause to be filed and recorded such documents, instruments, declarations, affidavits or other writings as may be necessary in accordance with applicable Laws; provided, further, that the responsibility for the payment of all fees for applicable recordation and filings of documents, instruments, declarations, deeds, affidavits or other writings necessary to effect any applicable assignments or transfers under this Agreement and for recording any such assignments, including assignments with respect to the Transferred Real Property and the Transferred IPR, shall be split equally between Buyer and Seller;

(k)                 all documents and instruments necessary to effect filings with any Governmental Authority which are required to properly register the Products and relevant establishments in the Buyer's name effective as of the Closing Date (for example, FDA and its overseas counterparts' products and establishment licenses and environmental permits, etc.);

(l)                   the advice of the Workers' Council of Porges;

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(m)               evidence of release of the Encumbrances against the Transferred Assets identified on Schedule 3.2(m);

(n)                 all other documents, instruments and writings required to be delivered by Seller (or a Subsidiary thereof), at or prior to the Closing pursuant to the Operative Agreements.

3.3                Deliveries by Buyer

(a)                 At the Closing, Buyer will deliver or cause to be delivered to Seller (unless previously delivered) the following:

(i)            an amount equal to  the Preliminary Purchase Price less the Escrow Amount, which shall be paid by wire transfer of immediately available funds to an account designated by Seller; provided, however, that, if applicable, an appropriate portion of the Preliminary Purchase Price shall be paid in accordance with the terms of the Conveyance Documents (as determined by Seller in its reasonable judgment), with the remainder paid to Seller;

(ii)            a duly executed counterpart of the Assumption Agreement;

(iii)            a duly executed counterpart of the Escrow Agreement;

(iv)            duly executed counterparts to the applicable Conveyance Documents with respect to each of the jurisdictions set forth in Schedule 3.2(g);

(v)            the certificates referred to in Section 10.5;

(vi)            duly executed counterparts of the Real Property Agreements; and

(vii)            all other documents, instruments and writings required to be delivered by Buyer (or a Subsidiary thereof) at or prior to the Closing pursuant to the Operative Agreements.

(b)                 At the Closing, Buyer will deliver or cause to be delivered to the Escrow Agent the Escrow Amount in accordance with the terms of the Escrow Agreement.

Article 4

INTELLECTUAL PROPERTY LICENSES

4.1                Licensed IPR

Subject to the terms and conditions of this Agreement, effective as of the Closing, Seller hereby does grant, and shall  grant and cause its Subsidiaries to grant, to Buyer and its Subsidiaries, a worldwide, perpetual, irrevocable, non‑terminable, fully paid‑up, non‑exclusive, right and license:

(a)                 under all of Seller's rights in the Licensed Patents, to make, have made, use, sell, offer for sale, export and import products in the Licensed Field, and to practice any claimed method within such Licensed Patents in the Licensed Field. The Licensed Patents shall not be sublicensable by Buyer except in the ordinary course of business and only in connection with general license of all or substantially all of the Patents owned by Buyer in the Licensed Field to a third Person; and

(b)                 under all of Seller's rights in the Licensed Other IPR, to copy, use, perform, display, distribute, otherwise transfer products and services, and otherwise fully exploit (including by the granting of sublicenses) the Licensed Other IPR and conduct the business of Buyer following the Closing, subject to any restrictions on Buyer with respect to the Trade Secrets of Seller set forth in Section 4.6.

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4.2                License‑Back Patents

Subject to the terms and conditions of this Agreement, effective as of the Closing, Buyer and its Subsidiaries shall and do hereby grant to Seller and its Subsidiaries, and Seller and its Subsidiaries retain, a worldwide, perpetual, irrevocable, non‑terminable, fully paid‑up, non‑exclusive, right and license under all of Buyer's rights in the License‑Back Patents, to make, have made, use, sell, offer for sale, and import any product, and to practice any claimed method within the License‑Back Patents in the License-Back Field.  The License-Back Patents shall not be sublicensable by Seller except in the ordinary course of business and only in connection with general license of all or substantially all of the Patents in the License-Back Field owned by Seller to a third Person.

4.3                Limitations

(a)                 Existing Licenses.  All licenses granted by a Party ("Licensor Party") to the other Party or its Subsidiaries, as applicable ("Licensee Party") under this Article 4 are subject to any and all Contracts between the Licensor Party and any third Person entered into prior to the date hereof.

(b)                 Maintenance of Patents.  Where a Licensor Party no longer wishes to prosecute or maintain a Licensed Patent or License-Back Patent in force that could be so reasonably prosecuted or maintained in force, it shall offer assignment of the said application or Patent to the Licensee Party at no cost but shall retain a perpetual, irrevocable, non-terminable, royalty free, sublicensable, license to such transferred Patent.

4.4                License-Back Other IPR

Subject to Section 8.16, Buyer and its Subsidiaries shall and do hereby grant to Seller and its Subsidiaries under all rights in the License-Back Other IPR transferred to Buyer hereunder, and Seller and its Subsidiaries retain thereunder, a non-exclusive, worldwide, non-terminable, irrevocable, perpetual, assignable, sublicensable license to use, copy, distribute, otherwise transfer, create derivative works from, display, and perform the Licensed-Back Other IPR (and associated Technology) in all fields; provided, that (i) Seller agrees that it will not knowingly and specifically assign or sublicense such Licensed-Back Other IPR to a third party on a stand-alone basis in the Licensed Field and that the foregoing licenses shall be subject to Section 4.6 with respect to any Trade Secrets included in the License-Back Other IPR; (ii) the forgoing license to the Transferred Trade Secrets included in the Licensed Back Other IPR is limited in the Licensed Field to a license to Residuals only; and (iii) the foregoing license to the Transferred Copyrights included in the Licensed Back Other IPR excludes the use of the tangible embodiments of any such Copyrights in the Licensed Field.  "Residuals" means Trade Secret information retained in the unaided memory of employees that have been exposed to such Trade Secret information.

4.5                Reservation of Rights

Each of the Licensor Parties hereby reserves all rights not expressly granted hereunder.  No implied licenses are granted by Seller with respect to any of the Transferred Assets or pursuant to any term of this Agreement.

4.6                Trade Secret Protection and Use

Notwithstanding the retention of ownership of any Trade Secrets by Seller (and the license granted thereto to Buyer), or transfer of ownership of Trade Secrets to Buyer (with a license retained thereto by Seller) hereunder, each Party agrees (i) nothing set forth herein shall limit either Party's rights to enforce its rights with respect to the any misappropriation following the Closing by third parties of such Trade Secrets or to protect the confidentiality of such Trade Secrets regardless of whether such Trade Secrets are licensed to, or owned by such Party, and (ii) each Party shall treat the Trade Secrets of the other with at least the same degree of care, as its does its own like Trade Secrets, but in no event with less than reasonable care; provided that each Party may use and disclose the Trade Secrets of the other within the scope of the licensed granted hereunder.

4.7                Transfer

The Licensee Party may transfer or assign, in whole or in part, the licenses granted to it hereunder in connection with a Change of Control of the Licensee Party or the sale of substantially all of the assets of a business of the Licensee Party to which the license to be transferred or assigned relates.

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4.8                Products Outside of Licensed Field and License-Back Field

In the event that Seller and/or its Subsidiaries shall make, have made, use, sell, offer for sale, or import a product outside of the License-Back Field that, absent a license, infringes or would infringe any of the Transferred Patents, Seller shall so notify Buyer, and thereafter, Buyer shall license to Seller such Transferred Patents for use in such field of use (but in no event within the Licensed Field) upon commercially reasonable terms, which such terms shall be negotiated in good faith by Buyer and Seller (the foregoing, the "Patent Covenant").  If Seller infringes any Transferred Patents outside the License-Back Field and does not seek a license to such Patents in accordance with the foregoing Patent Covenant, Buyer's sole and exclusive remedy shall be to bring an action seeking a reasonable royalty for a license to such Patents and for past royalty payments that would have been due; provided, however, Buyer (or any successor to the Transferred Patents) shall not have the right to seek or obtain an injunction against Seller's infringement of such Patents and if Buyer is the prevailing party in such action, Buyer shall be entitled to payment of Buyer's legal fees and expenses by Seller.  Buyer agrees that in the event of an assignment or transfer of any of the Transferred Patents, Buyer (and any subsequent transferee) shall obtain the agreement of the transferee or successor to such Transferred Patents, for the benefit of Buyer and its successors, to the Patent Covenant.  In the event that Buyer (or any subsequent transferee of the Transferred Patents) fails to obtain agreement to such Patent Covenant, the Seller shall be deemed to have, effective as of the date hereof, a non-exclusive, royalty free, perpetual worldwide license to such Patents in all fields other than the Licensed Field.

4.9                Bulking Agent and/or Toxin

In the event that Seller shall seek to first commercialize a dermal filler or other bulking agent or toxin (including a botulinum toxin), as the case may be, in the Licensed Field after the Closing Date, then Seller shall provide Buyer the reasonable opportunity to discuss in good faith a mutually beneficial arrangement for the commercialization of such dermal filler or other bulking agent or toxin, as the case may be, in the Licensed Field; in no event such opportunity to be later than thirty (30) days prior to Seller entering into an agreement, if any, for such first commercialization with a third party.  Seller's obligations under this Section 4.9 shall terminate on the tenth (10^th) anniversary of the Closing Date.

4.10            Exclusive Patent

If Schedule 1.182 omits any Patents owned by Seller as of the Closing Date that as of the Closing Date claim an invention that is exclusive to the Licensed Field, Buyer shall, as its sole and exclusive remedy for such omission, be granted and shall have effective as of the Closing Date, a perpetual, worldwide, royalty free, paid-up license in the Licensed Field to such Patent with the right to bring an action for the infringement of such Patent or Patents in the Licensed Field.  Such license shall be exclusive in the Licensed Field as of the date the determination is made that such Patent was omitted from Schedule 1.182.

4.11            License to Transition Marks

(a)                 Seller hereby grants to Buyer, effective as of the Closing Date, a worldwide, non-exclusive, non-transferable license under the Transition Marks (as defined below) to use such Transition Marks in connection with the marketing, packaging, sale and promotion of Transition Products (as defined below) in substantially the same manner that such Transition Marks were used by Seller prior to the Closing.  All goodwill associated with the use of such Transition Marks shall inure to the benefit of Seller.

(b)                 Buyer shall maintain the quality of the goods with which such Transition Marks are used at least at the same level maintained by Seller prior to the Closing.  Without limiting the foregoing, Buyer shall not (i) use the Transition Marks in a manner that detracts from the goodwill associated with such Transition Marks or in a manner contrary to the reasonable instructions of Seller, (ii) co-brand the Products with any other Marks without the prior written consent of Seller, or (iii) sell any Transition Product beyond its shelf life or in any other improper manner.  Buyer shall not make any warranty, express or implied, to any third party on behalf of Seller with respect to the Transition Products and except as may be otherwise provided under this Agreement shall be solely responsible for all Transition Products sold by it.

(c)                 Notwithstanding the license set forth in Section 4.1(a), Buyer will use reasonable commercial efforts, subject to regulatory requirements, to cease using the Transition Marks as promptly as practicable following the Closing, and replace such Marks with new Marks owned by Buyer.  Without limiting the generality of the foregoing, in no event may Buyer market, package, sell or promote any product under or bearing a Transition Mark that shall have been manufactured by or for Buyer which manufacture shall have occurred after the last day of the 18th month following the Closing Date.

(d)                 Buyer will sell Transition Products in inventory on a first-in-first-out (FIFO) basis.  Buyer will not increase inventory levels of Transition Products beyond levels consistent with historic inventory levels of such Transition Products.

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(e)                 For the purposes of this Section 4.11, (A) "Transition Products" means (i) all Products in Seller's inventory as of the Closing Date and (ii) all such Products manufactured by or for Buyer in accordance herewith and sold by Buyer under a Transition Mark; and (B) "Transition Marks" means all Marks used by Seller prior to the Closing Date in connection with the marketing, sale, promotion and packaging of the Transition Products.

Article 5

REPRESENTATIONS AND WARRANTIES OF SELLER

Subject to the Schedules and the disclosures and exceptions set forth in the Disclosure Letter delivered by Seller to Buyer on the date hereof (the "Disclosure Letter") (which disclosures and exceptions will reference the appropriate section of this Article 5 to which they relate and each of which disclosures and exceptions shall be deemed to be incorporated by reference into the representations and warranties; provided, that any information disclosed in the Disclosure Letter shall be deemed disclosed and incorporated in any other section, subsection, clause and paragraph hereof where it is reasonably apparent that such disclosure is applicable to such other section, subsection, clause or paragraph) Seller hereby makes the following representations and warranties to Buyer as of the Offer Date:

5.1                Organization and Authority

(a)                 Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Minnesota.  Seller has the requisite corporate power and authority to execute and deliver this Agreement and each of the Operative Agreements to which it is a party and to perform its obligations hereunder and thereunder.  Seller is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where such qualification is necessary, except for those jurisdictions where failure to be so qualified would not, individually or in the aggregate, have a material adverse effect on Seller or prevent the performance by Seller of its obligations under this Agreement or the other Operative Agreements to which it is a party.

(b)                 Each of the Transferred Subsidiaries is duly organized, validly existing and in good standing (to the extent such jurisdiction recognizes the concept or similar concept) under the laws of the jurisdiction in which it was formed.  Each of the Transferred Subsidiaries has the requisite corporate power and authority to execute and deliver each of the Operative Agreements (if applicable) to which it is a party and to perform its obligations thereunder.  Each of the Transferred Subsidiaries is duly qualified to do business in and is in good standing in each jurisdiction where such qualification is necessary, except for those jurisdictions where failure to be so qualified or in good standing would not, individually or in the aggregate, be reasonably likely to have a material adverse effect on Seller or prevent the performance by Seller of its obligations under this Agreement or the other Operative Agreements to which it is a party.

(c)                 This Agreement is as of the date hereof, and each of the other Operative Agreements to which Seller or a Subsidiary is a party will be, upon their execution and delivery, duly and validly authorized, executed and delivered by Seller or the applicable Subsidiary and this Agreement constitutes, and each of the other Operative Agreements to which Seller or a Subsidiary is a party will constitute, the valid and binding agreement of Seller or the applicable Subsidiary, enforceable against Seller or the applicable Subsidiary in accordance with its respective terms, subject to bankruptcy and debtor creditor laws of general application, rules of equity and rules concerning specific performance (collectively, the "Enforceability Exceptions").  No other actions or proceedings on the part of Seller are necessary to authorize Seller's execution or performance of this Agreement or any of the other Operative Agreements to which it is a party or the transactions contemplated hereby or thereby.

5.2                Transferred Subsidiaries; Capitalization

(a)                 Except for the Transferred Equity Interests, Seller does not own or hold, directly or indirectly, any Equity Interest of any kind in any Person that owns assets or properties or conducts operations used or held for use in the Business.  All of the Transferred Equity Interests have been duly authorized and validly issued and are fully paid and non-assessable, to the extent such terms are applicable to such Transferred Equity Interests, with no personal liability attaching to ownership thereof, and such Transferred Equity Interests are owned by Seller, in each case free and clear of any Encumbrances.  Upon consummation of the transactions contemplated hereby, Buyer and/or a Subsidiary of Buyer will acquire good and valid title to the Transferred Equity Interests free and clear of all Encumbrances, other than Encumbrances placed upon such Transferred Equity Interests by Buyer or its Subsidiaries or generally applicable to the assets of Buyer and/or its Subsidiaries. Except for this Agreement, the Transferred Equity Interests and as described in Section 5.2(a) of the Disclosure Letter, there are no outstanding Equity Interests in the Transferred Subsidiaries.  There are no Contracts or other arrangements by which the Transferred Subsidiaries are, may be or become bound to issue additional Equity Interests in the Transferred Subsidiaries.

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(b)                 Neither Seller nor any of its Subsidiaries is subject to any obligation or requirement to provide funds to or make any investment (whether in the form of a loan, capital contribution or otherwise) in any of the Transferred Subsidiaries.

(c)                 The jurisdiction of organization and authorized Equity Interests of each Transferred Subsidiary is set forth in Section 5.2(c) of the Disclosure Letter.  There are no outstanding obligations of the Transferred Subsidiaries to repurchase, redeem or otherwise acquire any shares of capital stock or membership interests of the Transferred Subsidiaries or pursuant to which any Transferred Subsidiary is required to register any Equity Interests under the Securities Act of 1933, as amended (the "Securities Act") or under any other Laws.  None of the Transferred Subsidiaries has any outstanding Voting Debt.

5.3                No Violation

The execution and delivery by Seller of this Agreement, and by Seller and its Subsidiaries under each of the other Operative Agreements to which any of them is a party, does not, and the performance by Seller of its obligations hereunder, and by Seller and its Subsidiaries under each of the other Operative Agreements to which any of them is a party, will not: (a) conflict with, or result in a breach of, any of the provisions of any of their respective charter documents, bylaws or similar organizational documents; (b) materially breach, violate or contravene any applicable Laws; (c) create any right of termination or acceleration or Encumbrance that would prevent Seller or any of its Subsidiaries from performing its obligations under this Agreement or any other Operative Agreement to which any of them is a party; (d) assuming that the Consensual Transfers identified in Section 5.10(a) of the Disclosure Letter are obtained, conflict with, or result in a breach of or default under, any Transferred Contract in any material respect; or (e) conflict with, or result in a breach of or default under, any material Subsidiary Contract in any material respect.

5.4                Compliance with Laws; Business Permits

No Governmental Actions on the part of Seller or any of its Affiliates or Subsidiaries are required in connection with the execution or delivery by Seller of this Agreement or by Seller or any of its Subsidiaries under any of the Operative Agreements to which it is a party or the consummation by Seller of the transactions contemplated hereby or the consummation by Seller or any of its Subsidiaries of the transactions contemplated thereby, other than pursuant to HSR and such other Governmental Actions identified on Section 5.4 of the Disclosure Letter.  For the avoidance of doubt, neither Seller nor any of its Subsidiaries hereby make any representations or warranties to Buyer as to the compliance with the UK OFT Undertakings of Buyer, any of its Subsidiaries or other parties to the UK OFT Undertakings.  Seller and the Transferred Subsidiaries, as the case may be, hold, to the extent legally required, all material permits, licenses, variances, clearances, consents, commissions, foreclosures, exemptions, orders, authorizations and approvals from Governmental Authorities that are required for them to conduct the Business in accordance with all applicable Laws (the "Business Permits").  Seller and the Transferred Subsidiaries have conducted and operated, and are conducting and operating, the Business in accordance with the terms of the Business Permits and in compliance with all Laws applicable to the Business, its properties and affairs, including employment and immigration Laws, in all material respects.

5.5                No Broker

None of Seller or any Subsidiary of Seller, has engaged any Person, other than Citigroup Global Markets Inc. (the fees of which shall be paid by Seller), which is entitled to any fee or commission as a finder or a broker in connection with this Agreement or the transactions contemplated hereby.

5.6                Absence of Changes

Since the date of the Most Recent Balance Sheet and through the Offer Date there has not been:

(a)                 any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Seller Material Adverse Effect;

(b)                 any creation or other incurrence of any Encumbrance on any Transferred Asset other than Encumbrances created or incurred in the ordinary course of business;

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(c)                 any Contract entered into by Seller primarily relating to the Business or any Transferred Assets (including the acquisition or disposition of any assets) material to the Business or to the Transferred Assets and Transferred IPR, taken as a whole or exceeding $100,000 per annum, other than Contracts entered into in the ordinary course of business and those contemplated by this Agreement and the other Operative Agreements; or any Contract entered into by Seller resulting in an Encumbrance other than a Permitted Encumbrance with respect to Real Property;

(d)                 any receipt of written notice by Seller of any termination by any customer, supplier or other third Person in connection with, and material to, the Business;

(e)                 any material damage, destruction or loss to the assets of the Business;

(f)                  any (i) employment, deferred compensation, severance, retirement or other similar Contract entered into with any Transferred Employee (or any amendment to any such existing Contract) other than as required by Law or in the ordinary course of business, (ii) grant of any right to severance or termination pay to any Transferred Employee, other than in the ordinary course of business, (iii) change in compensation or other benefits payable to any Transferred Employee pursuant to any severance or retirement plans or policies thereof, other than in the ordinary course of business, or (iv) other change in the compensation or benefits structure applicable to the Transferred Employees in a manner that adversely affects in a material respect the cost structure of the Business;

(g)                 any payment, discharge or satisfaction of any claim, Encumbrance, obligation or Liability of the Business, other than (i) Permitted Encumbrances, (ii) the payment, discharge or satisfaction of claims, Encumbrances, obligations or liabilities reflected or reserved against in the Most Recent Balance Sheet or (iii) in the ordinary course of business;

(h)                 any write down or write up in the value of any Transferred Inventory, or any determination as collectible of any Transferred Accounts Receivable or any part thereof which were previously considered uncollectible, or any write off as uncollectible of any Transferred Accounts Receivable or any part thereof, except in each case for write downs, write ups, and write offs in the ordinary course of business consistent with past practice;

(i)                   except in the ordinary course of business, any disposition of or permission to lapse of any right to the use of any of the Transferred IPR, or application therefor or any disposition of, or to Seller's Knowledge any disclosure of any Transferred Trade Secrets or other confidential information constituting Transferred IPR to Persons not bound by confidentiality obligations;

(j)                  except in the ordinary course of business and except for the capital expenditure commitments described on Section 5.6(j) of the Disclosure Letter, making by the Business of any capital expenditure or commitment in excess of $500,000 for additions to property, plant, equipment, intangible or capital assets or for any other purpose, other than for emergency repairs or replacements;

(k)                 any entry related to the Business, into any collective bargaining or labor Contract, or any experience of any organized slowdown, work interruption, strike or work stoppage;

(l)                   sale, transfer or other disposition of any of the Transferred Assets except in the ordinary course of business;

(m)               any grant or incurrence of any obligation for any increase in the compensation of any Transferred Employee (including same pursuant to any bonus, pension, profit sharing, retirement or other plan or commitment) except for raises to Transferred Employees in the ordinary course of business consistent with past practices;

(n)                 any change in any method of accounting or accounting principles, practices or policies of Seller with respect to the Financial Statements except as required by a concurrent change in GAAP or the rules and regulations of the Securities and Exchange Commission;

(o)                 any Contract, whether in writing or otherwise, to take any of the actions set forth in this Section 5.6 except as otherwise specifically permitted or contemplated by this Agreement or any other Operative Agreement.

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5.7                Contracts

As of the Offer Date, neither Seller nor any of the Transferred Subsidiaries is a party to or bound by, nor has Seller or any Transferred Subsidiary made any commitment with respect to any of the following with respect to the Business:

(a)                 any Contract relating to the pending acquisition or disposition of any business or product line (whether by merger, sale of stock, sale of assets or otherwise);

(b)                 any Contract which creates any Encumbrance on any Transferred Asset or Transferred IPR;

(c)                 any Contract concerning the establishment or operation by the Business of a partnership, joint venture or limited liability company;

(d)                 any Contract relating to the Business concerning or containing restrictions on business activities, including noncompetition or nonsolicitation (other than noncompetition or nonsolicitation agreements entered into with Employees in the ordinary course of business);

(e)                 any employment Contract (other than "at will" employment Contracts and Contracts arising as a matter of applicable Law) with any Transferred Employee or consulting Contract with any Person (other than consulting Contracts terminable by Seller or its Subsidiaries without cause or penalty and with no more than 30 days advance notice) providing for fixed annual cash compensation in excess of $50,000 or any employee retention, stay or bonus Contracts;

(f)                  any collective bargaining, workers' council or similar Contract relating to the Business entered into with any trade union, workers' council or other group of employee representatives;

(g)                 any Contract (excluding Assigned Leases and Subsidiary Leases) under which the consequences of a default or termination would reasonably be expected to have a Seller Material Adverse Effect; or

(h)                 any Contract (excluding Assigned Leases and Subsidiary Leases) which contains any provisions requiring Seller or any Transferred Subsidiary to indemnify any other party (other than (i) indemnities against breach of the obligations contained in Contracts which were entered into in the ordinary course of business, including ordinary course, generic director, officer and employee indemnification agreements not relating to specific or particular subjects and (ii) indemnities against IPR infringement contained in non-exclusive licenses entered into in the ordinary course).

5.8                Taxes

(a)                 To the extent that failure to do so would materially adversely impact the Transferred Assets or the Buyer's ownership of the Transferred Assets or operation of the Business, Seller and the Transferred Subsidiaries (a) have timely paid all Taxes they are required to pay or have provided adequate accruals on its Financial Statements for all Taxes it is required to pay and (b) have timely filed all required federal, state, local and foreign returns, estimates, information statements and reports (collectively, "Returns") relating to any and all Taxes concerning or attributable to the Transferred Assets or the Business and such Returns are true, correct and complete, prepared in accordance with applicable Laws and have timely filed all other material Tax returns required to be filed by them.

(b)                 Seller and the Transferred Subsidiaries have timely paid or withheld with respect to their Employees and other third parties (and timely paid over any withheld amounts to the appropriate Taxing authority) all federal and state income taxes, Federal Insurance Contribution Act, Federal Unemployment Tax Act and other Taxes required to be withheld or paid.

(c)                 There are no Encumbrances with respect to any Taxes upon any of the Transferred Assets, other than with respect to Taxes not yet due and payable.

(d)                 Seller does not know of any basis for the assertion of any claim for any liabilities for unpaid Taxes of Seller or the Transferred Subsidiaries for which Buyer would become liable as a result of the transactions contemplated by this Agreement or that would result in any Encumbrance on any of the Transferred Assets.

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(e)                 To the extent applicable to the Transferred Assets or the Buyer's ownership of the Transferred Assets or operation of the Business, Seller has not been delinquent in the payment of any material Tax, nor is there any Tax deficiency outstanding, assessed or proposed against Seller, nor has Seller executed any outstanding waiver of any statute of limitations on or extension of the period for the assessment or collection of any Tax.

(f)                  To the extent applicable to the Transferred Assets or the Buyer's ownership of the Transferred Assets or operation of the Business, (i) no audit or other examination of any Return of Seller is presently in progress, nor has Seller been notified of any request for such an audit or other examination; (ii) no adjustment relating to any Return filed by Seller has been proposed formally or, to the Knowledge of Seller, informally by any tax authority to Seller or any representative thereof; and (iii) no claim has ever been made by an authority in a jurisdiction where Seller does not file Returns that it is or may be subject to taxation by that jurisdiction. 

5.9                Transferred Tangible Assets

Seller or its Subsidiaries have good and marketable title to the Transferred Tangible Assets, free and clear of any Encumbrances.  To the Knowledge of Seller, such Transferred Tangible Assets are in good operating condition, free of any material defects (except those resulting from normal wear and operation).  The Transferred Tangible Assets will constitute at the Closing, all of the material tangible assets (other than Infrastructure Assets) held by Seller or any of its Subsidiaries and primarily used or held for use in the Business.

5.10            Transferred Contracts; Subsidiary Contracts

(a)                 Each Transferred Contract is a valid and binding agreement of Seller or a Subsidiary of Seller, is in full force and effect and, to the Knowledge of Seller, is enforceable according to its terms, subject to the Enforceability Exceptions.  Each of Seller and its Subsidiaries has performed or is performing all material obligations required to be performed by it under the Transferred Contracts and is not in breach or default in any material respect thereunder and, to the Knowledge of Seller, no other party to any Transferred Contract is in breach or default in any material respect thereunder.  True and complete copies of each Transferred Contract have been made available to Buyer.  Section 5.10(a) of the Disclosure Letter sets forth a list of all consents to transfers, assignments and novations required as of the Closing in connection with the assignment of the Transferred Contracts as contemplated by this Agreement (the "Consensual Transfers").  Notwithstanding the foregoing, Seller makes no representation or warranty with respect to the Transferred Contracts regarding infringement or misappropriation of Intellectual Property Rights except those expressly made pursuant to Section 5.11.

(b)                 Each Contract (excluding Subsidiary Leases) to which a Transferred Subsidiary is a party (each such Contract, a "Subsidiary Contract"), is a valid and binding agreement of such Transferred Subsidiary and is in full force and effect and, to the Knowledge of Seller, is enforceable according to its terms, subject to the Enforceability Exceptions.  Each Transferred Subsidiary has performed or is performing all material obligations required to be performed by it under the Subsidiary Contracts and is not in breach or default in any material respect thereunder and, to the Knowledge of Seller, no other party to any Subsidiary Contract is in breach or default in any material respect thereunder.  True and complete copies of each material Subsidiary Contract have been made available to Buyer.  Section 5.10(b) of the Disclosure Letter sets forth a list of all consents to transfers and assignments required in respect of the Subsidiary Contracts as of the Closing in connection with the transactions contemplated by this Agreement (the "Subsidiary Consents").

(c)                 As of the Offer Date, the Third Party Licenses listed on Schedule 1.166 are all of the licenses between Seller (or a Subsidiary thereof) and a third Person pursuant to which such third Person has licensed software or other IPR (except for Marks) to Seller or a Transferred Subsidiary that is material to, and used by Seller or any of its Subsidiaries in the Business (other than Infrastructure Assets and software licensed under industry typical object code licenses and generally available in the marketplace).  Schedule 1.166 indicates which of such Third Party Licenses that Seller or its Subsidiaries may transfer to Buyer or a Buyer Subsidiary in accordance with the terms of such license and without Seller, or the applicable Transferred Subsidiary, incurring any material Liability to such third Person.

5.11            Intellectual Property

(a)                 To the Knowledge of Seller, as of the Offer Date, neither Seller nor any Subsidiary has received written notice within the four-year period preceding the Offer Date of any material claim that the conduct of the Business by Seller or its Subsidiaries infringes, misappropriates or otherwise violates the Intellectual Property Rights of any third Person.

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(b)                 To the Knowledge of Seller, as of the Offer Date, the conduct of the Business by Seller and its Subsidiaries does not infringe any Patent held by any third Person.

(c)                 To the Knowledge of Seller, as of the Offer Date, the conduct of the Business by Seller and its Subsidiaries has not and does not infringe or misappropriate any Copyright, Trade Secret or Mark held by any third Person.

(d)                 The issued Patents identified on Schedule 1.94 (as such schedule may be supplemented prior to the Closing Date) together with the Transferred Patents are the only issued Patents owned or licensable by Seller and its Subsidiaries that, absent a license, would be infringed by Buyer's and its Subsidiaries' conduct of the Business immediately after the Closing Date (assuming the conduct of the Business by Buyer and its Subsidiaries immediately after the Closing is the same as the conduct of the Business by Seller and its Subsidiaries immediately prior to the Closing).

(e)                 As of the Offer Date, there have been no written claims within the four-year period preceding the Offer Date against Seller or its Subsidiaries asserting the invalidity, misuse or unenforceability of any Transferred IPR.

(f)                  Seller owns all right, title and interest in and to all of the Transferred IPR and/or has the right and authority to transfer such Transferred IPR to Buyer in accordance with the terms hereof free and clear of any and all Encumbrances but subject to any prior non-exclusive licenses granted by Seller or its Subsidiaries prior to the Closing pursuant to Section 8.2.

(g)                 Seller and its Subsidiaries have taken reasonable steps to protect Seller's and its Subsidiaries' rights in Trade Secrets relating to the Business that it wishes to protect, and without limiting the foregoing, Seller and each Transferred Subsidiary have a policy requiring each Employee and contractor materially involved in proprietary aspects of the Business to execute nondisclosure of proprietary information and confidentiality agreements and Seller and each Transferred Subsidiary have implemented such policy.

(h)                 There are no Contracts (other than Transferred Contracts), which provide for any future cash payments to Seller or a Subsidiary thereof for the use of the Transferred IPR.

(i)                   Section 5.11(i) of the Disclosure Letter lists (i) all items of Transferred IPR that are subject to a formal registration with the United Stated Patent and Trademark Office, Copyright Office or similar authority anywhere in the world that, to the Knowledge of Seller, will expire or otherwise require action to continue, renew or maintain same within the six (6) month period after the Offer Date and (ii) such information as Seller's intellectual property counsel is able to reasonably provide from a review of standard docket reports as of the Offer Date.

(j)                  There is no currently pending, or to Seller's Knowledge threatened, adverse decisions or claims in which Seller is a named party with respect to any opposition, cancellation, injunction or other claim or restriction concerning the Transferred IPR.

(k)                 To Seller's Knowledge, the Transferred IPR is valid and enforceable.

5.12            Financial Statements and Reports

(a)             Section 5.12(a) of the Disclosure Letter sets forth the following with respect to the Business: (i) (A) the audited balance sheet as of March 31, 2005 and the related audited statements of income and cash flows for the 12‑month period ended March 31, 2005 and the related notes of Seller and its Subsidiaries related to the Business and (B) the unaudited balance sheet as of March 31, 2004 and the related unaudited income statement for the 12‑month period ended March 31, 2004 of Seller and its Subsidiaries related to the Business ((A) and (B) together, the "Year‑End Financials"), and (ii) unaudited balance sheet as of December 31, 2005 (the "Most Recent Balance Sheet"), and the related unaudited income statement for the 9‑month period ended December 31, 2005 of Seller and its Subsidiaries related to the Business (together with the Most Recent Balance Sheet, the "Interim Financials").  The Year‑End Financials and the Interim Financials (collectively, the "Financial Statements") have been prepared in accordance with GAAP, applied in a consistent manner, except that the Interim Financials do not contain the notes required by GAAP.  The Financial Statements present fairly the financial condition, operating results and cash flows of the Business as of the dates and for the periods indicated therein.

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(b)                 Neither Seller nor any Transferred Subsidiary has any Liability with respect to the Business, except for (i) Liabilities reflected in the Financial Statements, (ii) Liabilities which have arisen since the date of the Most Recent Balance Sheet in the ordinary course of business, (iii) contractual and other Liabilities incurred but which are not required by GAAP to be reflected on a balance sheet and (iv) the Excluded Liabilities.

(c)                 Seller and each Transferred Subsidiary maintain accurate books and records reflecting their respective assets and liabilities and maintain proper and adequate internal accounting controls which are designed to provide reasonable assurance that (i) transactions related to the Business are executed with management's authorization, (ii) transactions are recorded as necessary to permit preparation of the financial statements of Seller and its Subsidiaries and to maintain accountability for the assets of the Business, (iii) access to assets of the Business is permitted only in accordance with Seller's management's authorization, (iv) the reporting of assets of the Business is compared with existing assets at regular intervals, and (v) accounts, notes and other receivables and inventory related to the Business were recorded accurately, and proper and adequate procedures are implemented to effect in all material respects the collection thereof on a current and timely basis.

5.13          Benefit Plan Compliance

(a)                 Domestic Plans.

(i)            The Employee Benefits Plans currently maintained by, or contributed to by Seller or any ERISA Affiliate for the benefit of Employees on Seller's United States payroll (each a "Seller Domestic Benefit Plan") that are subject to the Laws of the United States are those listed in Section 5.13(a)(i) of the Disclosure Letter, and a copy or summary of each has been furnished or made available to Buyer.

(ii)            Each Seller Domestic Benefit Plan intended to be qualified under Section 401(a) of the Code, has obtained a favorable determination, notification, advisory and/or opinion letter, as applicable, as to its qualified status from the Internal Revenue Service.  Seller and each ERISA Affiliate and, to the Knowledge of Seller, each of the Seller Domestic Benefit Plans, are in compliance with the provisions of the applicable Laws (if any) under which the Seller Domestic Benefit Plans are maintained, and with the terms of such Seller Domestic Benefit Plans.

(iii)            Except as may be set forth in Section 5.13(a)(iii) of the Disclosure Letter, all contributions to the Seller Domestic Benefit Plans which may have been required to be made in accordance with the terms of any such plan, and, when applicable, the Law of the jurisdiction in which such plan is maintained, have been made.

(iv)            Except as set forth in Section 5.13(a)(iv) of the Disclosure Letter, all reports and returns, including Forms 5500, with respect to any Seller Domestic Benefit Plan required to be filed by Seller with any Governmental Authority or distributed to any Seller Domestic Benefit Plan participant by Seller have been duly filed or distributed.

(v)            Except as set forth in Section 5.13(a)(v) of the Disclosure Letter, there are no pending investigations by any Governmental Authority involving the Seller Domestic Benefit Plans, and there are no claims pending or, to the Knowledge of Seller, threatened against Seller (except for claims for benefits payable in the normal operation of the Seller Domestic Benefit Plans) nor, are there any facts that could give rise to any Liability in the event of such investigation, claim, suit or proceeding.

(vi)            Neither Seller nor any ERISA Affiliate has incurred any Liability under Title IV of ERISA, including any Liability under Sections 4062, 4063 or 4064 of ERISA, or any withdrawal liability, within the meaning of Section 4201 of ERISA or potential withdrawal liability arising from a transaction described in Section 4204 of ERISA.

(vii)            Seller and each ERISA Affiliate have complied with the notice and continuation coverage requirements of Section 4980B of the Code and the regulations thereunder with respect to each Seller Domestic Benefit Plan that is, or was during any taxable year of Seller or any ERISA Affiliate for which the statute of limitations on the assessment of federal income Taxes remains open, by consent or otherwise, a group health plan within the meaning of Section 5000(b)(1) of the Code except for such noncompliance as would not reasonably be expected to subject Buyer, or any of the Transferred Assets, to any material liability.

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(b)           Foreign Plans.

(i)            The only Employee Benefits Plans maintained by, or contributed to by Seller, any Transferred Subsidiary or any ERISA Affiliate for the benefit of Employees or former Employees that are subject to the Laws of jurisdictions other than the United States, and that it is anticipated by Seller that Buyer will be required to assume or continue either by operation of Law or by the terms of this Agreement, are those listed in Section 5.13(b)(i) of the Disclosure Letter (each a "Foreign Benefit Plan").  A copy or summary of each Foreign Benefit Plan, and, where applicable, a copy of the most recent actuarial report has been furnished or made available to Buyer.

(ii)            Seller, each Transferred Subsidiary and each ERISA Affiliate and, to the Knowledge of Seller, each of the Foreign Benefit Plans, are in compliance with the provisions of the applicable Laws of each jurisdiction in which any of the Foreign Benefit Plans are maintained, to the extent such Laws are applicable to the Foreign Benefit Plans and with the terms of such Foreign Benefit Plans.

(iii)            Except as may be set forth in Section 5.13(b)(iii) of the Disclosure Letter, all contributions to or accruals for the Foreign Benefit Plans which may have been required to be made in accordance with the terms of any such plan, and, when applicable, the Law of the jurisdiction in which such plan is maintained, have been made.

(iv)            Except as set forth in Section 5.13(b)(iv) of the Disclosure Letter, all reports and returns with respect to any Foreign Benefit Plan required to be filed by Seller with any Governmental Authority or distributed to any Foreign Benefit Plan participant by Seller have been duly filed or distributed.

(v)            Except as set forth in Section 5.13(b)(v) of the Disclosure Letter, there are no pending investigations by any Governmental Authority involving the Foreign Benefit Plans, and there are no claims pending or, to the Knowledge of Seller, threatened against Seller (except for claims for benefits payable in the normal operation of the Foreign Benefit Plans), nor, are there any facts that could give rise to any Liability in the event of such investigation claim, suit or proceeding.

5.14         Labor Matters

(a)            Section 5.14(a) of the Disclosure Letter contains a list of any collective bargaining, workers' council or similar agreement to which Seller or any Transferred Subsidiary is a party, or to which Seller or any Transferred Subsidiary is subject as a matter of applicable Law, with respect to or relating to the Business.  Neither Seller nor any Transferred Subsidiary is (a) subject to a legal duty to bargain (exclusive of any notification and consultation obligations) with any trade union or workers' council on behalf of the Employees or (b) to the Knowledge of Seller, the object of any attempt to organize the Employees for collective bargaining purposes or presently operating under an expired collective bargaining agreement.  As of the Offer Date and within the four year period preceding the Offer Date, neither Seller nor any Transferred Subsidiary in respect of the Transferred Business is or has been a party to or subject to any pending strike, work stoppage, organizing attempt, picketing, boycott or similar activity. 

(b)             Section 5.14(b) of the Disclosure Letter contains a list (with names omitted where required by applicable local law) of all Employees or independent contractors employed or engaged by Seller and the Transferred Subsidiaries in the Transferred Business and whose base annual salary exceeds $100,000 per year or who are employed pursuant to any employment Contract (other than "at will" employment Contracts and Contracts arising as a matter of applicable Law), along with the position and the annual rate of compensation of each such person.  Each current or past Employee has entered into Seller's or the Transferred Subsidiaries' standard confidential information and invention assignment agreement with Seller or a Transferred Subsidiary, as the case may be.  Section 5.14(b) of the Disclosure Letter contains a list of all Employees employed in the United States who are not citizens of the United States.

(c)              On or before the date of this Agreement, (i) the formalities of information and consultation of the Workers' Council of Porgès have been duly fulfilled, and (ii) Seller has provided Buyer with a copy of the minutes of all the meetings of the Workers' Council of Porges held in this respect that were made available to Seller.

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5.15            Properties

(a)              Section 5.15(a) of the Disclosure Letter contains a list of all Leases to be assigned to Buyer in accordance with Article 2 (the "Assigned Leases") and all Leases held by the Transferred Subsidiaries (the "Subsidiary Leases", which, together with the Assigned Leases, the Transferred Real Property and the Subsidiary Real Property shall hereinafter be referred to as the "Real Property").  To the Knowledge of Seller, all facilities leased or subleased under any Assigned Lease or Subsidiary Lease are supplied with utilities and other services adequate for  the conduct of the Business at such facility as it is currently being conducted and all such facilities are provided legal access to public roads.

(b)               Neither Seller nor any of its Subsidiaries has received written notice that it is in default in any material respect under any Assigned Lease or Subsidiary Lease which notice has not been remedied or withdrawn, and, to the Knowledge of Seller, no other party to any Assigned Lease or Subsidiary Lease is default thereof in any material respect.  Each Assigned Lease and Subsidiary Lease is a valid and binding agreement of Seller or a Subsidiary of Seller, is in full force and effect and, to the Knowledge of Seller, is enforceable according to its terms, subject to the Enforceability Exceptions.

(c)                Seller or its Subsidiaries has good and valid title to the Transferred Real Property and the Subsidiary Real Property, subject to Permitted Encumbrances.  There are no pending or, to the Knowledge of Seller, threatened condemnation proceedings relating to the Transferred Real Property or the Subsidiary Real Property.  All facilities located on the Transferred Real Property and the Subsidiary Real Property are supplied with utilities and other services adequate for  the conduct of the Business at such facility as it is currently being conducted and all such facilities are provided legal access to public roads.  The improvements constructed on the Transferred Real Property and the Subsidiary Real Property are suitable for the conduct of the Business as it is currently being conducted. 

5.16             Environmental Matters

(a)                 No Environmental Condition exists with respect to the Transferred Business or the Transferred Assets that would constitute a violation in any material respect of any Environmental Laws or otherwise give rise to any material liability under any Environmental Laws.  Neither Seller nor any of its Subsidiaries has received any written notice, citation, summons, order or complaint, and no penalty has been assessed within the two-year period preceding the Offer Date or is pending or, to the Knowledge of Seller, threatened, by any third Person (including any Governmental Authority) with respect to the Management or Release of, or exposure to any Hazardous Substance by or on behalf of Seller (with respect to the Business) or any of its predecessors or in relation to its past or present conduct of the Business for which either the Seller or any of its Subsidiaries has any remaining material Liability.  Neither Seller nor any of its Subsidiaries has received and, to the Knowledge of Seller, no one else has received, any request for information, notice of claims, demand or other notification that it (or any of its predecessors with respect to the Business) is or may be potentially responsible with respect to any investigation, cleanup remedial action or other response action ("Remediation") of Hazardous Substances (whether on-site or off-site) in connection with the Business for which either the Seller or any of its Subsidiaries has any remaining material Liability.

(b)                 No Hazardous Substances have been Released by Seller or any Transferred Subsidiary or, to the Knowledge of Seller, by any other Person at any property now formerly owned, operated or leased by Seller or a Transferred Subsidiary in connection with the Business in such manner as would reasonably be expected to result in a material Liability to Seller or any of it Subsidiaries or require any Response Action.

(c)                 Section 5.16(c) of the Disclosure Letter contains a list of the Environmental Permits held by Seller and its Subsidiaries.

(d)                 No representations in this Article 5 other than this Section 5.16 shall apply to Liabilities and other matters respecting Environmental Claims, Environmental Conditions, Environmental Permits and the violation of Environmental Laws.

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5.17            Transferred Inventory

The Transferred Inventory has been maintained in the ordinary course of business, is of good and merchantable quality; and is in a condition that in Seller's reasonable judgment consistent with past practice is useable, leaseable or saleable in the ordinary course of business taking into account the remaining shelf life and expected demand, subject to the inventory reserve determined consistent with past practice for slow-moving, excess non-saleable or obsolete inventory as recorded on the Financial Statements in good faith in accordance with GAAP.  All Transferred Inventory, whether reflected on the Financial Statements or subsequently acquired, (a) is located on the Real Property described on Section 5.17 of the Disclosure Letter or is in consignment stock in the possession of Seller's customers or distributors in the ordinary course of business consistent with past practice and (b) has been acquired, developed or manufactured by Seller only in bona fide transactions entered into in the ordinary course of business.  Except as described in Section 5.17 of the Disclosure Letter, Seller has valid legal title to the Transferred Inventory free and clear of any consignments, Encumbrances, claims or charges other than Permitted Encumbrances. 

5.18            Accounts Receivable

Except as described on Section 5.18 of the Disclosure Letter, the accounts receivable balances shown on the Financial Statements represent actual amounts due and owing from bona fide sales and services transactions completed in accordance with the terms and provisions contained in the documents, if any, relating thereto.  The reserves for uncollectible accounts receivable reflected on the Financial Statements were established in accordance with GAAP in light of all the facts then known to Seller and Seller's historical methods and practices in establishing such reserves. 

5.19            Litigation

There is no action, suit, claim or proceeding of any nature with respect to the Business pending, or to the Knowledge of Seller, threatened, against Seller or any of its Subsidiaries, their respective assets, properties, rights (tangible or intangible) or any of their respective officers or directors.  There is no investigation or other proceeding with respect to the Business (excluding any routine inspections) pending or, to the Knowledge of Seller, threatened, against Seller or any of its Subsidiaries, any of their respective properties (tangible or intangible) or any of their officers or directors by or before any Governmental Authority.  No Governmental Authority has at any time challenged the legal right of Seller or any of its Subsidiaries to conduct the Business without restriction as presently or previously conducted. 

5.20            Products Liability

(a)                 Neither Seller nor any of its Subsidiaries has received any written notice with respect to any material pending claim involving any Product sold by or on behalf of Seller or any of its Subsidiaries resulting from an alleged defect in design, manufacture, materials, testing or workmanship, performance, or any alleged failure to warn, or from any alleged breach of warranty, express or implied, or any alleged noncompliance with any applicable Laws.

(b)                 Except as set forth in Section 5.20(b) of the Disclosure Letter, during the five (5) year period ending on the Offer Date there has been no recall or rework in the field or in the internal business or manufacturing processes, or post-sale warning or similar action (collectively, a "Recall") conducted by Seller or any of its Subsidiaries with respect to any Product sold by or on behalf of Seller or its Subsidiaries, and there are no facts or circumstances which are reasonably expected to lead to a Recall.

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5.21            Customers and Suppliers

(a)                 Section 5.21(a) of the Disclosure Letter sets forth the thirty (30) largest customers of Seller and its Subsidiaries relating to the Business by revenue for the fiscal year ended March 31, 2005.  As of the Offer Date, neither Seller nor any Transferred Subsidiary has received notification that any such customer of the Business intends to terminate or adversely change its relationship with Seller or any Transferred Subsidiary, as applicable, with respect to the Business.

(b)                 Section 5.21(b) of the Disclosure Letter sets forth (i) the twenty (20) largest suppliers to Seller and its Subsidiaries related to the Business for the fiscal year ended March 31, 2005, measured by the amount of payments made to such Persons in connection with the Business, (ii) all contract manufacturers used by Seller or its Subsidiaries in connection with the Business and (iii) any sole source suppliers of the Business.  As of the Offer Date, neither Seller nor any or any Transferred Subsidiary, as applicable, has received notification that any such supplier intends to terminate or adversely change its relationship with Seller or any Transferred Subsidiary, as applicable, with respect to the Business.

5.22            Compliance With Health Care Laws

(a)                 Neither Seller nor any of its Affiliates or Subsidiaries participate in the United States healthcare programs of Medicare, Medicaid, or their counterparts worldwide, or any other health care programs of a Governmental Authority, or third party payment programs in any jurisdiction (collectively, "Programs") and nor are they a party to participation agreements for payments by such Programs.

(b)                 Neither Seller nor any of its Affiliates or Subsidiaries has been the subject of any investigation by a Governmental Authority, whether in the United States or overseas, as a result of or in connection with Seller's or any of its Affiliates' or Subsidiary's pricing, production, distribution, marketing or sales activities related to the Products or related services. To Seller's Knowledge, Seller and each of its Affiliates and Subsidiaries have complied in all material respects with all applicable Laws regarding distribution, marketing and sales of Products and services.

(c)                 Seller and each of its Affiliates and Subsidiaries is, and at all times has been, in compliance with all relevant federal and other health care Laws applicable to the Business, including the federal Anti-kickback and Fraud and Abuse Prohibition Statutes (42 U.S.C. § 1320a‑7b) and to Seller's Knowledge all other Laws prohibiting false statements and improper remuneration for purchasing services or products, the civil False Claims Act (31 U.S.C. §§ 3729 et seq.), the administrative False Claims Law (42 U.S.C. § 1320a-7b(a)), the Health Insurance Portability and Accountability Act of 1996 (42 U.S.C. § 1301 et seq. and implementing regulations), the exclusion laws, SSA § 1128 (42 U.S.C. 1320a-7) and the regulations promulgated pursuant to such laws and regulations, relating to the regulation of the Business (collectively, "Health Care Laws"), except for failures of compliance that, individually or in the aggregate, have not or would not reasonably be expected to have a Seller Material Adverse Effect, and no change in the current conduct of the Business, or its internal procedures or processes, is required in order to so comply.

5.23            FDA and Global Regulation Compliance

(a)                 Seller and each of the Transferred Subsidiaries has obtained each federal, state, county, local or non-U.S. Business Permit (including all those that may be required by the Federal Food and Drug Administration (the "FDA") or any other Governmental Authority engaged in the regulation of the Products, the Business or the Business's manufacturing and other quality systems) that is required for or has been applied for in operating the Business in any location in which it is currently operated and all of such Business Permits are in full force and effect.  Section 5.23(a) of the Disclosure Letter lists all annual manufacturing registration and device listing, annual reports and similar regulatory filing requirements that are required to be filed within six months after the Offer Date in order to maintain Business Permits and manufacturing facility licenses and where failure to timely file would result in a Seller Material Adverse Effect.  Neither Seller nor any of the Transferred Subsidiaries has received any notice or written communication with respect to the Business from any Governmental Authority regarding, and, there are no facts or circumstances that are likely to give rise to, (i) any violation of applicable Law or material adverse change in any Business Permit, or any failure to materially comply with any applicable Law or any term or requirement of any Business Permit or (ii) any revocation, withdrawal, suspension, cancellation, limitation, termination or modification of any Business Permit.  No such Business Permit will be terminated or impaired, or will become terminable, in whole or in part, as a result of the consummation of the transactions contemplated by this Agreement.

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(b)                 The operation of the Business, including the manufacture, import, export, testing, development, processing, packaging, labeling, storage, marketing, and distribution of all Products, is and at all times has been in material compliance with all applicable Laws, Business Permits, Governmental Authorities and orders including those administered by the FDA for products sold in the United States.  There is no actual or, to the Knowledge of Seller, threatened material action or investigation in respect of the Business by the FDA or any other Governmental Authority which has jurisdiction over the operations, properties, products or processes of the Business or the Transferred Subsidiaries, or, to the Knowledge of Seller, by any third parties acting on their behalf.  Seller has no Knowledge that any Governmental Authority is considering such action or of any facts or circumstances that are likely to give rise to any such action or investigation.(c)                 Except as set forth in Section 5.23(c) of the Disclosure Letter, during the three (3) year period ending on the Offer Date, neither Seller nor any Transferred Subsidiary has had any product or manufacturing site subject to a Governmental Authority (including FDA) shutdown or import or export prohibition, nor received any FDA Form 483 or other Governmental Authority notice of inspectional observations, "warning letters," "untitled letters" or, to the Knowledge of Seller, requests or requirements to make changes to the operations of the Business or Products that if not complied with would reasonably be expected to result in a Seller Material Adverse Effect, or similar correspondence or written notice from the FDA or other Governmental Authority in respect of the Business and alleging or asserting noncompliance with any applicable Laws, Business Permits or such requests or requirements of a Governmental Authority, and, to the Knowledge of Seller, neither the FDA nor any Governmental Authority is considering such action.  Except as set forth in Section 5.23(c) of the Disclosure Letter, no vigilance report or medical device report with respect to the Business or the Products has been reported to Seller during the 90 day period ending on the Offer Date, and to the Knowledge of Seller, as of the Offer Date no vigilance report or medical device report is under investigation by any Governmental Authority with respect to the Products or the Business.

(d)                 All studies, tests and preclinical and clinical trials in respect of the Business being conducted by or on behalf of Seller or any Transferred Subsidiary that have been or will be submitted to any Governmental Authority, including the FDA and its counterparts worldwide, including in the European Union, in connection with any Business Permit, are being or have been conducted in compliance in all material respects with the required experimental protocols, procedures and controls pursuant to accepted professional scientific standards and applicable local, state, federal and foreign Laws, rules and regulations, including the applicable requirements of Good Laboratory Practices, Good Clinical Practices, Good Manufacturing Practices and the U.S. Food, Drug and Cosmetic Act of 1938 and its implementing regulations, including 21 CFR Parts 50, 54, 56, 58, and 812.  Neither Seller nor any Transferred Subsidiary has received any notices, correspondence or other communication in respect of the Business from the FDA or any other Governmental Authority requiring the termination or suspension of any clinical trials conducted by, or on behalf of, Seller or in which Seller has participated, and to the Knowledge of Seller neither the FDA nor any other Governmental Authority is considering such action.  During the six month period ending on the Offer Date, neither Seller nor any Transferred Subsidiary has received specific written notification from a Governmental Authority of the rejection of data obtained from any clinical trials conducted by, or on behalf of, Seller or in which Seller has participated with respect to the Business or Products, which data was submitted to the Governmental Authority and which was necessary to obtain regulatory approval of a particular Product.

(e)                 The manufacture of Products by, or on behalf of, Seller or any Transferred Subsidiary is being conducted in compliance in all material respects with all applicable Laws including the FDA's Quality Systems Regulation at 21 CFR Part 820 for products sold in the United States, and the respective counterparts thereof promulgated by Governmental Authorities in countries outside the United States.  Seller and each of the Transferred Subsidiaries, and, to the Knowledge of Seller, any third party assembler, sterilizer or manufacturer of Products, components or accessories, are in material compliance with all applicable Laws and certifications currently held by Seller governing quality systems, manufacturing processes and all other quality standards, registration and listing requirements governing those third parties' activities, including set forth in 21 CFR Part 807 and 21 CFR Part 820 for products sold in the United States and all other similar applicable Laws.

(f)                  Neither Seller nor any of the Transferred Subsidiaries is the subject of any pending or, to the Knowledge of Seller, threatened investigation in respect of the Business by the FDA pursuant to its "Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities" Final Policy set forth in 56 Fed. Reg. 46191 (September 10, 1991) and any amendments thereto.  Neither Seller nor any of its Transferred Subsidiaries has committed any act, made any statement, or failed to make any statement, in each case in respect of the Business and that would provide a basis for the FDA to invoke its policy with respect to "Fraud, Untrue Statements of Material Facts, Bribery and Illegal Gratuities" and any amendments thereto.  Neither Seller nor any of the Transferred Subsidiaries or any of their respective officers, Employees or agents has been convicted of any crime or engaged in any conduct that could result in a material debarment or exclusion (i) under 21 U.S.C. Section 335a, or (ii) any similar applicable state Law.  To the Knowledge of Seller, no debarment or exclusionary claims, actions, proceedings or investigations in respect of the Business are pending or threatened against Seller, any of the Transferred Subsidiaries or any of their respective officers, employees or agents, except for such debarments, claims, actions, proceedings or investigations that, individually or in the aggregate, have not or would not reasonably be expected to have a Seller Material Adverse Effect.

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5.24            Restrictions on Business Activities

There is no Contract or commitment to which Seller or any Transferred Subsidiary is a party or by which they are bound limiting or restricting in any material respect the right of Seller or any Transferred Subsidiary to engage in any line of business relating to the Business or to compete without restriction with any Person, in each case which would or could be reasonably expected to apply to the activities of Buyer after the Closing with respect to the Business.

5.25            Sufficiency

The Transferred Assets and the Transferred IPR, and the assets of the Transferred Subsidiaries (other than Excluded Assets) acquired by Buyer as a matter of law as a result of Buyer's acquisition of the Transferred Equity Interests and any rights or licenses granted or services provided pursuant to any other commitment or Contract entered into pursuant to this Agreement (subject to the limitations therein and in the related exhibits thereto), constitute all the assets, properties, interests in properties, and rights owned or licensable by Seller or its Subsidiaries and used or necessary to conduct the Business after the Closing as currently conducted. 

5.26            Exclusive Warranties

Except for the express representations and warranties set forth in this Agreement, neither Seller nor any of its Subsidiaries makes any representation or warranty, express or implied, with respect to the Transferred Assets, the Transferred IPR and the Assumed Liabilities, which are being sold "AS IS" in all respects with all faults and without any other warranties of any kind.  EXCEPT AS SPECIFICALLY CONTAINED HEREIN, SELLER EXPRESSLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY, NON‑INFRINGEMENT, VALIDITY, ENFORCEABILITY, OR SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF BUYER'S, WHETHER OR NOT SELLER HAS BEEN MADE AWARE OF ANY SUCH PURPOSE.

5.27            Insurance

Section 5.27 of the Disclosure Letter lists all insurance policies reasonably related to the Transferred Business.  All premiums due and payable under all such policies have been paid, and Seller is otherwise in material compliance with the terms of such policies (or other policies providing substantially similar insurance coverage). Seller does not have Knowledge of the threatened termination of, or a material increase in premium with respect to, any of such policies.

5.28            Compliance with Conduct of Business Covenant

During the period from the Offer Date until the date of this Agreement, Seller has conducted, and has caused each of its Subsidiaries to conduct, the Business in a manner that does not violate the covenants set forth in Section 8.2 hereof.

Article 6

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby makes the following representations and warranties to Seller as of the Offer Date:

6.1                Organization of Buyer

Buyer is a duly incorporated and validly existing corporation in good standing under the Laws of Denmark, with all requisite power and authority to own its properties and conduct its business, including the discharge of its obligations with respect to the Assumed Liabilities, and is duly qualified in each jurisdiction in which its ownership of property, including the Transferred Assets, and its conduct of business, including the performance of the Assumed Liabilities, requires such qualification, except where the failure to so qualify would not, individually, or in the aggregate, be reasonably likely to have a material adverse effect on Buyer.

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6.2                Authorization

Buyer has the requisite power and authority to execute and deliver this Agreement and each of the other Operative Agreements to which it is a party, and to perform its obligations hereunder and thereunder.  This Agreement has been, and each of the other Operative Agreements to which it or a Buyer Subsidiary is a party will be, upon their execution and delivery, duly and validly authorized, executed and delivered by Buyer and/or any Buyer Subsidiary, and this Agreement constitutes, and each of the other Operative Agreements to which it and/or any Buyer Subsidiary is a party will constitute, the valid and binding agreement of Buyer and/or such Buyer Subsidiary enforceable against Buyer and/or such Buyer Subsidiary in accordance with its respective terms, subject to the Enforceability Exceptions.  No other actions or proceedings on the part of Buyer are necessary to authorize Buyer's execution or performance of this Agreement or any of the Operative Agreements to which it is a party or the transactions contemplated hereby or thereby.

6.3                No Violation

The execution and delivery by Buyer of this Agreement and each of the other Operative Agreements to which it is a party does not, and the performance by Buyer of its respective obligations hereunder and thereunder will not: (a) conflict with, or result in a breach of, any of the provisions of its charter documents or bylaws; (b) materially breach, violate or contravene any applicable Laws; (c) be prevented or delayed as a result of a breach of the UK OFT Undertakings; or (d) conflict in any material respect with, or result in a material breach of or default under, any material Contract to which Buyer is a party or by which Buyer or any of its properties may be affected or bound.

6.4                Government Consents

No material Governmental Actions on the part of Buyer are required in connection with the execution or delivery by Buyer of this Agreement or any of the other Operative Agreements or the consummation by Buyer of the transactions contemplated hereby or thereby, other than pursuant to HSR and such Governmental Actions set forth on Schedule 9.3.

6.5                Purchase for Investment; Accredited Investor

Buyer is aware that the Transferred Equity Interests were not registered under the Securities Act, or any other applicable securities Laws, and were issued pursuant to exemptions therefrom.  Buyer is purchasing the Transferred Equity Interests solely for investment, with no present intention to distribute any Transferred Equity Interests to any Person, and Buyer will not sell or otherwise dispose of any Transferred Equity Interests except in compliance with the registration requirements or exemption provisions under the Securities Act and the rules and regulations promulgated thereunder, or any other applicable securities Laws.  Buyer has substantial experience in evaluating and investing in securities in companies similar to the Transferred Subsidiaries and acknowledges that it can protect its own interests.  Buyer has such knowledge and experience in financial and business matters so that it is capable of evaluating the merits and risks of its acquisition of the Transferred Equity Interests.  Buyer is an "accredited investor" within the meaning of Rule 501(a) of Regulation D, promulgated by the Securities and Exchange Commission under the Securities Act.

6.6                No Broker

None of Buyer or any Subsidiary of Buyer, has engaged any Person, other than J.P. Morgan Chase & Co. (the fees of which shall be paid by Buyer), which is entitled to any fee or commission as a finder or a broker in connection with this Agreement or the transactions contemplated hereby.

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6.7                Financing

Buyer has available, and will have available on the Closing Date, sufficient funds to enable it to consummate the transactions contemplated hereby and by the other Operative Agreements.

6.8                Litigation

There is no action, suit, claim or proceeding of any nature pending, or to the Knowledge of Buyer, threatened against Buyer or any of its Subsidiaries, their respective assets, properties, rights (tangible or intangible) or any of their respective officers or directors that, individually or in the aggregate, has had or is reasonably likely to have a Buyer Material Adverse Effect, nor to the Knowledge of Buyer is there any reasonable basis therefor.  Buyer is not subject to any order, judgment, consent decree, settlement agreement or other Contract that would reasonably be expected to result in a Buyer Material Adverse Effect.

Article 7

EMPLOYEE TRANSFERS AND BENEFITS

7.1                Voluntary Transfer Employees

(a)                 Offers of Employment.  On a date or dates to be mutually agreed upon by Purchaser and Seller, which shall be no later than the tenth (10th) Business Day after Seller delivers Schedule 7.1(a) to Buyer, Buyer will extend an offer of employment to (i) each Employee on Seller's U.S. payroll and listed on Schedule 7.1(a) (each, a "U.S. Employee") and (ii) each Employee who is not on Seller's U.S. payroll or employed by a Transferred Subsidiary and who is listed on Schedule 7.1(a) ((i) and (ii) collectively, the "Offered Employees").  The employment of each Employee who is employed by a Transferred Subsidiary (each a "Transferred Subsidiary Employee") will continue uninterrupted at Closing without the Buyer extending an offer of employment. Each such offer shall provide for employment by Buyer effective only as of and after the Closing Date and at a job responsibility level and title that is substantially similar to or higher than such Offered Employee's employment with Seller for the year prior to the date of the offer.  Effective only as of the Closing and after the Closing Date, Buyer will hire each Offered Employee who accepts the offer of employment extended to such individual by Buyer.  Notwithstanding the foregoing, any U.S. Employee who is, at the time an offer of employment is required under this Section 7.1(a), on a Seller (or a Subsidiary thereof) approved leave of absence from work, shall not become an employee of Buyer (and shall not be considered a Transferred Employee) unless and until such employee becomes eligible to return to active employment within one year after the Closing Date in accordance with Seller's human resource policies and applicable Laws and is accepted for employment by Buyer in its discretion and actually commences employment with Buyer.

(b)                 Service Credit; Waivers; Credits.  As soon as reasonably practicable following the Closing, Seller shall provide Buyer with a certificate of creditable coverage under HIPAA for all U.S. Transferred Employees.  Buyer shall provide each Transferred Employee with credit for purposes of eligibility, vesting and benefit accrual (other than under a defined benefit plan intended to benefit Employees located in the U.S.) under the Buyer Benefits Plans for Years of Service on and prior to the Closing Date with Seller and its Subsidiaries credited under the comparable Seller Benefits Plans, including recognition of such service for purposes of determining Transferred Employees' amount of paid time off or vacation and severance benefits; provided, however, that in no event shall Buyer be required to provide any service credit to any Transferred Employee to the extent the provision of such credit would result in any duplication of benefits.  To the extent permitted by applicable Law, Buyer shall cause any pre‑existing conditions or limitations and eligibility waiting periods (to the extent that such waiting periods would be inapplicable under Seller Benefits Plans) under any Buyer Benefits Plans to be waived with respect to Transferred Employees and their eligible dependents.  To the extent permitted by applicable Law, Buyer shall provide the Transferred Employees and their eligible dependents with credit for any deductibles and annual out‑of‑pocket limits for medical, dental and vision expenses paid during the applicable period under any Seller Benefits Plans in satisfying any deductibles and annual out‑of‑pocket limits for medical, dental and vision expenses for the corresponding period under the Buyer Benefits Plans.

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(c)                 401(k) Plan.  To the extent permitted under Section 401(k) of the Code and regulations issued thereunder, Voluntary Transfer Employees who participate in Seller's 401(k) plan shall be eligible to receive, at their election, a distribution of their account balance from Seller's 401(k) plan after the Closing Date.  Buyer shall use reasonable efforts to cause its 401(k) plan to accept eligible rollovers of such distributions, provided that Buyer determines that receipt of any such rollover will not result in a disqualification of Buyer's 401(k) plan.  Rollovers relating to any Voluntary Transfer Employee may include participant loans.

(d)                 FSA.  Promptly after the Closing Date, Seller shall transfer and Buyer shall accept the flexible spending account elections, liabilities and accounts (maintained pursuant to Code Sections 105 and 129) of the Voluntary Transfer Employees under Seller's Section 125 plan flexible spending arrangement.  Promptly after the Closing Date, Seller shall cause to be transferred to Buyer the aggregate net cash amount (determined immediately prior to the Closing) for contributions paid (but not yet reimbursed) by or on behalf of the Voluntary Transfer Employees under Seller's Section 125 plan flexible spending arrangement.

(e)                 Vacation.  Seller shall allow Transferred Employees to transfer any accrued but unused vacation time (which vacation time was accrued in accordance with Seller's policies consistent with past practice) to Buyer.   With respect to Voluntary Transfer Employees, only those Voluntary Transfer Employees who submit a vacation consent form, prior to the Closing Date, are eligible to transfer vacation time to Buyer.  To the extent permitted by Law, Buyer shall assume such accrued but unused vacation time of the Transferred Employees and allow each Transferred Employee to use such accrued vacation time after the Closing Date.  The transfer of vacation time shall not affect each Transferred Employee's accrual of vacation under Buyer's vacation policies.  Seller shall be liable for and pay in cash an amount equal to any accrued but unused vacation time to any (i) Voluntary Transfer Employee who has not executed a vacation consent form or (ii) any Offered Employee who declines to accept Buyer's offer of employment made in accordance with Section 7.1(a) and whose employment terminates prior to the Closing Date.

7.2                Automatic Transfer

(a)                 Transfer of Obligations.  Immediately upon the Closing Date, all rights, powers and Liabilities of Seller and its Subsidiaries to, or in respect of, the Automatic Transfer Employees (including the rights, powers and Liabilities under, in connection with or arising from a Contract of employment or employment relationship between an Automatic Transfer Employee and Seller or a Subsidiary of Seller) in force immediately prior to the Closing Date shall be transferred to Buyer upon Closing in accordance with applicable Laws.  Buyer and Seller agree to fully and timely comply with all applicable provisions of the European Union Acquired Rights Directive and other similar country‑specific legal standards or applicable Laws.

(b)                 Retirement Benefits.  With respect to Automatic Transfer Employees only and subject to the requirements of applicable Laws, Buyer and Seller agree as follows:

(i)            Except to the extent that applicable local Law requires more favorable benefits to be provided, Buyer shall provide Retirement Benefits in respect of service with Buyer following the Closing, which are substantially similar to the benefits provided for or in respect of Automatic Transfer Employees under Seller Retirement Plans immediately prior to the Closing;

(ii)            Subject only to the requirements of local Law in the relevant jurisdiction, Buyer shall not assume any accrued Retirement Benefits liabilities relating to the Automatic Transfer Employees in respect of their Years of Service prior to the Closing.  If Buyer is required by local Law or the terms of any existing Seller Retirement Plan to assume any accrued Retirement Benefits liabilities relating to the Automatic Transfer Employees in respect of their Years of Service prior to the Closing, and provided the assets associated with such liabilities are retained by Seller (or a Subsidiary thereof) at the Closing, Seller will treat all such Retirement Benefits liabilities as Excluded Liabilities and, to the extent required by the terms of the applicable Seller Retirement Plan and applicable Law, shall pay all such benefits as and when they become payable; and

(iii)            Years of Service in respect of the Automatic Transfer Employees under any Seller Retirement Plan shall count as Years of Service under any relevant retirement benefit arrangement operated or nominated by Buyer for the purpose of vesting, eligibility for benefits, early retirement or termination subsidies, levels of contribution and, subject to Section 7.1(b) (relating to non‑duplication of benefits) and Section 7.2(b)(i), benefit accrual.

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7.3                Compensation and Benefits

Buyer will compensate each Transferred Employee (so long as any such Transferred Employee remains employed by Buyer or an Affiliate thereof, and subject to Buyer's termination rights and resulting severance obligations under Section 7.5) for at least one year after the Closing as follows:

(a)                 at a rate of total cash compensation, including base salary rate and target bonus opportunity, which shall be at least substantially similar in the aggregate to the total cash compensation opportunity provided to the Transferred Employee by Seller immediately prior to the date of this Agreement; and

(b)                 with Employee Benefits Plans (excluding stock-based incentive plans and employee stock purchase or stock option plans) that are at least substantially similar in the aggregate to the benefits provided under those Seller Benefits Plans in effect immediately prior to the Closing Date.

(c)                 Notwithstanding anything to the contrary, any and all "stay", "retention", or incentive bonus(es) offered by Seller to its Employees, and regardless of when payable, shall be the sole and exclusive responsibility of Seller, and Buyer shall have no responsibility or liability therefor.

7.4                Information and Consultation

Buyer and Seller shall provide one another with such information, which information will be materially accurate and complete, and assistance at such times as either Party may reasonably request or as may be necessary for such Party or its Subsidiaries to comply with any requirement to consult with the Employees, a relevant trade union, or any other Employee representatives.

7.5                Severance

(a)                 Buyer shall provide any Transferred Employee whose employment is terminated by Buyer (other than employees terminated (a) for Cause or (b) by reason of such employee's Poor Performance) or who resigns as a result of a Constructive Termination, in each case within the 12‑month period immediately following the Closing Date, with severance payments and benefits, which are no less favorable than the severance pay and benefits such employee would have received had he or she terminated employment with Seller on the Closing Date. 

(b)                 Buyer and Seller agree to share equally the cost of the severance obligations owed to Shared Benefit Employees.

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7.6                Employment‑Related Assumed Liabilities

Buyer, to the exclusion of Seller, assumes, accepts and shall be fully responsible for any and all Losses, Liabilities or claims to the extent arising out of or relating to: (a) any Transferred Subsidiary Employee; (b) any Voluntary Transfer Employee employed by Mentor Benelux B.V.; (c) Buyer's alleged failure to make offers of employment to Offered Employees in keeping with its obligations under Section 7.1(a); (d) Buyer's employment of, or the termination of employment of any Transferred Employee, in each case only on or after the Closing Date; (e) any Buyer Benefits Plans; and (f) workers' compensation claims of any Voluntary Transfer Employee arising out of conditions with a date of injury (or, in the case of a claim relating to occupational illness or disease, the last significant exposure) that begins prior to but continues after the Closing Date (collectively referred to herein as "Buyer Employment Liabilities").  Notwithstanding the preceding sentence, Buyer shall retain responsibility for and continue to pay all medical, life insurance, disability and other welfare plan expenses and benefits for each Transferred Employee with respect to claims incurred by such Transferred Employees or their covered dependents on or after the Closing Date.  Buyer shall reimburse, indemnify and hold harmless each of the Seller Indemnified Parties and their respective Employee Benefits Plans from and against any and all Losses incurred by any of them in connection with any Buyer Employment Liabilities.  All Buyer Employment Liabilities shall be Assumed Liabilities for all purposes of this Agreement.

7.7                Employment-Related Excluded Liabilities

Seller, to the exclusion of Buyer, assumes, accepts and shall be fully responsible for any and all Losses, Liabilities or claims to the extent arising out of or relating to: (a) the employer-employee relationship, or Seller's employment or termination of employment, of any Transferred Employee, former Employee, any consultant or independent contractor, in each case, on or before the Closing Date; (b) any Seller Benefits Plans other than Foreign Benefit Plans; and (c) workers compensation claims of Voluntary Transfer Employees arising out of conditions with a date of injury, (or in the case of a claim relating to occupational illness or disease, the last significant exposure) that begins and ends on or before the Closing Date (collectively referred to herein as "Seller Employment Liabilities").  Notwithstanding the preceding sentence, Seller shall retain responsibility for and continue to pay all medical, life insurance, disability and other welfare plan expenses and benefits for each Transferred Employee with respect to claims incurred by such Transferred Employees or their covered dependents prior to the Closing Date.  Seller shall reimburse, indemnify and hold harmless each of the Buyer Indemnified Parties and their respective Employee Benefits Plans from and against any and all Losses whenever asserted or incurred by any of them in connection with any Seller Employment Liabilities.  All Seller Employment Liabilities shall be Excluded Liabilities for all purposes of this Agreement.

7.8                Timing of Claims Incurred

For purposes of Section 7.6 and Section 7.7, a claim is deemed incurred when all facts and circumstances giving rise to the claim have occurred and specifically: in the case of medical or dental benefits, when the services that are the subject of the claim are performed; in the case of life insurance, when the death occurs; in the case of long term disability benefits, when the disability occurs; in the case of workers compensation benefits, as described in Section 7.6 and Section 7.7 above; and otherwise, at the time the Transferred Employee or covered dependent becomes entitled to payment of a benefit (assuming that all procedural requirements are satisfied and claims applications properly and timely completed and submitted).

7.9                Retention Payment

Within thirty (30) days after the Closing Date, Seller agrees to pay to each Transferred Employee who holds options exercisable for shares of Seller's common stock as of the Closing Date (the "Eligible Employees") one-half (1/2) of the Retention Payment for such Eligible Employee, less any applicable required withholdings.  Upon the first (1st) anniversary of the Closing Date, Buyer shall pay to each Eligible Employee then employed by Buyer or any of Buyer's Subsidiaries or Affiliates one-half (1/2) of the Retention Payment, less any applicable required withholdings.  If after the Closing Date and prior to the first (1st) anniversary of the Closing Date, the employment of any Eligible Employee is terminated (a) by the Buyer other than for Cause or Poor Performance or (b) as a result of a Constructive Termination, death or disability, Buyer shall pay to such terminated Eligible Employee one-half (1/2) of the Retention Payment within thirty (30) days after the date of such termination, less any applicable required withholdings.  No Eligible Employee shall otherwise be entitled to any Retention Payment if such Eligible Employee resigns or terminates his or her employment for any reason other than those set forth in the foregoing sentence.  "Retention Payment" means, for each Eligible Employee, an amount of cash equal to the difference between (A) the product of (x) the average closing price of Seller's common stock on the five (5) trading days preceding (but not including) the Closing Date multiplied by (y) the number of unvested stock options issued by Seller and held by an Eligible Employee as of the Closing Date, less (B) the total aggregate exercise price of all such stock options referred to in clause (y) above. 

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Article 8

ADDITIONAL COVENANTS

8.1                Contracts

Beginning on the date hereof and ending 90 days following the Closing Date, each Party shall, and shall cause its respective Subsidiaries to, use commercially reasonable efforts to obtain, as soon as practicable, all Consensual Transfers and the Subsidiary Consents.  Anything in this Agreement to the contrary notwithstanding, nothing in this Agreement shall constitute an agreement to assign any Transferred Contract or any claim, right or benefit arising thereunder or resulting therefrom if the failure to obtain any Consensual Transfer with respect thereto would (i) constitute a breach of or other contravention thereof, (ii) be ineffective with respect to any party thereto, or (iii) in any way adversely affect the rights of Buyer or Seller, or their respective Subsidiaries, thereunder.  Pending receipt of such Consensual Transfers and for a period not to exceed three (3) years after the Closing Date, the Parties shall cooperate with each other to the extent practicable in establishing mutually agreeable, reasonable and lawful arrangements designed to provide to Buyer the benefits of use of such asset and to provide to Seller or a Subsidiary of Seller, as the case may be, the benefits that they would have obtained had the asset been conveyed to Buyer at the Closing.  To the extent that Buyer is provided the benefits pursuant to this Section 8.1 of any Contract, Buyer shall perform for the benefit of the other parties thereto the obligations of Seller or a Subsidiary of Seller, as the case may be, thereunder and pay, discharge and satisfy any related Liabilities that, but for the lack of a Consensual Transfer, would be Assumed Liabilities.  If, with respect to any Consensual Transfers, there is any financial cost to obtaining such consent, waiver, confirmation, novation or approval, then Seller shall bear such financial costs and any payment thereof.  In addition, Buyer shall reimburse, indemnify and hold harmless each of the Seller Indemnified Parties from and against any and all Losses incurred by it in connection with the good faith performance by Seller or any of it Subsidiaries of the obligations under (including any payment or incurrence of Liabilities by Seller or any of its Subsidiaries) those Contracts for which Buyer is provided the benefits pursuant to this Section 8.1.  If and to the extent that a Consensual Transfer is obtained after the Closing Date, the Contract for which such Consensual Transfer was obtained shall thereafter constitute a Transferred Asset and an Assumed Liability for all purposes under this Agreement.  Notwithstanding the foregoing, to the extent that any consents, novations or transfers applicable to the Transferred Assets, the Transferred IPR or the Assumed Liabilities are expressly addressed in the other Operative Agreements, such other provision shall be controlling and this Section 8.1 shall be deemed to apply only to the extent consistent with the intent of such other provision.

8.2                Conduct of the Business

(a)                 Except as set forth in Schedule 8.2(a), during the period from the date hereof and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, Seller shall, and shall cause each of its Subsidiaries to, except to the extent that Buyer shall otherwise consent in writing (such consent to not be unreasonably withheld, delayed or conditioned), use its commercially reasonable efforts to carry on the Business in all material respects in the ordinary course, and in compliance in all material respects with all applicable Laws, and to pay or perform the obligations of the Business when due.

(b)                 Without limiting the generality of Section 8.2(a), except as permitted or required by the terms of any other Operative Agreement or as provided in Schedule 8.2(b), without the prior written consent of Buyer (such consent to not be unreasonably withheld, delayed or conditioned), during the period from the date hereof and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, Seller shall not do any of the following, and shall cause its Subsidiaries not to do any of the following:

(i)            except as required by applicable Laws or pursuant to written agreements in effect or written policies existing on the date hereof, (A) grant any material severance or termination pay to any Transferred Employee, (B) change the compensation payable to any Transferred Employee other than in the ordinary course, or (C) make any material change in any Employee Benefits Plan that by reason of this Agreement or applicable Law would reasonably be expected to increase, in any material respect, the liabilities of Buyer, except for such changes that are intended to apply to a population of employees of Seller and/or its Subsidiaries that is not limited to Transferred Employees;

(ii)            (A) hire any new employee at an annual base salary of over $100,000, which employee would become a Transferred Employee at Closing, (B) terminate the employment of any employee whose annual base salary as of the date hereof is over $100,000, if such employee would otherwise become a Transferred Employee at Closing;

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(iii)            enter into any collective bargaining or labor Contract;

(iv)            enter into any Contract or assignment which has the effect of transferring or licensing to any Person or otherwise extending, amending or modifying in any material respect any Transferred IPR, unless incidental to ordinary course commercial transactions and, in the case of distribution agreements, which are terminable within a reasonable period of time;

(v)            except as required by GAAP or the SEC, revalue any of the Transferred Assets in any material respect or make any change in accounting methods, principles or practices in any material respect applicable to the Transferred Assets;

(vi)            write down or write up the value of any Transferred Inventory, or determine as collectible any Transferred Accounts Receivable or any part thereof which were previously considered uncollectible, or write off as uncollectible any Transferred Accounts Receivable or any part thereof, except in each case for write downs, write ups, and write offs in the ordinary course of business consistent with past practice;

(vii)            pay, discharge or satisfy any claim, Encumbrance, obligation or Liability of the Business, other than (A) Permitted Encumbrances, (B) the payment, discharge or satisfaction of claims, Encumbrances, obligations or liabilities reflected or reserved against in the Most Recent Balance Sheet or (C) in the ordinary course of business;

(viii)            other than in the ordinary course of the Business or sale of inventory in the ordinary course, dispose of any Transferred Assets;

(ix)            create any Encumbrance on (a) any of the Transferred Assets other than a Permitted Encumbrance or (b) any of the Transferred IPR unless in or incidental to ordinary course commercial transactions;

(x)            enter into any Contract with respect to the Business that would either: (a) by its terms expressly require a non-cancellable payment by Seller or any of its Subsidiaries of more than $250,000 per year; or (b) be reasonably likely to cause a Seller Material Adverse Effect;

(xi)            fail to maintain or prosecute any IPR that would be Transferred IPR but for the failure to maintain or prosecute such IPR, other than in the ordinary course of Business;

(xii)            disclose any Transferred Trade Secrets or other confidential information constituting Transferred IPR to Persons not bound by confidentiality obligations;

(xiii)            voluntarily terminate or materially modify any Transferred Contract or Subsidiary Contract; or

(xiv)            agree in writing or otherwise to take any of the actions described in Sections 8.2(b)(i) through 8.2(b)(xiii) above.

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8.3                Access to Information

Except as may be necessary or appropriate to ensure compliance with respect to any applicable Laws and subject to any confidentiality obligations or applicable privileges (including privacy obligations under relevant employment law and attorney-client privilege), from the date of this Agreement until the Closing Date, Seller will (a) give Buyer and its authorized representatives access to financial and operating data and other information relating to the Transferred Business during normal business hours and upon reasonable prior notice, (b) give Buyer and its authorized representatives reasonable access to key employees of the Business, the identities of whom and the procedures and scope of which access to be mutually agreed upon by the Parties, (c) furnish to Buyer and its authorized representatives such financial and operating data and other information relating to the Transferred Business as Buyer may reasonably request, and (c) will instruct the Seller Representatives to cooperate with Buyer in its investigation of the Transferred Business, all for the purpose of enabling Buyer and its authorized representatives to conduct, at their own expense, legal, business and financial reviews, investigations and studies of the Transferred Business in connection with this Agreement and the transactions contemplated hereby; provided, however, that notwithstanding the foregoing, Seller shall not be required to provide any financial, operating data or other information that is not currently available through Seller's existing business processes or the creation of which would be unduly burdensome on Seller.  Notwithstanding the foregoing or any other provision of any other Operative Agreement, Buyer shall not have access to such price and other competitive information as may invoke antitrust or similar legal restrictions, as determined by Seller in its reasonable judgment.  Any access to Seller's Real Property shall be subject to Seller's reasonable security measures and insurance requirements and shall not include the right to perform any "invasive" testing.

8.4                Books and Records

For a period of six (6) years from the Closing Date, or for such longer period as is required by applicable Laws, Buyer will permit Seller or its authorized representatives reasonable access, at Seller's expense, to information relating to the Transferred Business to the extent required by Seller to permit it to determine any matter relating to its rights and obligations under the Operative Agreements and its compliance with applicable Tax and financial reporting requirements, and any claim asserted in connection with an Assumed Liability.

8.5                Necessary Efforts; HSR Filings

(a)                 Seller and its Subsidiaries and Buyer and its Subsidiaries agree to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Operative Agreements and to cause the conditions to each party's obligation to close the transactions contemplated hereby to be satisfied, including all actions necessary to obtain all licenses, certificates, permits, approvals, clearances, expirations or terminations of applicable waiting periods, authorizations, qualifications and orders, and including, for the avoidance of doubt, any actions necessary to ensure compliance with the UK OFT Undertakings (each a "Consent") of any Governmental Authority required for the satisfaction of the conditions set forth in Section 9.3 or Section 10.3, and necessary in connection with the consummation of the transactions contemplated by the Operative Agreements.  Each of Seller and its Subsidiaries and Buyer and its Subsidiaries agree that (i) no contact will be initiated with, or Consent sought from, any Governmental Authority prior to the Closing Date without the written consent of the other Party (such consent not to be unreasonably withheld, delayed or conditioned) other than with respect to antitrust or merger control matters, and (ii) each Party will be given prior notice of and a reasonable opportunity to consult with the other Party regarding contacts with Governmental Authorities regarding antitrust or merger control matters.  The Parties hereto shall cooperate fully with each other to the extent necessary in connection with the foregoing.

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(b)                 Buyer and Seller shall timely and promptly make all filings or submissions which may be required for the satisfaction of the condition set forth in Section 9.3 or Section 10.3 by each of them in connection with the consummation of the transactions contemplated hereby.  In furtherance and not in limitation of the foregoing, each of Seller and Buyer shall file notification and report forms under HSR or any other similar antitrust or merger control filings under applicable Laws as promptly as practicable following the date of this Agreement and in any event no later than (i) 10 Business Days following the date of this Agreement, in the case of notification and report forms under HSR, and (ii) the time prescribed by applicable Law in the case of requirements under other applicable antitrust or merger control Laws.  In addition, Buyer and Seller agree, and shall cause each of its Subsidiaries, as applicable, to cooperate and to use all necessary efforts and take all actions necessary to: obtain any Consents required for the Closing, including through compliance with HSR and any other applicable Laws, to respond to any requests for information from any Governmental Authority, and notwithstanding Section 8.5(c) below, to avoid and/or overcome any action, including any legislative, administrative or judicial action, and to have vacated, lifted, reversed or overturned any judgment, injunction or other order (whether temporary, preliminary or permanent) that restricts, prevents or prohibits, or could restrict, prevent or prohibit, the consummation of the transactions contemplated by this Agreement.  Without limiting the foregoing, Buyer and its Subsidiaries shall agree to divest, license, hold separate (through the establishment of a trust or otherwise) or otherwise dispose, or agree to dispose of assets as, or if, required to avoid or overcome the objections of any Governmental Authority (each, a "Remedial Action"); provided, however, that notwithstanding the foregoing, and, for the avoidance of doubt, with the exception of Remedial Action in respect of the UK OFT Undertakings (which is dealt with separately in Section 8.5(d) below), nothing contained in this Agreement shall be deemed to require Buyer or any of its Subsidiaries to take or agree to take any such action if such action would be reasonably likely to have a Buyer Material Adverse Effect on a combined basis with the Transferred Subsidiaries after the Closing.  Each party shall furnish to the other such necessary information and assistance as the other party may reasonably request in connection with the preparation of any necessary filings or submissions by it to any Governmental Authority.  Except as prohibited or restricted by Law, each party or its attorneys shall provide the other party or its attorneys the opportunity to make copies of all correspondence, filings or communications (or memoranda setting forth the substance thereof) between such party or its representatives, on the one hand, and any Governmental Authority, on the other hand, with respect to this Agreement, the other Operative Agreements or the transactions contemplated hereby or thereby.  Without in any way limiting the foregoing, the Parties will consult and cooperate with one another, and consider in good faith the views of one another, in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any party hereto in connection with proceedings under or relating to HSR or other antitrust or merger control Laws.

(c)                 Each of Buyer and Seller shall notify and keep the other advised as to (i) any material communication from the Federal Trade Commission (the "FTC"), the Antitrust Division of the United States Department of Justice (the "DOJ") or any other Governmental Authority regarding any of the transactions contemplated hereby, including, for the avoidance of doubt, any communications with the UK Competition Authorities in relation to the UK OFT Undertakings, (ii) any litigation or administrative proceeding pending and known to such party, or to its knowledge threatened, which challenges, or would challenge, the transactions contemplated hereby and (iii) any event or circumstance which, to its knowledge, would constitute a Warranty Breach; provided, however, that the failure of Seller or Buyer to comply with this Section 8.5(c) shall not subject Seller or Buyer to any Liability hereunder in respect of any claim asserted after the relevant expiration date for the relevant representation or warranty; and provided further, that neither Buyer nor Seller may separately recover pursuant to Article 11 or otherwise for both a breach of this Section 8.5(c) and any Warranty Breach.  Subject to the provisions of Article 11, Seller and Buyer shall not take any action inconsistent with their obligations under this Agreement or, without prejudice to Buyer's rights under this Agreement, which would materially hinder or delay the consummation of the transactions contemplated by this Agreement.

(d)                 Buyer shall timely and promptly take all action necessary to ensure that the UK OFT Undertakings do not prevent or delay the consummation of the transactions contemplated by this Agreement, including taking all and any Remedial Actions or other steps required by the UK Competition Authorities.

8.6                Taxes and Costs Relating to the Porges Asset Sale

(a)                 Notwithstanding any other provision of this Agreement, Buyer shall indemnify Seller and hold Seller harmless from and against any Liability for Taxes (including, without limitation, withholding and Transfer Taxes) and all costs (including third-party costs) incurred by Porges in connection with the Porges Asset Sale.

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(b)                 Buyer shall also pay to Seller the following additional amounts: (i) 90% of the amount of foreign tax credits attributable to the Porges Asset Sale (such foreign tax credits, for purposes of this Agreement, shall be $7,875,000) (the "FTC Amount") that are determined to be unavailable to Seller following an audit of Seller or the promulgation of Treasury Regulations with final effect disallowing such foreign tax credits; (ii) 90% of the amount by which the FTC Amount is reduced by operating losses of Porges following the Closing; and (iii) 100% of the amount by which the foreign tax credits of Porges that would have been attributable to the operating income of Porges for the Pre-Closing Tax Period (determined under the principles of Section 8.7(a)) are reduced by the operating losses of Porges following the Closing.  For purposes of this subsection (b), operating losses shall be used first to reduce the operating income of Porges, and then to reduce the gain from the Porges Asset Sale.

(c)                 Seller and Buyer shall provide each other with access to all information reasonably necessary to determine the accuracy of the amounts required to be determined by this Section 8.6.

8.7                Tax Matters

(a)                 Returns; Indemnification; Liability for Taxes. 

                                                                               (i)            Seller shall prepare and file (or cause to be prepared and filed) on a timely basis all Tax Returns with respect to Seller and its Subsidiaries for all taxable periods ending on or before the Closing Date and shall pay, and shall indemnify and hold Buyer harmless against and from (A) all Taxes of Seller and its Subsidiaries for all taxable years or periods that end on or before the Closing Date; (B) all Taxes for which Seller or any of its Subsidiaries may be liable under Treasury Regulation Section 1.1502‑6 (or any similar provision of state, local or foreign law); and (C) with respect to any taxable period commencing before the Closing Date and ending after the Closing Date (a "Straddle Period") all Taxes of Seller and its Subsidiaries attributable to the Tax period prior to and including the Closing Date (the "Pre-Closing Tax Period") (the Taxes referred to in items (A), (B), and (C) of this sentence are referred to herein as "Pre-Closing Taxes"); provided, however, that to the extent that any such Taxes (i) are reflected as a Liability in the calculation of Net Working Capital as reflected on the Final Net Working Capital Statement, or (ii) are described in Section 8.6(a) ((i) and (ii), collectively, the "Assumed Taxes"), such Assumed Taxes shall not be considered "Pre-Closing Taxes" hereunder, and Seller shall have no obligation to indemnify Buyer for any such Assumed Taxes.  For purposes of this Agreement, the portion of any Tax that is attributable to a Pre-Closing Tax Period shall be (A) in the case of a Tax that is not based on net income, gross income, premiums or gross receipts, the total amount of such Tax for the period in question multiplied by a fraction, the numerator of which is the number of days in the Pre-Closing Tax Period, and the denominator of which is the total number of days in such Straddle Period, and (B) in the case of a Tax that is based on any of net income, gross income, premiums or gross receipts, the Tax that would be due with respect to the Pre-Closing Tax Period if such Pre-Closing Tax Period were a separate taxable period, except that exemptions, allowances, deductions or credits that are calculated on an annual basis (such as the deduction for depreciation or capital allowances) shall be apportioned on a per diem basis. 

                                                                             (ii)            Buyer shall prepare and file (or cause to be prepared and filed) on a timely basis all Tax Returns relating to the Transferred Assets or the operation of the Business (including all Tax Returns of the Transferred Subsidiaries) for periods ending after the Closing Date and shall pay and shall indemnify and hold Seller harmless against and from (A) all Taxes of Buyer and its Subsidiaries (including the Transferred Subsidiaries) for any taxable year or period commencing after the Closing Date; (B) all Taxes of Buyer and its Subsidiaries (including the Transferred Subsidiaries) for any Straddle Period other than Pre‑Closing Taxes; (C) all withholding Taxes incurred in connection with the transactions contemplated hereby; and (D) all Assumed Taxes.

                                                                            (iii)            If, in order to properly prepare its Tax Returns or other documents required to be filed with the Governmental Authorities, it is necessary that a Party be furnished with additional information, documents or records relating to the Transferred Assets, both Seller and Buyer agree to use commercially reasonable efforts to furnish or make available such nonprivileged information at the other's request, cost and expense; provided, however, that neither Party shall be entitled to review or examine the Tax Returns of the other Party (other than the Tax Returns related to MML, Porges and the Porges Asset Sale).

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(b)                 Refunds and Credits.  Any refunds and credits attributable to Pre‑Closing Taxes to the extent not taken into account in the calculation of Net Working Capital as reflected in the Final Net Working Capital Statement shall be for the account of Seller if properly reportable by Seller on any of its pre-Closing Tax Returns or with respect to any Pre-Closing Tax Period and any other refunds and credits shall be for the account of Buyer.  To the extent permitted by applicable Law, Buyer shall (or shall cause or permit its Subsidiaries to) elect to relinquish any carryback of a Tax attribute to any Pre-Closing Tax Period.  In cases where Buyer cannot elect to relinquish such carrybacks, Seller agrees to pay to Buyer the net Tax benefit received by Seller or any of its Subsidiaries from the use in any Pre-Closing Tax Period of a carryback of any Tax arising in a Post-Closing Tax Period.  If an audit or other examination of any Tax Return of Seller or its Subsidiaries for any taxable period ending on or before the Closing Date, or of Buyer or its Subsidiaries for any taxable period ending after the Closing Date, shall result (by settlement or otherwise) in any adjustment, the effect of which is to increase deductions, losses or tax credits or decrease income, gains, premiums, revenues or recapture of tax credits ("Changes") of the other party, the audited party will notify such other party and provide it with all necessary information so that it can reflect on its Tax Returns any such Changes.  If as a result of such Changes, the other party enjoys a net Tax benefit, such party shall pay to the audited party the amount of such net Tax benefit.

(c)                 Transfer Taxes.  Notwithstanding any other provision of this Agreement, (i) all Transfer Taxes arising in connection with the Porges Asset Sale shall be borne by Buyer as set forth in Section 8.6 of this Agreement; and (ii) all other Transfer Taxes and related fees incurred in connection with the Operative Agreements, and the transactions contemplated hereby, shall be borne equally by Buyer and Seller.  To the extent reasonable and legally able to do so, Buyer and Seller shall cooperate with each other to minimize such Taxes.  The Party required by law to file a Tax Return with respect to such Transfer Taxes shall do so within the time period prescribed by law, and the other Party shall promptly reimburse the paying Party for such other Party's portion of the  Transfer Taxes so paid upon receipt of notice that such Transfer Taxes have been paid.

(d)                 Post-Closing Actions by Buyer.  Following the Closing, Buyer shall not make any election under U.S. or foreign Tax law, cause any Transferred Subsidiary to pay a dividend, elect to carryback any loss or otherwise take any action that could adversely affect Seller without the prior written consent of Seller; provided, however, that, if requested by Seller, Buyer shall make a timely election under Section 338 of the Code, in form and substance satisfactory to Seller, with respect to the purchase of the Equity Interests of Porges and/or MML.

(e)                 Tax Audit Support.  In the event and for so long as any Party actively is contesting or defending against any Tax audit or other investigation, claim or proceeding relating to a taxable period ending on or prior to the Closing Date involving Seller or its Subsidiaries, each Party shall cooperate with the other Party and its counsel in the contest or defense, make available their personnel, and provide such testimony and access to their books and records as shall be necessary in connection with the contest or defense, all at the sole cost and expense of the indemnifying Party.

8.8                Allocation of Purchase Price

The Preliminary Purchase Price shall be provisionally allocated by Seller and Buyer mutually not later than ten Business Days prior to the Closing Date and shall be set forth in the form substantially similar to Exhibit F attached hereto (the "Preliminary Purchase Price Allocation").  Not later than 30 days following the preparation of the Final Net Working Capital Statement, the Preliminary Purchase Price Allocation shall be adjusted by mutual agreement of the Parties (or if the parties cannot agree within such 30 days, by the CPA Firm within the following 30 days) to take into account the final determined amount of the Purchase Price and the final determined values of all Transferred Assets, it being understood that any such adjustment shall not adjust the total cash consideration set  forth in any of the Conveyance Documents (such adjusted allocation, the "Purchase Price Allocation").  Upon its completion, the Purchase Price Allocation shall become part of the Agreement.  Each of the Parties, when reporting the transactions consummated hereunder in its own Tax Returns, shall allocate the Purchase Price paid or received, as the case may be, in a manner that is consistent with the Purchase Price Allocation.  Additionally, each of the Parties will comply with, and furnish the information required by, Section 1060 of the Code, and any regulations thereunder.

8.9                Return of Excluded Assets

Promptly following the Closing, and in any event within thirty (30) days after the Closing Date, Buyer will remit to Seller an amount of cash equal to the amount of cash on the general ledger of each Transferred Subsidiary as of the Closing.  The remittance will be treated as a return of Excluded Assets and not as an adjustment to the Purchase Price.  If at any time within 12 months following the Closing Date, Buyer becomes aware of any other Excluded Assets that were delivered to Buyer in connection with the Operative Agreements, Buyer shall promptly notify Seller of the Excluded Assets in its possession, and shall return (or at Seller's discretion, destroy) such Excluded Assets, including all copies thereof.  In any case, Buyer agrees to keep and treat all Excluded Assets as "Evaluation Material" in accordance with the terms of the Confidentiality Agreement.  

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8.10            Brokers

Seller shall be responsible for, and shall reimburse, indemnify and hold harmless Buyer for, all Losses arising from a claim by a finder or broker that it acted on behalf of Seller (or a Subsidiary thereof) in connection with the transactions contemplated hereby.  Buyer shall be responsible for, and shall reimburse, indemnify and hold harmless Seller for, all Losses arising from a claim by a finder or broker that it acted on behalf of Buyer (or a Subsidiary thereof) in connection with the transactions contemplated hereby.

8.11            Further Assurances

From and after the Closing Date, Seller shall cooperate with Buyer and its representatives and shall execute and deliver such documents and take such other actions as Buyer may reasonably request, for the purposes of evidencing the transactions contemplated by this Agreement and putting Buyer in possession and control of all of the Transferred Assets and Transferred IPR, especially to the extent located overseas; provided, however, that notwithstanding anything herein to the contrary, nothing herein shall require Seller or its Affiliates to assist or cooperate with Buyer or any of its Affiliates in connection with any actual or threatened litigation, arbitration, mediation or other alternative dispute resolution procedure regarding the Transferred Business, except to the extent required by applicable Law or Article 11 (Indemnity), and to the extent that Seller or its Affiliates are required to do so by applicable Law (as distinguished from Article 11 (Indemnity)), Buyer shall promptly reimburse Seller for all out-of-pocket Expenses that it incurs in connection therewith.  From and after the Closing Date, the parties shall cooperate with each other and each party's Representatives and shall execute and deliver such documents and take such other actions as the other party may reasonably request, for the purpose of evidencing the transactions contemplated by this Agreement and as otherwise set forth herein.  In addition, Buyer will make Transferred Employees reasonably available to Seller for the purpose of obtaining, maintaining, securing and defending the Intellectual Property Rights of Seller, at Seller's expense.

8.12            Mail Handling

Effective as of the Closing Date, Buyer and/or its Affiliates shall have the right to open all mail and packages delivered to it that are addressed to Seller or any of the Transferred Subsidiaries relating to the Transferred Business, the Transferred Assets, the Transferred IPR or the Assumed Liabilities.  To the extent that Buyer and/or any of its Subsidiaries receives any mail or packages addressed to Seller or any of its Subsidiaries and delivered to Buyer and/or any of its Affiliates not relating to the Transferred Business, the Transferred Assets, the Transferred IPR or the Assumed Liabilities, Buyer shall promptly deliver such mail or packages to Seller.  After the Closing Date, Buyer may deliver to Seller any checks or drafts made payable to Seller or any of its Subsidiaries that constitute a Transferred Asset, and Seller shall promptly deposit such checks or drafts, and, upon receipt of funds, reimburse Buyer within five Business Days for the amounts of all such checks or drafts, or, if so requested by Buyer, endorse such checks or drafts to Buyer for collection.  To the extent Seller or any of its Subsidiaries receives any mail or packages addressed and delivered to Seller but relating to the Transferred Business, the Transferred Assets, the Transferred IPR or the Assumed Liabilities, Seller shall, or shall cause such Subsidiaries to, promptly deliver such mail or packages to Buyer.  After the Closing Date, to the extent that Buyer or any of its Affiliates receives cash or checks or drafts made payable to Buyer that constitute an Excluded Asset, Buyer shall promptly use such cash to, or deposit such checks or drafts and upon receipt of funds from such checks or drafts, reimburse Seller within five Business days for such amount received, or, if so requested by Seller, endorse such checks or drafts to Seller for collection.

8.13            Non‑Solicitation

(a)                 Seller agrees that for a period of four (4) years from and after the Closing Date it shall not, and it shall cause and each of its Subsidiaries not to, without the prior written consent of Buyer, directly or indirectly, solicit to hire (or cause or seek to cause to leave the employ of Buyer or any of its Subsidiaries) (i) any Transferred Employee in the Territory, or (ii) any Person employed by Buyer or any of its Subsidiaries in the Territory who became known to or was identified to Seller or any of its Subsidiaries in connection with the transactions contemplated by this Agreement, unless, in the case of clause (i) or (ii) above, such Person ceased to be an employee of Buyer and/or its Subsidiaries at least six (6) months prior to such action by Seller or any of it Subsidiaries.

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(b)                 Except with respect to Transferred Employees, Buyer agrees that for a period of four (4) years from and after the Closing Date it shall not, and it shall cause each of its Subsidiaries not to, without the prior written consent of Seller, directly or indirectly, solicit to hire (or cause or seek to cause to leave the employ of Seller or any of its Subsidiaries) (i) any Person employed by Seller or any Subsidiary of Seller in the Territory immediately following the Closing or (ii) any Person employed by Seller or any Subsidiary of Seller in the Territory who became known to or was identified to Buyer or any of its Subsidiaries in connection with the transactions contemplated by this Agreement, unless, in the case of clause (i) or (ii) above, such Person ceased to be an employee of Seller and/or its Subsidiaries at least six (6) months prior to such action by Buyer or any of its Subsidiaries.

(c)                 Notwithstanding the foregoing, the restrictions set forth in Section 8.13(a) and Section 8.13(b) shall not prohibit the placement of bona fide public advertisements for employment by any party and not specifically targeted at, in the case of Seller, any Transferred Employee or any Person employed by Buyer or a Subsidiary of Buyer or, in the case of Buyer, any person employed by Seller.  Section 8.13(a) shall not apply to any Person employed outside of the United States who is hired by Seller or any Subsidiary of Seller (i) pursuant to any existing agreement with employee representatives by which Seller or any Subsidiary of Seller are bound or (ii) as a result of actions required to be taken by Seller or any Subsidiary of Seller in order to comply with local employment Laws.

8.14            Pre-Closing Integration Planning

During the period beginning on the date hereof and continuing until the Closing, the Parties shall reasonably cooperate and communicate with one another concerning pre-Closing communications and integration planning communications on a country-by-country basis. 

8.15            Confidentiality

(a)                 Confidentiality Agreement.  The Confidentiality Agreement shall continue in full force and effect and survive the execution of this Agreement, the Closing, the consummation of the transactions contemplated hereby and/or the termination of this Agreement for seven (7) years.  The Parties hereby agree that the term "Evaluation Material," as used in the Confidentiality Agreement shall be deemed to include (i) all exhibits, schedules, certificates and other documents executed or delivered in connection with this Agreement, the other Operative Agreements and the consummation of the transactions contemplated hereby and thereby, (ii) all proprietary and confidential information concerning Seller and its Subsidiaries, which includes all information with respect to the Business, and (iii) all documents and materials contained in Seller's data room, or otherwise furnished or made available (directly or indirectly) to Buyer or its Subsidiaries; provided, however, that after the Closing, with respect to Buyer, the foregoing shall not apply to such information that (1) is solely related to the Transferred Subsidiaries, Transferred Assets, Transferred IPR or Assumed Liabilities and (2) is not also related to any business or assets of Seller (or a Subsidiary thereof) not transferred to Buyer under this Agreement.  In addition, notwithstanding any other provision of the Confidentiality Agreement, and this Agreement, Buyer and its Affiliates and Seller and its Affiliates may include this Agreement and the other Operative Agreements in or as an exhibit to any report, form or registration statement filed with or furnished to the SEC.  Seller agrees to treat and hold confidential any information concerning the Business and the affairs of the Business that is not (other than by virtue of Seller's violation of this Section 8.15(a)) generally available to the public; provided, however, that nothing in this Section 8.15(a) shall prohibit Seller or any of its Subsidiaries from complying with applicable Laws or the rules and regulations of any stock exchange or over the counter trading market on or through which Seller's securities are traded.

(b)                 Release of Certain Confidentiality Obligations.  Effective as of the Closing, Seller shall, or shall cause its applicable Subsidiary to, release the Transferred Employees from any confidentiality obligations they may have to Seller (or a Subsidiary thereof) with respect to trade secret, confidential and other information that relates to the Business, but only to the extent such information does not also relate to any business or assets of Seller (or a Subsidiary thereof) not transferred to Buyer (or a Subsidiary thereof) under this Agreement.

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8.16            Non-Competition

(a)                 Seller agrees that for a period commencing on the Closing Date and terminating on the seventh (7^th) anniversary of the Closing Date, Seller will not, and will cause its Subsidiaries and Affiliates not to, engage, directly or indirectly, in a Competing Business anywhere in the Territory.  The foregoing restrictions will terminate in the event of a Change of Control of Seller.  The foregoing restrictions are reasonable and appropriate, do not exceed the protection necessary to secure the goodwill purchased, and do not place undue hardship on Seller. 

(b)                 The remedy at law for any breach of the foregoing will be inadequate and Buyer, in addition to any other relief available to it, shall be entitled to temporary and permanent injunctive relief without the necessity of proving actual damages.  If any provisions of any restrictive covenant contained herein, should be deemed to exceed the limitations allowed by applicable Law, then such provision shall be reformed to provide the maximum limitations permitted. 

(c)                 Notwithstanding the foregoing, the provisions of this Section 8.16 shall not restrict Seller or any Subsidiaries of Seller from acquiring and thereafter operating any Business Competitor (an "Acquired Entity") so long as (a) Seller or such Subsidiary, within three (3) months after such acquisition, offer to enter into good faith discussions for forty-five (45) days with Buyer for the purpose of providing Buyer the opportunity to (i) purchase the Competing Business from Seller or its Subsidiaries, or (ii) enter into a joint venture, distribution agreement or similar agreement with Seller or its Subsidiaries with respect to the Competing Business, with closing of a purchase (in (i)) or execution of an agreement (in (ii)) to occur within eighteen (18) months following the acquisition by Seller or its Subsidiaries of the Acquired Entity and (b) if Seller or such Subsidiary and Buyer fail to (i) consummate a transaction resulting in a purchase of the Competing Business by Buyer, or (ii) enter into a joint venture, distribution agreement or similar agreement with respect to the Competing Business after offering to enter into good faith discussions with Buyer for that purpose as contemplated by clause (a) above, Seller or such Subsidiary shall offer to enter into good faith discussions for forty-five (45) days with Buyer for the purpose of providing Buyer the opportunity to purchase the Competing Business from Seller or its Subsidiaries, or enter into a joint venture, distribution agreement or similar agreement with Buyer with respect to the Competing Business, if the terms offered are more favorable to those terms previously offered to the Buyer pursuant to clause (a) above, prior to entering into a similar arrangement with a third party.

8.17          Real Estate Matters

(a)            Real Property Lease Assignments.

 (i)            Promptly following execution of this Agreement, Seller shall contact the Landlords under the Assigned Leases and seek each Landlord's consent to the assignment of the applicable Assigned Lease to Buyer and a release of Seller from further liability under the applicable Assigned Lease.  If Seller obtains prior to the Closing Date such consent, Seller shall assign to Buyer and Buyer shall accept from Seller an assignment of such Assigned Lease in accordance with Section 3.2 hereof (the "Real Property Lease Assignments").  Any such Real Property Lease Assignment shall be effective on the Closing Date and shall be on the terms of the lease assignment form reasonably acceptable to Buyer and Seller.

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(ii)            Seller shall use commercially reasonable efforts to obtain the consents and releases set forth in clause (i) above, but shall not be required to commence judicial proceedings for a declaration that a consent has been unreasonably withheld, delayed or conditioned.  Seller shall have the right, in its sole and absolute discretion, but shall not be required, to pay any additional consideration or provide any additional security or guarantees to the Landlords.  Buyer shall cooperate with Seller in attempting to obtain the consents and releases set forth above, including (i) providing financial statements, references and additional security and/or guarantees as may be requested by the relevant Landlords, (ii) entering into any amendments to the Leases as may be requested by the relevant Landlords or (iii) entering into direct Leases of the applicable premises leased under an Assigned Lease (the "Assigned Lease Premises") with the relevant Landlords, if requested by such Landlords.  Notwithstanding anything to the contrary in this Agreement, if the Landlord under any Assigned Lease conditions its grant of a consent (including by threatening to exercise a "recapture" or other termination right) upon, or otherwise requires in response to a notice or consent request regarding this Agreement or any Operative Agreement, the payment of a consent fee, "profit sharing" payment or other consideration (including increased rent payments), or the provision of additional security (including a guaranty), Buyer shall be solely responsible for making all such payments or providing all such additional security.  Notwithstanding anything to the contrary in this Agreement, in the event that Seller makes any such payments, Buyer shall promptly reimburse Seller for such amounts.  Buyer shall not, however, communicate directly with any of Seller's Landlords without the prior written consent of Seller.

(iii)            If, despite the efforts of the parties as set forth in clauses (ii) and (iii) above, a Landlord of an Assigned Lease Premises fails to consent to the assignment of the applicable Assigned Lease of such Assigned Lease Premises prior to the Closing Date, subject to Section 8.17(a)(iv) below:

(1)                 Buyer shall be entitled to occupy the relevant Assigned Lease Premises as a licensee upon the terms and conditions contained in Seller's Assigned Lease of such Assigned Lease Premises.  Such license shall not be revocable due to the relevant Landlord's failure to consent, unless (A) the relevant Landlord formally, unconditionally refuses to consent or (B) an enforcement action or forfeiture by the relevant Landlord due to Buyer's occupation of such Assigned Lease Premises cannot, in the reasonable opinion of Seller, be avoided other than by requiring Buyer to immediately vacate the relevant Assigned Lease Premises.  In either such event, Seller may terminate the license by delivering written notice to Buyer, and Buyer shall vacate the relevant Assigned Lease Premises immediately or by such other date as may be specified in a notice served by Seller.  Buyer shall be solely responsible for, and shall indemnify, defend, protect and hold harmless Seller from, all losses, costs, damages, claims and liabilities incurred by Seller or Buyer as a consequence of Buyer's occupation of such Assigned Lease Premises, including as a result of any enforcement action taken by the relevant Landlord with respect to any breach by Seller of the relevant Assigned Lease in permitting Buyer to so occupy the relevant Assigned Lease Premises without obtaining the required consent.  Buyer shall not be entitled to make any claim or demand against, or obtain reimbursement from, Seller with respect to any costs, losses, claims, liabilities or damages incurred by Buyer as a consequence of being obliged to vacate an Assigned Lease Premises or in obtaining alternative premises, including any enforcement action which a Landlord may take against Buyer.

(2)                 whether or not Buyer occupies such Assigned Lease Premises as licensee as provided above, Buyer shall, effective as of the Closing Date, (A) pay Seller all rents, service charges, insurance premiums and other sums payable by Seller under the relevant Assigned Lease of the Assigned Lease Premises, (B) observe and perform all of Seller's covenants, obligations and conditions contained in the relevant Assigned Lease of the Assigned Lease Premises and (C) indemnify, defend, protect and hold harmless Seller from and against all losses, costs, claims, damages and liabilities arising on account of any breach thereof by Buyer.  Immediately upon receipt of the relevant Landlord's consent to the assignment of an Assigned Lease Premises, as set forth above, Buyer and Seller shall enter into a Real Property Lease Assignment with respect to such Assigned Lease Premises.

(iv)            If, despite the efforts of the parties as set forth above, a Landlord of an Assigned Lease Premises formally, unconditionally refuses to consent to the assignment of the applicable Assigned Lease:

(1)                 Without limiting Seller's rights as set forth in subparagraphs (2) and (3) below, Seller may by written notice to Buyer elect to apply to the relevant Landlord for consent to sublease all of the relevant premises to Buyer for the remainder of the relevant Assigned Lease term at a rent equal to the rent from time to time under the relevant Assigned Lease, but otherwise on substantially the same terms and conditions as the relevant Assigned Lease and pursuant to the terms of a reasonable sublease form prepared by Seller.  If Seller makes such an election after the Closing Date (or before the Closing Date, if the Landlord consent is not received before the Closing Date), the provisions of Section 8.17(a)(iii) will apply, except, on the grant of the consent required to sublease the Assigned Lease Premises in question, Seller shall sublease to Buyer the relevant Assigned Lease Premises as set forth herein.  If Seller makes such an election before the Closing Date and the relevant Assigned Lease consent is obtained before the Closing Date, Seller shall sublease to Buyer the relevant Assigned Lease Premises on the Closing Date as set forth above.

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(2)                 If the Landlord formally, unconditionally refuses such consent prior to the Closing Date, Seller may elect by written notice to Buyer to delete the relevant Assigned Lease from the term "Assigned Leases" hereunder.  In such case, on the Closing Date, Seller shall not assign or sublease such premises to Buyer, and Buyer shall vacate the relevant premises.  Buyer shall not be entitled to make any claim or demand against or obtain reimbursement from Seller with respect to any costs, losses, claims, liabilities or damages incurred by Buyer as a consequence of being obliged to vacate the applicable premises or obtaining alternative premises.

(b)                 Space-Sharing Arrangements.  Buyer and Seller agree to negotiate in good faith the space-sharing arrangements at those facilities to be shared by Buyer and Seller or their respective Subsidiaries following the Closing, which arrangements will be on commercial terms equivalent to those that could be obtained in reasonable arms length market transactions, and with respect to the sublease of the properties located at 301 Mentor Drive, Santa Barbara, California 93111, arrangements substantially on the terms set forth on Schedule 8.17(b).

(c)                 Casualty.  Buyer and Seller shall grant and accept the leases, assignments, subleases or licenses of the premises as described in this Section 8.17, regardless of any casualty damage or other change in the condition of the applicable premises.  In addition, in the event that any Assigned Lease is terminated prior to the Closing Date, notwithstanding anything to the contrary in this Agreement, including Section 3.2, (a) Seller or its applicable Subsidiary shall not be required to assign such premises, (b) Buyer or its applicable Subsidiary shall not be required to accept an assignment of such premises and (c) neither party shall have any further liability with respect to such premises hereunder.

8.18            Licensed Patent Schedule

Without limiting the definition of Licensed Patents set forth in Section 1.94, if prior to the fifth (5^th) anniversary of the Closing Date there is an inaccuracy with respect to Schedule 1.94 such that the representation set forth in Section 5.11 with respect to Licensed IPR was not true and correct as of the Closing Date, then, notwithstanding anything to the contrary set forth herein, as Buyer's sole and exclusive remedy with respect to the breach of the representation set forth in Section 5.11(d), on Buyer's written request, Seller shall add to such Patents as may be owned and licensable by Seller to Schedule 1.94 (and such Patents shall be deemed for all purposes as if such added Patents were on such Schedule as of the Closing Date).

8.19            Name Change

(a)                 On or promptly after the Closing Date, Seller shall use its commercially reasonable efforts to cause a change of the following corporate names with the applicable Secretary of State in such a way as to allow Buyer to qualify and register to form a corporation under the following names: Mills Biopharmaceuticals and Selene (together, the "Transferred Names"), and shall execute and deliver all documents, certificates or other evidence required by the applicable Secretary of State to allow Buyer to reserve such name and establish entities with the applicable Secretary of State bearing such names.  On or promptly after the Closing Date, Seller shall use its commercially reasonable efforts to change the Transferred Names by filings with the applicable Secretary of State as reasonably requested by Buyer to give Buyer the same rights as Seller had to the Transferred Names immediately prior to the Closing.

(b)                 On or promptly after the Closing Date, Buyer shall use its commercially reasonable efforts to cause a change of the corporate name of each Transferred Subsidiary that has "Mentor" as part of its corporate name with the applicable Governmental Authority in such a way so that "Mentor" is no longer part of the corporate name.

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8.20            Business Permits

Beginning on the date hereof and ending 180 days following the Closing Date, Seller agrees that it shall (or, as applicable, cause its relevant Subsidiary to) use its commercially reasonable efforts to assist Buyer to effect the assignment, transfer or renewal of, or where applicable, re‑application for, the Business Permits.  Such assistance shall include cooperating with the gathering of information to be provided to the applicable Governmental Authority and responding to such other reasonable requests as are made by Buyer; provided, however, that Seller and its Subsidiaries shall not be required to incur any more than a nominal cost in providing such assistance and shall not be responsible for the payment of any Business Permit fees or related costs.

8.21            Environmental Insurance

Buyer and Seller agree to cooperate in good faith to obtain, effective as of the Closing, the environmental insurance policies described on Schedule 8.21 naming Buyer and its relevant Subsidiaries as the named insureds and Seller and its relevant Subsidiaries as additional named insureds ("Environmental Insurance").  Buyer and Seller agree and acknowledge that Buyer and Seller shall equally bear the cost of the Environmental Insurance policy premium up to a total amount of $300,000, and Seller shall pay the full cost of any excess.  Buyer and Seller respectively shall complete any application and such other documents as are necessary to obtain the Environmental Insurance.  Buyer and Seller shall provide such additional information as may be required by the insurer following the date hereof.

8.22            Transition Services Agreement

From the date hereof until the Closing, Buyer and Seller agree to negotiate in good faith enhancements to the Transition Services Agreement that are mutually beneficial to both Parties.

8.23            Product Liability

Buyer hereby agrees to pay Seller $300,000 per year for a period of seven years, to be paid in equal amounts on a semi-annual basis with the first payment to occur on the six month anniversary of the Closing Date, in connection with Product Liability Claims that constitute Excluded Liabilities.  Buyer shall cooperate with Seller in Seller's defense of any Product Liability Claim that constitutes an Excluded Liability, and Seller shall have reasonable access to the books, records and personnel which are pertinent to the defense and which are in the possession or control of Buyer.  Seller shall cover the reasonable expenses of Buyer for such cooperation consistent with Seller's past practice.

8.24            Supply of SMEC Products; UK Marks

(a)                 On the date hereof, (i) Buyer entered into that certain Agreement with Coloplast Limited ("CP UK"), MML, Rochester Medical Corporation ("RMC") and Rochester Medical Limited ("RM UK"), pursuant to which Buyer, CP UK and MML have agreed to transfer certain assets to RMC or RM UK immediately following the Closing (the "MML Sale"), (ii) Seller and RMC entered into that certain Asset Purchase Agreement (the "Anoka Agreement"), pursuant to which Seller will transfer certain assets to RMC (the "Anoka Sale"), and (iii) Buyer and Seller entered into that certain Termination Agreement pursuant to which the Existing Supply Agreement will terminate (the "Termination").

(b)                 If as of immediately following the Closing either (1) the MML Sale has not been consummated, (2) the Anoka Sale has not been consummated or (3) the Termination has not occurred, the Parties agree that, notwithstanding anything to the contrary contained herein (including in the Schedules):

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(i)            the existing Male External Catheter ("MEC") supply arrangements to the extent pertaining to the supply of Transfix products from Seller to MML with respect to the UK will automatically terminate as of and subject to the Closing;

(ii)            Buyer and Seller will enter into a new agreement for the supply by Seller and purchase by Buyer of Silicone Male External Catheters ("SMEC") products, currently manufactured by Seller in its manufacturing facility in Anoka, Minnesota (the "Anoka Facility"), for sale by Buyer worldwide other than in the UK, for five (5) years from the Closing Date;

(iii)            Buyer and Seller will continue the Existing Supply Agreement for distribution and sale of silicone and latex Male External Catheter products in the UK ("UK MEC Products") until its expiration;

(iv)            with respect to the new supply agreement referred to in clause (ii) above, (A) the terms of the supply agreement will be on commercially reasonable terms that are substantially similar (other than with respect to territory, price and product volumes) as that contained in the Existing Supply Agreement, (B) pricing under such supply agreement will be intended to cover only Seller's total fully burdened costs of supporting the manufacture and supply of such products to Buyer without realizing a profit therefrom and, accordingly, the price for such products charged by Seller to Buyer for such products will be all costs and expenses to support the manufacture and supply of such products, and (C) Buyer shall provide Seller with certain manufacturing support functions and services;

(v)            the Existing Supply Agreement shall be assignable to a third party in connection with Buyer's sale of Buyer's UK MEC Business (excluding MECs developed independently by Buyer);

(vi)            during the term of the new supply agreement described in clause (ii) above, Seller will not transfer the manufacturing capacity (other than as a part of a Change of Control of Seller) of the Anoka Facility without the consent of Buyer, which shall not be unreasonably withheld, delayed or conditioned (it being understood that it will be unreasonable to withhold consent if the transferee is capable of continuing the supply agreements referred to in clauses (ii) and (iii) above and agrees to honor such agreements);

(vii)            Seller's obligations in Section 8.16 (Non-competition) will be deemed hereby to be amended to provide that the developing, manufacturing, marketing, selling or distributing of SMECs (only) manufactured in the Anoka Facility shall not be considered a "Competing Business" or otherwise violate the covenants contained therein;

(viii)            Seller shall (A) retain ownership of all rights in the UK in the CLEAR ADVANTAGE Mark, the URO-FLOW Mark, the FREEDOM PLUS Mark, the TRANSFIX Mark and the UK registration of the TRANSFIX Mark (UK Reg. No. 2,201,911), the URO-FLO XTEND Mark and the UK registration of the URO-FLO XTEND Mark (UK Reg. No. 1,384,039), the URO-FLO UNIQUE Mark and the UK registration of the URO-FLO UNIQUE Mark (UK Reg. No. 1,429,535) and the UROFLO SILKIE Mark and the UK registration of the UROFLO SILKIE Mark (UK Reg. No. 2,049,250) (and the associated goodwill of each such Mark) (collectively, the "Retained MEC Marks") and (B) receive from Buyer, and Buyer shall grant to Seller, after the expiration or other termination of the Existing Supply Agreement, a paid up, royalty free, perpetual, transferable, irrevocable, exclusive (including as to Buyer) trademark license to use the FREEDOM Mark (including with respect to any registration thereof) in the UK (the "Licensed MEC Mark" and, collectively with the Retained MEC Marks, the "UK MEC Marks") in connection with all UK MEC Products.  Buyer shall continue to maintain the exclusive sales, marketing and distribution rights to the UK MEC Marks for use with the UK MEC Products pursuant to the Existing Supply Agreement for the remaining term of the Existing Supply Agreement.  At the expiration or other termination of the Existing Supply Agreement for any reason, Buyer's rights in and to the UK MEC Marks for use with UK MEC Products shall cease. The sale, distribution or other use of the UK MEC Marks in connection with UK MEC Products shall not be considered a "Competing Business" or otherwise violate the covenants contained in Section 8.16. If Seller retains ownership of the Retained MEC Marks pursuant to this paragraph, the Parties agree to amend the Schedules as appropriate to reflect Seller's retention thereof. 

(ix)            For the avoidance of doubt, there shall be no restrictions on Seller's right to use the UK MEC Marks retained by or licensed to Seller pursuant to Section 8.24(b)(viii) in connection with the UK MEC business. Buyer acknowledges and agrees that Seller intends to sell the UK MEC business to a third party and that accordingly any rights in the UK MEC Marks retained by or licensed to Seller will be transferred to such purchaser of the UK MEC Business. 

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(x)            Any allocation of rights in, and use of, the UK MEC Marks will be subject to all requirements of UK Law, including those Laws that pertain to the use of trademarks.

(c)                 Notwithstanding anything to the contrary contained herein (including in the Schedules), Seller shall in any event retain all rights in the UK in the MENTOR CLEAR ADVANTAGE Mark and the UK registration of the MENTOR CLEAR ADVANTAGE Mark (UK Reg. No. 1,494,286) (and the associated goodwill) (collectively, the "MENTOR CLEAR ADVANTAGE Mark") and the MENTOR CLEAR ADVANTAGE Mark shall be deemed an Excluded Asset.  Following the Closing, Seller shall, and shall cause its Subsidiaries to, suspend the use of the MENTOR CLEAR ADVANTAGE Mark immediately following the Closing and in Seller's discretion either terminate the UK registration of the MENTOR CLEAR ADVANTAGE Mark or allow such registration to lapse when it comes up for renewal.  Notwithstanding the foregoing, if at the Closing Buyer does not purchase from Seller all products in inventory (if any) that bear the MENTOR CLEAR ADVANTAGE Mark, then following the Closing Seller shall be entitled to sell, transfer or otherwise dispose of those products that it retains. 

8.25            Escrow Agreement

The Parties agree to negotiate in good faith the terms of an escrow agreement (the "Escrow Agreement") that, together with this Agreement, will govern the Escrow Fund.

8.26            Porges Asset Sale

The Parties will effect the Porges Asset Sale in accordance with the terms of this Agreement, provided that the closing of the Porges Asset Sale will take place one day prior to the Closing Date.

8.27            ABISS

As promptly as practicable following the execution hereof, Seller agrees to work in good faith to obtain the consent of Analytical Biosurgical Solutions ("ABISS") to the assignment to Buyer of that certain Exclusive Supply Agreement dated as of January 31, 2005, between Seller, Porges and ABISS (the "ABISS Agreement"), to the extent such consent is required to effect the assignment thereof.  In the event such consent to assignment is required and Seller is unable to either obtain the consent of ABISS or provide the benefits of the ABISS Agreement to Buyer as contemplated by Section 8.1, Seller will: (i) use its commercially reasonable efforts to find a substitute manufacturer that agrees, and is ready, willing and able, to deliver substantially similar services to Buyer as are provided by ABISS to Seller as of the Closing Date pursuant to the terms of the ABISS Agreement, and (ii) indemnify and hold harmless Buyer in accordance with the provisions of Article 11 hereof (including Section 11.6, but without regard to the limitation on recovery for consequential damages provided for in Section 11.5 and Section 13.11, which shall not apply in such event) for any Losses arising out of Seller's failure to obtain such consent or provide such benefits that are incurred by Buyer during the period from the Closing Date through the earliest of (A) the date Seller is able to obtain such consent, (B) the date Seller is able to provide such benefits and (C) the date Buyer or Seller finds a substitute manufacturer pursuant to clause (i) above.

8.28            Intercompany Contracts and Balances

At or before the Closing, Seller will, and will cause each of its Subsidiaries to, terminate all intercompany Contracts, receivables and payables between (i) Seller and its Retained Subsidiaries (as defined below), or any of them, on the one hand, and (ii) the Transferred Subsidiaries (other than Mentor Development Limited Partnership), or any of them, on the other hand, except in each case for amounts payable to or receivable from (x) the Retained Subsidiaries, or any of them, on the one hand and (y) the Transferred Subsidiaries (other than Mentor Development Limited Partnership), or any of them, on the other hand.  "Retained Subsidiaries" means all Subsidiaries of Seller other than the Transferred Subsidiaries. 

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Article 9

CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE

All obligations of Buyer to effect the Closing hereunder are subject to the satisfaction at or prior to the Closing of the conditions precedent that follow, any one or more of which may be waived in writing, in whole or in part, exclusively by Buyer in its sole discretion:

9.1                Seller Closing Deliverables

Seller shall have made all the deliveries required to be made by Seller pursuant to Section 3.2.

9.2                Performance

Seller and/or its Subsidiaries shall have performed and complied in all material respects with each of the agreements, covenants and conditions contained in this Agreement that are required to be performed or complied with by Seller and/or its Subsidiaries at or prior to the Closing.

9.3                Regulatory Approvals

All Governmental Actions pursuant to HSR and those set forth on Schedule 9.3, shall have been obtained and shall remain in full force and effect and all statutory waiting periods in respect thereof shall have expired.

9.4                No Injunction or Restraints; Illegality

No provision of any applicable Law (other than the UK OFT Undertakings) shall have been enacted, entered, promulgated or enforced by any Governmental Authority that prohibits, restrains, enjoins, or restricts the consummation of the transactions contemplated hereby in any material respect and no litigation or proceeding shall be pending by any Governmental Authority seeking to prohibit, restrain, enjoin or restrict the consummation of the transactions contemplated hereby in any material respect which would reasonably be expected to succeed.

9.5                Officer's Certificate

(a)                 Buyer shall have received at the Closing, with respect to Seller, a certificate, dated as of the Closing Date, of an appropriate officer of Seller certifying that the conditions set forth in Sections 9.2, 9.6 and 9.7 have been satisfied.

9.6                Representations and Warranties

The representations and warranties set forth in Article 5 shall be true and correct (without giving effect to any qualification as to materiality or Seller Material Adverse Effect contained in any specific representation or warranty) on the Offer Date and as of the Closing Date as though such representations and warranties were made on and as of the Closing Date (provided that those representations and warranties which address matters only as of a particular date shall have been true and correct only on such date), except as would not, individually, or in the aggregate, constitute or be reasonably likely to constitute a Seller Material Adverse Effect.

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9.7                No Seller Material Adverse Effect

There shall not have occurred and be continuing a Seller Material Adverse Effect.

9.8                Transition Services Agreement

The Parties shall have executed and delivered the Transition Services Agreement.

Article 10

CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS TO CLOSE

All obligations of Seller to effect the Closing hereunder are subject to the satisfaction at or prior to the Closing of the conditions precedent that follow, any one or more of which may be waived in writing, in whole or in part, exclusively by Seller:

10.1            Buyer Closing Deliverables

Buyer shall have made all the deliveries required to be made by Buyer pursuant to Section 3.3.

10.2            Performance

Buyer and/or its Subsidiaries shall have performed and complied in all material respects with each of the agreements, covenants and conditions contained in this Agreement that are required to be performed or complied with by Buyer and/or its Subsidiaries at or prior to the Closing.

10.3            Regulatory Approvals

All Governmental Actions pursuant to HSR and those set forth on Schedule 9.3, including those in jurisdictions outside the United States, shall have been obtained and shall remain in full force and effect and all statutory waiting periods in respect thereof shall have expired.

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10.4            No Injunction or Restraints; Illegality

No provision of any applicable Law shall have been enacted, entered, promulgated or enforced by any Governmental Authority that prohibits, restrains, enjoins, or restricts the consummation of the Transfer in any material respect and no litigation or proceeding shall be pending by any Governmental Authority seeking to prohibit, restrain, enjoin or restrict the consummation of the Transfer in any material respect which would reasonably be expected to succeed.

10.5            Officer's Certificate

Seller shall have received at the Closing, with respect to Buyer, a certificate signed by an appropriate officer of Buyer dated the Closing Date certifying that the conditions set forth in Sections 10.2, 10.6 and 10.8 have been satisfied.

10.6            Representations and Warranties

The representations and warranties set forth in Article 6 shall be true and correct (without giving effect to any qualification as to materiality or Buyer Material Adverse Effect contained in any specific representation or warranty) on the Offer Date and as of the Closing Date as though such representations and warranties were made on and as of the Closing Date (provided that those representations and warranties which address matters only as of a particular date shall have been true and correct only on such date), except as does not, individually, or in the aggregate, constitute or would reasonably be likely to constitute a Buyer Material Adverse Effect.

10.7            Sufficient Funds

Buyer shall have sufficient funds to pay the Purchase Price.

10.8            No Buyer Material Adverse Effect

There shall not have occurred and be continuing a Buyer Material Adverse Effect.

10.9            UK OFT Undertakings

The UK OFT shall not have decided that the UK OFT Undertakings prevent or delay the consummation of the transactions contemplated by this Agreement.

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Article 11

INDEMNITY

11.1            Survival

The representations and warranties of the Parties set forth in this Agreement or in any instrument delivered pursuant hereto shall survive for 18 months after the Closing Date; provided, however, that (i) the representations and warranties of Seller set forth in Section 5.20 (Products Liability) shall survive for 12 months after the Closing Date, and (ii) the representations and warranties of Seller set forth in Section 5.1 (Organization and Authority (other than the last sentence of Section 5.1(a) and the last sentence of Section 5.1(b) concerning qualification of as a foreign corporation), Section 5.2 (Transferred Subsidiaries, Capitalization), Section 5.5 (No Broker), the first sentence of Section 5.15(c) (Title to Real Property) and Section 5.25 (Sufficiency) (such representations and warranties in this clause (ii), collectively, the "Structural Representations") and the representations and warranties of Buyer set forth in Section 6.1 (Organization of Buyer), Section 6.2 (Authorization) and Section 6.6 (No Broker) shall survive until the tenth (10^th) anniversary of the Closing Date; provided further that the foregoing time limitation shall not apply to any claim for which a good faith written notice meeting the requirements set forth in Section 11.4(a) has been delivered prior to such date.  All covenants that by their terms are to be performed after the Closing shall survive the Closing.

11.2            Buyer Indemnification

Subject to the limitations set forth in this Article 11, and as otherwise expressly set forth herein, Buyer hereby agrees to indemnify Seller, Seller's Affiliates and the Seller Representatives (the "Seller Indemnified Parties"), against and agrees to hold the Seller Indemnified Parties harmless from any Loss incurred or suffered by the Seller Indemnified Parties arising out of or related to (a) a Warranty Breach by Buyer (provided that, in the event of any such breach or inaccuracy, for purposes of determining the amount of any Loss no effect will be given to any qualification as to "material," "materiality," "material adverse effect" or a "Buyer Material Adverse Effect" contained therein), (b) a Covenant Breach by Buyer, (c) the Assumed Liabilities, or (d) any (formal or informal) investigation or inquiry by the UK Competition Authorities in relation to the UK OFT Undertakings to the extent that any such investigation or inquiry prevents or delays the consummation of the transactions contemplated by this Agreement.

11.3            Seller Indemnification

(a)                 Subject to the limitations set forth in this Article 11, and as otherwise expressly set forth herein, Seller hereby agrees to indemnify Buyer and Buyer's Subsidiaries, and their respective Affiliates, officers, directors, agents, representatives, successors, assigns, partners and employees (the "Buyer Indemnified Parties") against and agrees to hold the Buyer Indemnified Parties harmless from any Loss incurred or suffered by the Buyer Indemnified Parties arising out of or related to (i) a Warranty Breach by Seller (provided that, in the event of any such breach or inaccuracy, for purposes of determining the amount of any Loss no effect will be given to any qualification as to "material," "materiality," "material adverse effect" or a "Seller Material Adverse Effect" contained therein); (ii) a Covenant Breach by Seller; (iii) the Excluded Liabilities; (iv) any failure to comply with Laws relating to bulk transfers that are applicable to the sale of the Transferred Assets; (v) Seller's Special Environmental Indemnity pursuant to Section 11.3(d); or (vi) the matters identified on Schedule 11.3(a).

(b)                 Notwithstanding anything herein to the contrary, Seller shall have no Liability with respect to indemnification under this Agreement due to a Warranty Breach until the aggregate amount of Qualifying Losses (as defined below) incurred by the Buyer Indemnified Parties exceeds $1,000,000 (the "Threshold"), in which case the Buyer Indemnified Parties shall be entitled to seek compensation for all such Qualifying Losses.  A Loss shall not be a "Qualifying Loss" eligible to be counted toward the Threshold unless such Loss, standing alone or in the aggregate with other Losses for substantially similar matters (over any time period during the survival period of the relevant representations and warranties), equals or exceeds $100,000, in which case it shall be counted from the first dollar.  Notwithstanding the foregoing, any claims for a Warranty Breach with respect to Structural Representations shall not be subject to the foregoing Threshold and Qualifying Loss limitations.

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(c)                 Notwithstanding anything herein to the contrary, in no event shall Seller be liable for indemnification under this Agreement (i) for any Losses due to Warranty Breaches (other than with respect to Structural Representations), pursuant to this Article 11 or otherwise, for any amounts, individually or in the aggregate, in excess of 15% of the Purchase Price or (ii) for any Losses due to Warranty Breaches relating to Structural Representations, pursuant to this Article 11 or otherwise, for any amounts, individually or in the aggregate, which, when taken together with amounts paid for Losses with respect to Warranty Breaches pursuant to clause (i), exceed the Purchase Price.

(d)                 Seller shall indemnify the Buyer Indemnified Parties for Seller's Special Environmental Indemnity.  The term "Seller's Special Environmental Indemnity" shall mean the following:

(i)            Minneapolis, Minnesota.  Seller shall indemnify the Buyer Indemnified Parties for Losses incurred with respect to Environmental Claims arising out of Environmental Conditions existing as of the Closing in the soil and/or groundwater on, or migrating on or before the Closing from, the Transferred Real Property or the real property that is leased pursuant to the Assigned Leases located in Minneapolis, Minnesota including those described in that certain Phase I Environmental Site Assessment - Mentor Corporation, 1401, 1499, 1525, 1601 and 1615 West River Road North, Minneapolis, Minnesota ("Minneapolis Property"), prepared by GaiaTech and dated February 2006 ("Minneapolis Environmental Losses"), on the following terms and conditions:

(1)            The Minneapolis Environmental Losses must originate from a third Person claim including any claim of a Governmental Authority (i.e. other than a direct claim brought by any Buyer Indemnified Party) ("Minneapolis Claim").

(2)             Buyer and its Subsidiaries agree not to voluntarily perform or permit to be performed any soil or groundwater testing of any kind or nature on the Minneapolis Property unless required by a Governmental Authority pursuant to Environmental Laws.  If such voluntary testing is performed except as permitted in the previous sentence, the indemnity obligations of Seller in this Section 11.3(d)(i) shall be null and void and of no further force and effect.

(3)             Seller shall only be required to indemnify for any Minneapolis Environmental Losses suffered by any of the Buyer Indemnified Parties to the extent such Losses are incurred as a result of a requirement of a Governmental Authority pursuant to Environmental Laws or, in the event of a claim by any other third Person, to the extent it is reasonable and necessary to incur such Losses pursuant to Environmental Laws.

(4)             Losses covered under this Section 11.3(d)(i) shall not include diminution in property value of the Minneapolis Property.

(5)            Notwithstanding anything to the contrary in this Agreement, the Minneapolis Environmental Losses shall only include those Losses arising under a Minneapolis Claim that has been made on or before that date which is five (5) years following the Closing Date.

(ii)            Other Business Properties.  Seller shall indemnify the Buyer Indemnified Parties for one half of all Losses (other than Seller Caused Environmental Losses, which are addressed in Section 11.3(d)(iii) below) incurred with respect to Environmental Claims arising out of Environmental Conditions existing as of the Closing in the soil and/or groundwater on, or migrating on or before the Closing from or to, all properties owned, leased or occupied as of the date hereof by Seller or any of Seller's Subsidiaries in connection with the Business, excluding the Minneapolis Property covered in Section 11.3(d)(i) above ("Other Business Property" with the Losses in this Section 11.3(d)(ii) referred to as "Other Business Property Environmental Losses"), on the following terms and conditions:

(1)                 The Other Business Property Environmental Losses must originate from a third Person claim including any claim of a Governmental Authority (i.e. other than a direct claim brought by any Buyer Indemnified Party) ("Other Business Property Environmental Claim").

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(2)                 Buyer and its Subsidiaries agree not to voluntarily perform or permit to be performed any soil or groundwater testing of any kind or nature on the Other Business Property, except: (i) as required by a Governmental Authority pursuant to Environmental Laws; or (ii) with respect to the Real Property located at Avenue Edmond Rostand, Lieu-Dit Le Pontet, Sarlat-La-Caneda, France as further described in that certain Phase I Environmental Site Assessment prepared by GaiaTech dated February 2006 (the "Sarlat Property"), which testing occurs after the first anniversary of the Closing Date and then only at the request of a potential buyer in connection with a bona fide proposed sale of the Sarlat Property.  If such voluntary testing is performed, except as permitted in the previous sentence, the indemnity obligations of Seller in this Section 11.3(d)(ii) shall be null and void and of no further force and effect as to each particular legal parcel of Real Property upon which such testing was performed. 

(3)                 Seller shall only be required to indemnify for any Other Business Property Environmental Losses suffered by any of the Buyer Indemnified Parties to the extent such Losses are incurred as a result of a requirement of a Governmental Authority pursuant to Environmental Laws or, in the event of a claim by any other third Person, to the extent it is reasonable and necessary to incur such Losses pursuant to Environmental Laws.

(4)                 Losses covered under this Section 11.3(d)(ii) shall not include diminution in property value of the relevant Other Business Property.

(5)                 Notwithstanding anything to the contrary in this Agreement, the Other Business Property Environmental Losses shall only include those Losses arising under an Other Business Property Environmental Claim that has been made on or before that date which is four (4) years following the Closing Date.

    (iii)            Except as set forth in Sections 11.3(d)(i) and 11.3(d)(ii) above, Seller shall indemnify the Buyer Indemnified Parties for all Losses incurred with respect to Environmental Claims arising out of Environmental Conditions existing as of the Closing in the soil and/or groundwater on, or migrating on or before the Closing from, all properties owned, leased or occupied at any time by Seller or any of Seller's Subsidiaries in connection with the Business to the extent caused by Seller or any Subsidiary of Seller ("Seller Caused Environmental Losses"), on the following terms and conditions:

(1)                 The Seller Caused Environmental Losses must originate from a third Person claim including any claim of a Governmental Authority (i.e. other than a direct claim brought by any Buyer Indemnified Party) ("Seller Caused Environmental Claim").

(2)                 The Seller Caused Environmental Losses can not arise as a result of soil or groundwater testing of any kind or nature that has been performed or permitted to be performed by Buyer or any Subsidiary of Buyer except as required by a Governmental Authority pursuant to Environmental Laws.  If such voluntary testing is performed, except as permitted in the previous sentence, the indemnity obligations of Seller in this Section 11.3(d)(iii) shall be null and void and of no further force and effect as to each particular legal parcel of Real Property upon which such testing was performed.

(3)                 Seller shall only be required to indemnify for any Seller Caused Environmental Losses suffered by any of the Buyer Indemnified Parties to the extent such Losses are incurred as a result of a requirement of a Governmental Authority pursuant to Environmental Laws or, in the event of a claim by any other third Person, to the extent it is reasonable and necessary to incur such Losses pursuant to Environmental Laws.

(4)                 Losses covered under this Section 11.3(d)(iii) shall not include diminution in property value of the Real Property.

(5)                 The Buyer shall bear the burden of proof that the relevant Environmental Condition constitutes Seller Caused Environmental Losses.

(6)                 Notwithstanding anything to the contrary in this Agreement, the Seller Caused Environmental Losses shall only include those Losses arising under a Seller Caused Environmental Claim that has been made on or before that date which is four (4) years following the Closing Date.

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       (iv)            Buyer hereby confirms that it has no present intention to perform any voluntary soil or groundwater testing of any kind or nature at any of the properties to be covered by the Environmental Insurance.

11.4            Procedures

Each Party agrees to give prompt written notice (such Party with the obligation to give notice, the "Indemnified Party") to the other Party (the "Indemnifying Party") of the assertion of any claim, or the commencement of any suit, action or proceeding in respect of which indemnity may be sought under this Agreement, including the estimated amount and other details of such claim; provided, however, that the failure of the Indemnified Party to so notify the Indemnifying Party shall not relieve the Indemnifying Party of its indemnification obligations hereunder, except to the extent that the Indemnifying Party shall have been materially prejudiced by such lack of timely and adequate notice.  The Indemnifying Party shall have the right, at its election, to take over the defense or settlement of any third Person claim at its own Expense by giving prompt notice to that effect to the Indemnified Party; provided, however, that the Indemnifying Party shall keep the Indemnified Party reasonably informed of the progress of such third Person claim.  If the Indemnifying Party shall have so assumed the defense of any claim, the Indemnifying Party shall be authorized to consent to a settlement of, or the entry of any judgment arising from, any such claim, in its sole discretion without the prior consent of the Indemnified Party; provided, however, that a condition to any such settlement shall be a complete release of the Indemnified Party with respect to such claim.  The Indemnifying Party agrees to consult with the Indemnified Party prior to entering into any settlement contemplated by the immediately preceding sentence, it being expressly understood that such duty to consult does not in any way limit the Indemnifying Party's right to consent to a settlement or the entry of judgment in its sole discretion without obtaining the prior consent of the Indemnified Party.  The Indemnified Party shall at all times have the right, at its option and Expense, to participate fully in, but not to control, any such defense.  If the Indemnifying Party, within 20 days after receipt of the Indemnified Party's notice of claim, does not (i) give such notice to take over the defense of such claim and proceed diligently to defend the claim or (ii) object to such claim in writing to the Indemnified Party, then the Indemnified Party shall have the right, but not the obligation, to undertake the defense of such claim for the account of and at the risk of the Indemnifying Party.  The Parties shall cooperate in defending any third Person claim, and the defending party shall have reasonable access to the books, records and personnel which are pertinent to the defense and which are in the possession or control of the other party.  The Parties agree that any Indemnified Party, at its own expense, may join an Indemnifying Party in any action, claim or proceeding brought by a third Person, as to which any right of indemnity created by this Agreement would or might apply, for the purpose of enforcing any right of indemnity granted to such Indemnified Party pursuant to this Agreement.

(a)                 Any claim for indemnification made directly by a Party and which does not result from a third Person claim or action, shall be asserted by written notice.  The Indemnifying Party shall have a period of 45 days within which to respond thereto.  If the Indemnifying Party does not respond within such 45‑day period, such Party shall be deemed to have accepted responsibility to make payment and shall have no further right to contest the validity of such claim. 

(b)                 Notwithstanding anything to the contrary, (i) no investigation by or knowledge of Buyer shall affect or limit Buyer's rights to indemnity contained in this Article 11, and (ii) Buyer's inability to recover for Losses under Section 11.3(a)(i) (whether due to the scope of a particular representation or warranty or otherwise) shall not preclude Buyer from recovering under any other subsection of Section 11.3(a), each such subsection being an independent basis for indemnification.

(c)                 The Parties acknowledge that the provisions of Section 13.7 and that the same applies to all indemnity claims hereunder

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11.5            Limitation on Recovery

With respect to any Losses for which indemnification is sought pursuant to Section 11.3, the Seller shall not be liable, except in the case of fraud, for any Losses relating to any matter to the extent that a specific liability or reserve relating to the matter was taken into account in the calculation of Net Working Capital as reflected in the Final Net Working Capital Statement. With respect to any Losses for which indemnification is sought pursuant to Section 11.2 or Section 11.3, the Indemnifying Party shall not be liable, except in the case of fraud, for any special, consequential or punitive damages, including loss of profits or goodwill, except (i) to the extent a Governmental Authority has required, or a third party settlement has provided (to the extent the Indemnifying Party has consented to the settlement and the amounts payable thereof, which consent shall not be unreasonably withheld), such amounts to be paid to a third Person or (ii) with respect to consequential damages, as provided in Section 8.27.

11.6            Duty to Mitigate

(a)                 Each Indemnified Party shall use its commercially reasonable efforts to mitigate Losses for which indemnification may be sought pursuant to Section 11.2 or Section 11.3, including (i) using its commercially reasonable efforts to secure payment from insurance policies available and in existence (including the Environmental Insurance) that provide coverage with respect to such Losses (an "Insurance Payment") and (ii) using its commercially reasonable efforts to secure reimbursement, indemnity or other payment from any third Person obligated by Contract or otherwise to reimburse, indemnify or pay the Indemnified Party with respect to such Loss (a "Third Party Payment" and, together with an Insurance Payment, a "Mitigation Payment"), it being understood and agreed that the Indemnified Party shall not be required to exhaust or conclude its remedies with respect to such Mitigation Payments prior to seeking indemnification from the Indemnifying Party under Section 11.2 or Section 11.3, as the case may be.  Notwithstanding anything to the contrary contained herein, the recovery by an Indemnified Party from any Indemnifying Party pursuant to Section 11.2 or Section 11.3, as the case may be, shall not relieve the Indemnified Party of its obligation to mitigate Losses pursuant to this Section 11.6(a).

(b)                 Any amounts payable by an Indemnifying Party with respect to a particular Loss pursuant to Section 11.2 or Section 11.3, as the case may be, shall be reduced by the amount of Mitigation Payment, if any, received by the Indemnified Party with respect to such Loss prior to payment therefor by the Indemnifying Party.  In the event an Indemnifying Party makes a payment with respect to a particular Loss pursuant to Section 11.2 or Section 11.3, as the case may be, and thereafter the Indemnified Party receives a Mitigation Payment with respect to such Loss, the Indemnified Party shall reimburse the Indemnifying Party an amount equal to the lesser of (i) the Mitigation Payment and (ii) the amount so paid by the Indemnifying Party.

(c)                 The Parties agree to treat indemnification payments as an adjustment to the Purchase Price.

(d)                 The Parties acknowledge and agree that a Party's reporting to a Governmental Authority under a good faith belief of a duty to report under applicable Law does not violate the Party's duty to mitigate.

11.7            Escrow Fund

At the Closing, the Escrow Amount shall be deposited by Buyer with the Escrow Agent, such deposit to constitute an escrow fund (the "Escrow Fund") and to be governed by the terms set forth herein and in the Escrow Agreement.  The Escrow Fund shall be available as security for the indemnification obligations of Seller for any Warranty Breach pursuant to Section 11.3(a)(i).  Buyer shall pay all fees and expenses of the Escrow Agent in connection with the administration of the Escrow Fund.

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11.8            Indemnity is the Exclusive Remedy

Each Party acknowledges and agrees that after the Closing Date, absent fraud, its sole and exclusive remedy with respect to any and all claims relating to or arising out of any representation, warranty, covenant or agreement made by the other Party (or its Subsidiaries) in the Operative Agreements shall be pursuant to the indemnification provisions of this Article 11; provided, however, that in the event of any Warranty Breach arising under Section 5.25 (Sufficiency), Seller may, in its sole discretion and in lieu of payment of money damages, cure such breach by delivering or otherwise conveying sufficient rights to the asset or assets in question giving rise to such Warranty Breach; provided further that to the extent any provision in this Agreement (other than this Article 11) or any other Operative Agreement expressly creates an indemnity obligation in one of the Parties, the provisions of this Article 11 will apply to such provision to the extent not inconsistent therewith.  However, nothing set forth in this Agreement shall be deemed to prohibit or limit either Party's right at any time before, on or after the Closing Date, to seek injunctive or other equitable relief for the failure of the other Party to perform any covenant or agreement contained in any Operative Agreement, and the pursuit of injunctive relief shall not affect, modify or diminish in any way a Party's right to monetary relief in arbitration pursuant to Section 13.7(b).

11.9            Assignment of Claims

If an Indemnified Party receives any payment from an Indemnifying Party in respect of any Loss pursuant to Section 11.2 or Section 11.3 and the Indemnified Party could reasonably have recovered all or a part of such Loss from a third Person (a "Potential Contributor") based on the underlying claim asserted against the Indemnifying Party, the Indemnified Party shall assign such of its rights to proceed against the Potential Contributor but only to the extent necessary to permit the Indemnifying Party to recover from the Potential Contributor the amount of such payment.

11.10         No Set‑Off

Neither Party may set‑off Losses against other payments to be made by the respective Party pursuant to this Agreement or any other Operative Agreement without the written consent of the other Party.

Article 12

TERMINATION

12.1            Term

Unless terminated pursuant to Section 12.2 or as otherwise expressly set forth herein, this Agreement shall continue in full force and effect until full and final performance of all of the terms herein.

12.2            Termination

Anything contained in this Agreement to the contrary notwithstanding, this Agreement may be terminated at any time prior to the Closing Date:

(a)                 by the mutual signed written consent of Buyer and Seller;

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(b)                 by either Party if:

(i)            a Law is in effect having the effect of permanently restraining, enjoining or otherwise prohibiting, in a material respect, the consummation of the transactions contemplated by this Agreement, which Law is final and nonappealable (and for the avoidance of doubt, the Buyer shall have no right to terminate this Agreement pursuant to this Section 12.2(b)(i) by reason of the fact that it is in breach of the UK OFT Undertakings); or

(ii)            the Closing shall not have occurred on or before the End Date; provided, however, that the failure of the Closing to occur is not due to a material breach hereof by the Party seeking termination;

(c)                 by Buyer:

(i)            in the event of a Warranty Breach or Covenant Breach by Seller such that the conditions set forth in Section 9.6 or Section 9.2, as applicable, would not be satisfied; provided, however, that Seller is given notice to cure such breach and does not cure such breach within 60 days after receipt of notice from Buyer requesting such breach be cured; or

(ii)            if a Seller Material Adverse Effect shall have occurred since the date hereof; or

(d)                 by Seller:

(i)            if a Buyer Material Adverse Effect shall have occurred since the date hereof; or

(ii)            in the event of a Warranty Breach or Covenant Breach by Buyer such that the conditions set forth in Section 10.6 or Section 10.2, as applicable, would not be satisfied; provided, however, that Buyer is given notice to cure such breach and does not cure such breach within 60 days after receipt of notice from Seller requesting such breach be cured.

12.3            Notice of Termination

Any Party desiring to terminate this Agreement pursuant to Section 12.2 shall give written notice of such termination to the other Party.

12.4            Effect of Termination

In the event that this Agreement shall be validly terminated pursuant to this Article 12, this Agreement shall forthwith terminate and be of no further force and effect; provided, however, that (a) any agreements contained herein that expressly provide for survival after termination of this Agreement and Section 8.15 and Article 13 shall survive the termination hereof, and (b) nothing herein shall relieve any Party from liability for any willful breach of this Agreement or fraud arising prior to such valid termination.  Termination of this Agreement shall not limit the Liability of any Party except as otherwise expressly provided in this Agreement.

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Article 13

GENERAL PROVISIONS

13.1            Notices

(a)                 Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be delivered in person, transmitted by facsimile (with acknowledgment of complete transmission together with notice by telephone (either to a person or by voice mail message) to the confirmatory telephone numbers below, provided that such confirmatory telephone numbers shall allow for voice mail messages to be left 24 hours per day, seven days per week) or sent by registered or certified mail, or recognized overnight courier, charges prepaid, addressed as follows:

(i)            if to Seller:

Mentor Corporation
201 Mentor Drive
Santa Barbara, California 94311
Attention: Chief Executive Officer, with a copy to the General Counsel
Facsimile No.:      (805) 879-6008
Phone: (805) 879-6000 (for confirmation purposes only)

with a copy to (which shall not constitute notice):

Wilson Sonsini Goodrich & Rosati
Professional Corporation
650 Page Mill Road
Palo Alto, CA 94304
Attention:              Bradley Finkelstein, Esq.
                                Martin Korman, Esq.
Facsimile No.:      (650) 493-6811
Phone: (650) 493-9300 (for confirmation purposes only)

(ii)            if to Buyer:

Coloplast A/S
Holtedam 1
3050 Humlebaek
Denmark
Attn: Peter Volkers
Facsimile No.:      011-45 (country code) -49-11-24-10
Phone: 011-45 (country code) - -49-11-16-13 (for confirmation purposes only)

with a copy to (which shall not constitute notice):

Welch Spell, PC
Suite 1750
1170 Peachtree Street, N.E.
Atlanta, GA  30309
Attention: Laurance D. Pless, Esq.
                        Robert Sauro, Esq.
Facsimile No.:      (404) 875-0798
Phone: (404) 885-5229 (for confirmation purposes only)

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(b)                 Any such notice or other communication shall be deemed to have been given and received on the day on which it was personally delivered or transmitted by facsimile, receipt of complete transmission confirmed (or, if such day is not a Business Day, on the next following Business Day) or, if mailed, by registered or certified mail, on the third Business Day following the date of mailing or, if couriered overnight, on the next following Business Day; provided, however, that if at the time of mailing or within three Business Days thereafter, there is or occurs a labor dispute or other event that might reasonably be expected to disrupt the delivery of documents by mail, any notice or other communication hereunder shall be delivered or transmitted by means of overnight courier as set forth above.

(c)                 Either Party may change its address for service and/or notice at any time by giving notice to the other Party in accordance with this Section 13.1.

13.2            Currency

Unless otherwise indicated, all dollar amounts referred to in this Agreement are expressed in United States dollars.

13.3            Sections and Headings

Unless otherwise specified herein, any reference in this Agreement to an Article, Section, paragraph, Schedule or Exhibit refers to the specified Article, Section or paragraph of, or Schedule or Exhibit to, this Agreement.  In this Agreement, the terms "this Agreement", "hereof", "herein", "hereunder" and similar expressions refer to this Agreement and not to any particular part, Article, Section, paragraph or other provision hereof.

13.4            Rules of Construction

Unless the context otherwise requires, in this Agreement:

(a)                 words importing the singular number only shall include the plural and vice versa and words importing the masculine gender shall include the feminine and neuter genders and vice versa;

(b)                 the word "or" may be conjunctive or disjunctive, as the context may require;

(c)                 the words "include", "includes", "including" and "particularly" means "include", "includes" or "including", in each case, "without limitation";

(d)                 reference to any agreement or other instrument referred to herein shall mean such agreement or other instrument as amended, modified, replaced or supplemented from time to time to the extent permitted by applicable provisions thereof and by this Agreement;

(e)                 reference to any statute shall be deemed to be a reference to such statute as amended, re enacted or replaced from time to time;

(f)                  if there is any conflict or inconsistency between the provisions contained in the body of this Agreement and those of any Schedule or Exhibit hereto, the provisions contained in the body of this Agreement shall prevail;

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(g)                 time periods within which a payment is to be made or any other action is to be taken hereunder shall be calculated excluding the day on which the period commences and including the day on which the period ends; and

(h)                 whenever any payment to be made or action to be taken hereunder is required to be made or taken on a day other than a Business Day, such payment shall be made or action taken on the next following Business Day.

13.5            Construction

The Parties acknowledge that their respective legal counsel have reviewed and participated in settling the terms of this Agreement and that any rule of construction to the effect that any ambiguity is to be resolved against the drafting party, shall not be applicable in the interpretation of this Agreement.

13.6            Entire Agreement

This Agreement, together with the agreements specifically contemplated herein or entered into or delivered in connection herewith, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, written and oral, with respect to the subject matter hereof (including the Offer Letter and the Exclusivity Agreement but excluding the Confidentiality Agreement).  There are no conditions, covenants, agreements, representations, warranties or other provisions, express or implied, collateral, statutory or otherwise, relating to the subject matter hereof except as herein provided or as provided in other documents executed and delivered by the Parties in connection herewith.

13.7            Governing Law; Jurisdiction and Venue; Arbitration of Indemnification Disputes; Injunctive Relief

(a)                 This Agreement shall be governed by, and construed in accordance with, the Laws of the State of Minnesota, without regard to any conflicts of law principles.  The parties hereto irrevocably submit to the exclusive jurisdiction of the United States District Court located in Minneapolis, Minnesota for the purposes of any suit, action or other proceeding arising out of this Agreement or any transaction contemplated hereby (except for claims, disputes or controversies arising out of or relating to Article 11 (including all its subsections), which shall be governed by subsection (b) below).  Each of the parties hereto, further agrees that service of any process, summons, notice or document by U.S. registered mail to such party's respective address set forth in Section 13.1 shall be effective service of process for any action, suit or proceeding in Minneapolis, Minnesota with respect to any matters to which it has submitted to jurisdiction as set forth above in the immediately preceding sentence.  Each of the parties hereto irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding set forth above arising out of this Agreement or the transactions contemplated hereby, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.

(b)                 Any claims, disputes or controversies arising out of or relating to Article 11 (including all its subsections), including any dispute concerning arbitrability or the scope of this arbitration clause, shall be exclusively settled by binding arbitration pursuant to the Commercial Rules ("Rules") of the American Arbitration Association ("AAA") (it being expressly understood and agreed that any such claims, disputes and remedies shall be subject to the provisions of Article 11, including but not limited to Section 11.8 thereof).  Notwithstanding anything to the contrary, arbitration may be commenced at any time following the expiration of the last counternotice period provided in subsection (b) above by any Party hereto in Minneapolis, Minnesota, by giving written notice to AAA in such place, and to each other Party, that such claim or dispute has been referred to arbitration under this Section 13.7(b).  The arbitration proceedings shall be conducted, using Minnesota law, and applicable federal law, before a single neutral arbitrator (or, in the case of a claim exceeding One Million Five Hundred Thousand Dollars ($1,500,000), before a panel of three (3) neutral arbitrators), each of whom shall have experience with mergers and acquisitions.  Any award rendered by the arbitrator(s) shall be conclusive, final and binding upon the Parties hereto, and nonappealable to any court or forum; provided, however, that any such award shall be accompanied by a concise written opinion giving the reasons for the award.  Judgment upon such award may be entered in any court of competent jurisdiction.  Each Party shall pay its own expenses of arbitration. 

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13.8            Waiver of Jury Trial

Each Party hereby waives, to the fullest extent permitted by applicable Laws, any right it may have to a trial by jury with respect to any litigation directly or indirectly arising out of, under or in connection with this Agreement, the other Operative Agreements or the transactions contemplated hereby or thereby.  Each Party hereby (a) certifies that no representative, agent or counsel of the other Party has represented, expressly or otherwise, that the other Party would not, in the event of litigation, seek to enforce the foregoing waiver, and (b) acknowledges that it and the other Party have been induced to enter into the Operative Agreements by, among other things, the mutual waivers and certifications contained in this Section 13.8.

13.9            Public Announcement

The Parties shall consult with each other before issuing any press release or making any other public announcement with respect to this Agreement or the transactions contemplated hereby and, except as required by any applicable Laws, regulatory requirement or the rules of any national or foreign stock exchange upon which their respective securities are listed for trading, neither of them shall issue any such press release or make any such public announcement without the prior written consent of the other, which consent shall not be unreasonably withheld, delayed or conditioned.

13.10         Expenses

Except as otherwise provided herein, each Party shall be responsible for all expenses incurred by it and its Subsidiaries (it being understood that effective upon the Closing, the Transferred Subsidiaries shall become Subsidiaries of Buyer), respectively, in connection with the negotiation and settlement of this Agreement and the Operative Agreements and the completion of the transactions contemplated hereby and thereby.

13.11         Exclusion of Certain Damages

EXCEPT AS SPECIFICALLY SET FORTH IN SECTION 11.5 OR IN THE CASE OF FRAUD, NEITHER BUYER (INCLUDING BUYER'S SUBSIDIARIES) NOR SELLER (INCLUDING SELLER'S SUBSIDIARIES) SHALL BE RESPONSIBLE FOR ANY SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES WHATSOEVER, INCLUDING LOSS OF PROFITS OR GOODWILL, IN CONNECTION WITH ANY ASPECT OF THIS AGREEMENT OR THE OTHER OPERATIVE AGREEMENTS.

13.12         Severability

If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such determination shall not impair or affect the validity, legality or enforceability of the remaining provisions hereof, and each provision is hereby declared to be separate, severable and distinct.  To the extent that any such provision is found to be invalid, illegal or unenforceable, the Parties shall act in good faith to substitute for such provision, to the extent possible and as necessary, a new provision with content and purpose as close as possible to the provision so determined to be invalid, illegal or unenforceable.

68

13.13         Successors and Assigns

This Agreement shall inure to the benefit of and shall be binding on and enforceable by the Parties and their respective successors and permitted assigns.  Neither Party may assign any of its rights or obligations hereunder, by operation of law or otherwise, without the prior written consent of the other Party, which consent shall not be unreasonably withheld, delayed or conditioned; provided, however, that Buyer may assign or delegate its rights, obligations or liabilities under this Agreement in whole or in part to one or more Subsidiaries of Buyer without the consent of Seller if and so long as Buyer shall remain fully liable for the fulfillment of all such obligations; provided, further, that Seller may assign any of its rights or obligations under this Agreement in connection with a transfer or sale of all or substantially all of Seller's assets provided that the assignee agrees to be bound by the terms and provisions of this Agreement.  Buyer and Buyer Subsidiaries shall have the right without consent of Seller to assign their rights under this Agreement and the other Operative Agreements as collateral to their respective lenders after reasonable prior notice to the other Party.  Any purported assignment in violation of this Section 13.13 shall be void and no assignment by Buyer or Seller to a Subsidiary thereof will relieve Buyer or Seller from any of their respective obligations hereunder.  Nothing herein expressed or implied is intended or should be construed to confer upon or give to any Person other than the parties hereto and their representatives, successors and assigns any rights or remedies under or by reason of this Agreement.

13.14         Amendment and Waivers

No amendment, modification or waiver of, or supplement to, any provision of this Agreement shall be binding on any Party unless consented to in writing by such Party.  No waiver of any provision of this Agreement shall constitute a waiver of any other provision, and no waiver shall constitute a continuing waiver unless otherwise provided.

13.15         Counterparts

This Agreement may be executed in counterparts, each of which shall constitute an original and all of which taken together shall constitute one and the same instrument.

IN WITNESS WHEREOF, each of Buyer and Seller has caused this Agreement to be executed by its duly authorized representative as of the date and year first written above.

MENTOR CORPORATION		COLOPLAST A/S
By:	/s/JOSHUA H. LEVINE	By:	/s/STEN SCHEIBYE
	Joshua H. Levine		Sten Scheibye
	Chief Executive Officer		Chief Executive Officer

69

PURCHASE AGREEMENT

by and between

MENTOR CORPORATION

and

COLOPLAST A/S

dated May 17, 2006

EX-2

EXHIBIT 2.4 

Seller Listing Schedules

Page 1 of 179

Attached hereto are the schedules to that certain Purchase Agreement dated as of May 17, 2006 (the “Agreement”), by and between Mentor Corporation, a Minnesota corporation (“Seller”), and Coloplast A/S, a Danish corporation (“Buyer”) (Buyer and Seller may hereinafter be referred to individually as a “Party” and collectively as the “Parties”), and constitutes the “Schedules” as defined in Section 1.140 of the Agreement. Unless otherwise noted herein, any capitalized term used in the Schedules shall have the same meaning assigned to such term in the Agreement.

The Schedules are qualified in their entirety by reference to specific provisions of the Agreement. The section numbers used in the Schedules correspond to the section numbers of the Agreement.

Where the terms of a contract, lease, agreement or other disclosure item have been summarized or described in the Schedules, such summary or description does not purport to be a complete statement of the material terms of such contract, lease, agreement or other disclosure item and such summaries are qualified in their entirety by the specific terms of such agreements or documents.

By shareholder action dated September 26, 2002, Porges was transformed from an SA stock corporation (“société anonyme”) to an SAS simplified stock corporation (“société par actions simplifiée”). Any references to Porges, Porges SA and Porges SAS refer to one and the same entity.

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Schedule 1.6

Assumed Liabilities

Subject in each case to Seller’s indemnification obligations to the Buyer Indemnified Parties pursuant to Section 11.3 of the Agreement, the following constitute Assumed Liabilities.

1.   All accounts payable and all other liabilities of Seller and its Subsidiaries listed on the Final Statement, including but not limited to accrued royalties, sales returns and rebates, notes payable (acquisition-related) and deferred revenue, travel and consulting fees, property tax fees and pension obligations, other than items listed on Schedule 1.60 (Excluded Liabilities).

2.   The following Liabilities, whether or not listed on the Final Statement:

a.   All Liabilities arising on or after the Closing relating to the operation of the Business by Buyer, the Transferred Assets and/or the Transferred IPR, including Liabilities for any infringement of the IPR of third Persons arising from the operation of the Business following the Closing including the sale of products by Buyer following the Closing.

b.   All Liabilities relating to milestone or future payments under Transferred Contracts becoming due after Closing.

c.   All Liabilities (including attorneys’ fees and costs of defense) arising out of or resulting from any sale of the Products, whether prior to or on or after the Closing, including agreements of indemnification, guaranty or warranty relating to the Products and any Product Liability Claims, other than (i) Liabilities (including attorneys’ fees and costs of defense) with respect to written claims delivered to Seller and/or its Subsidiaries prior to the Closing and (ii) Liabilities (including attorneys’ fees and costs of defense) with respect to Product Liability Claims that constitute Excluded Liabilities, including those Excluded Liabilities under paragraphs 1 and 9 of Schedule 1.60.

d.   All Buyer Employment Liabilities assumed by Buyer pursuant to Section 7.6 and all other Liabilities related to the Transferred Employees other than Seller Employment Liabilities.

e.   All Liabilities to be borne by Buyer pursuant to Section 8.1.

f.   All Liabilities of Seller and its Subsidiaries to customers or patients for the repair, replacement or return of, or credit for, Products sold prior to or on or after the Closing.

3.   All Taxes that Buyer has agreed to pay pursuant to the Agreement including, without limitation, all Taxes that are the responsibility of Buyer pursuant to Section 8.7(a)(ii) and Buyer’s portion of any Transfer Taxes pursuant to Section 8.7(c).

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Schedule 1.6

Assumed Liabilities

Subject in each case to Seller’s indemnification obligations to the Buyer Indemnified Parties pursuant to Section 11.3 of the Agreement, the following constitute Assumed Liabilities.

1.   All accounts payable and all other liabilities of Seller and its Subsidiaries listed on the Final Statement, including but not limited to accrued royalties, sales returns and rebates, notes payable (acquisition-related) and deferred revenue, travel and consulting fees, property tax fees and pension obligations, other than items listed on Schedule 1.60 (Excluded Liabilities).

2.   The following Liabilities, whether or not listed on the Final Statement:

a.   All Liabilities arising on or after the Closing relating to the operation of the Business by Buyer, the Transferred Assets and/or the Transferred IPR, including Liabilities for any infringement of the IPR of third Persons arising from the operation of the Business following the Closing including the sale of products by Buyer following the Closing.

b.   All Liabilities relating to milestone or future payments under Transferred Contracts becoming due after Closing.

c.   All Liabilities (including attorneys’ fees and costs of defense) arising out of or resulting from any sale of the Products, whether prior to or on or after the Closing, including agreements of indemnification, guaranty or warranty relating to the Products and any Product Liability Claims, other than (i) Liabilities (including attorneys’ fees and costs of defense) with respect to written claims delivered to Seller and/or its Subsidiaries prior to the Closing and (ii) Liabilities (including attorneys’ fees and costs of defense) with respect to Product Liability Claims that constitute Excluded Liabilities, including those Excluded Liabilities under paragraphs 1 and 9 of Schedule 1.60.

d.   All Buyer Employment Liabilities assumed by Buyer pursuant to Section 7.6 and all other Liabilities related to the Transferred Employees other than Seller Employment Liabilities.

e.   All Liabilities to be borne by Buyer pursuant to Section 8.1.

f.   All Liabilities of Seller and its Subsidiaries to customers or patients for the repair, replacement or return of, or credit for, Products sold prior to or on or after the Closing.

3.   All Taxes that Buyer has agreed to pay pursuant to the Agreement including, without limitation, all Taxes that are the responsibility of Buyer pursuant to Section 8.7(a)(ii) and Buyer’s portion of any Transfer Taxes pursuant to Section 8.7(c).

4.   Any and all Liabilities in connection with the Business, Real Property and/or the Transferred Assets arising at any time (past, present or future) out of, in connection with or relating to: (i) Environmental Claims, (ii) Environmental Conditions, (iii) Environmental Permits or the violation of Environmental Laws, excluding, in all cases, the Seller’s Environmental Indemnification Obligations.

5.   All Liabilities of Mentor Benelux B.V. related to the Transferred Business (provided that (i) Liabilities for Product Liability Claims shall be subject to the provisions of paragraph 2.c. above and (ii) Liabilities for Environmental Claims, Environmental Conditions, Environmental Permits or the violation of Environmental Laws shall be subject to paragraph 4 above).

Notwithstanding anything in the Agreement or the Schedules to the contrary, it is understood that Buyer shall assume all Liabilities of Transferred Subsidiaries by virtue of Buyer’s acquisition of the Transferred Equity Interests, other than items listed on Schedule 1.60 (Excluded Liabilities).

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Schedule 1.59

Excluded Assets

All of Seller’s and its Subsidiaries’ right, title and interest in and to:

1.   The Infrastructure Assets.

2.   All IPR of Seller and its Subsidiaries, other than the Transferred IPR.

3.   All amounts received or recognized by Seller or any of its Subsidiaries with respect to the Transferred IPR, including for the infringement thereof by third parties, prior to the Closing, other than the receipt of the proceeds of the Porges Asset Sale.

4.   All Employee Benefit Plan assets held by Seller or one of its Subsidiaries (other than a Transferred Subsidiary) for the benefit of Employees.

5.   All Contracts to which Seller or one of its Subsidiaries is a party, other than the Transferred Contracts and the Assigned Leases.

6.   All cash, certificates of deposit, cash equivalents and short-term investments of Seller and its Subsidiaries.

7.   All Equity Interests beneficially owned by Seller or one of its Subsidiaries in any Person, other than the Transferred Equity Interests.

8.   Any rights relating to the Transferred Assets, which arise prior to the Closing and for which Seller or any of its Subsidiaries (other than a Transferred Subsidiary) has suffered Losses or made a claim against a third party in connection with potential Losses relating to such Transferred Assets.

9.   All personnel records (other than the Transferred Employee Records), all records and documents prepared in connection with the transactions contemplated hereby (other than such records and documents or copies thereof to be delivered to Buyer or a Subsidiary thereof pursuant to the express terms of an Operative Agreement) and all other personnel records or documents that Seller (or a Subsidiary thereof) is required by Law to retain in its possession.

10.   All rights of Seller and its Subsidiaries (other than the Transferred Subsidiaries) under any of the Operative Agreements.

11.   All interest of Seller and its Subsidiaries in real property, other than as contemplated under the Operative Agreements.

12.   All insurance policies and any rights, claims or choses in action under such insurance policies, except for Transferred Contracts.

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13.   All of Seller’s enterprise-wide procurement Contracts, other than Transferred Contracts.

14.   Office furniture and office equipment, fixtures and leasehold improvements at all locations other than at the Real Property.

15.   All other assets, tangible and intangible, of Seller (or a Subsidiary thereof) that do not comprise the Transferred Assets, including any physical or tangible copy of any work of authorship (whether in electronic, written or other media) or other Technology, which is embodied by, or relates to, any Excluded Assets.

16. Any and all of Seller’s and Seller’s Subsidiary’s (including the Transferred Subsidiaries) assets used exclusively in aesthetics.

17. All ObTape® brand products, including any components thereof, any instruments or other accessories sold in conjunction with and for use strictly with ObTape®, and Marks, advertising and marketing materials used strictly with ObTape®.

18. Any and all of Seller’s and Seller’s Subsidiary’s (including the Transferred Subsidiaries) assets with respect to dermal fillers and other bulking agents and toxins, including botulinum toxins.

19. The manufacturing facility in Anoka, Minnesota, the assets contained therein and any other assets (including, without limitation, all confidential information, Patents, Trade Secrets and other IPR with respect thereto) used or necessary for the production of silicone male external catheters therein.

20. The assets set forth on Annex A hereto.

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Schedule 1.60

Excluded Liabilities

Subject in each case to Buyer’s indemnification obligations to the Seller Indemnified Parties pursuant to Section 11.2 of the Agreement, the following constitute Excluded Liabilities.

1.   All Liabilities (including attorneys fees’ and costs of defense) relating to the ObTape® brand products, including any components thereof, and any instruments or other accessories sold in conjunction with and for use strictly with ObTape®, other than with respect to any sales by or on behalf of Buyer of ObTape® brand products, including any components thereof, and any instruments or other accessories sold in conjunction with and for use strictly with ObTape®, following the Closing.

2.   All Seller Employment Liabilities with respect to Transferred Employees pursuant to Section 7.7.

3.   All Liabilities to be borne by Seller pursuant to Section 8.1.

4.   Any Liability of Seller or any Subsidiary to any broker, finder or agent for any investment banking or brokerage fees, finder’s fees or commission with respect to the transactions contemplated by this Agreement.

5.   Any Liability of Seller or any Subsidiary for indebtedness for borrowed money.

6.   Any Liability of Seller or any Subsidiary for costs and expenses incurred by Seller or any Subsidiary in connection with the negotiation of (A) this Agreement or (B) the transactions contemplated by this Agreement except as otherwise set forth in the Agreement.

7.   All Pre-Closing Taxes and Seller's portion of any Transfer Taxes pursuant to Section 8.7(c) of the Agreement.

8.   Liabilities arising out of or resulting from any sale of the Products prior to the Closing, including agreements of indemnification, guaranty or warranty relating to the Products (other than, in each case, Product Liability Claims, which are addressed in paragraph 9 below), for which Seller and/or its Subsidiaries have received written claims prior to the Closing.

9.   Liabilities (including attorneys’ fees and costs of defense) arising out of or resulting from Product Liability Claims relating to the Products or arising out of or resulting from any agreement of indemnification, guaranty or warranty in respect of a Product Liability Claim, provided, that in each case: (i) such Liabilities are with respect to Product Liability Claims Made prior to the Closing; or (ii) such Liabilities are with respect to Product Liability Claims Made with respect to Products sold by Seller, which claims are Made on or before the seventh (7^th) anniversary of the Closing Date, provided that Buyer shall have the burden of proof to establish that the Products that are the subject of such Product Liability Claims Made under this clause (ii) were sold by Seller.

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10.   All litigation pending before a court or arbitrator as of the Closing Date, and any litigation rising out of the same underlying facts or circumstances as those alleged in the aforementioned pending litigation.

11. All past, present and future obligations to South Bay Medical LLC under the Purchase and Sale Agreement dated January 19, 2001 between Seller and South Bay Medical LLC.

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Schedule 1.79

Infrastructure Assets

The assets set forth on Annex B hereto.

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Schedule 1.84(a)

Individuals (Knowledge)

David J. Adornetto, Vice President, Operations

David Amerson, Vice President Urology Sales & Marketing

Jerry R. Barber, Vice President, Research

Kathleen M. Beauchamp, Vice President, Sales & Marketing

A. Chris Fawzy, Vice President and General Counsel

Kristine Foss, Vice President, Clinical Affairs and Regulatory Submissions

Tom Garcia, Associate Counsel

Adri Hoogwerf, President (Porges SAS)

Joshua H. Levine, President and Chief Executive Officer

Karun Naga, Intellectual Property Counsel

Loren L. McFarland, Vice President and Chief Financial Officer

Tim Palmer, Vice President Manufacturing Operations (Minnesota)

Clarke L. Scherff, Vice President, Regulatory Compliance & Quality

Tom Springer Vice President of Manufacturing Operations (MBI)

Cathryn S. Ullery, Vice President, Human Resources

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Schedule 1.84(b)

Individuals (Knowledge)

John Anderson, Director of Marketing, Health Care

Jean Christophe Bizon, Directeur International Urology and Healthcare Branches (France)

Brigitte Congard-Chassol, Regulatory Affairs Manager (France)

Delia Cook

Travis Gay, National Sales Manager

Udo Graf, Corporate Vice President of Development

Jean-Yves Henry, Finances (France)

Franck Lespinasses, Quality and Regulatory Division

Frederic Marie, R&D Manager (France)

Keith Modert, R&D Manager

Vincent Monsaignon, Medical & Marketing Director (France)

Herve Perez, Operations (France)

Lisa Reich, Director of Marketing

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Schedule 1.94

Licensed Patents

Patent No.	Title	Filed	Issued
US 4,890,866	Tubing Connector	March 14, 1989	January 2, 1990

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Schedule 1.104

Net Working Capital

“Net Working Capital” means the difference between:

(1) the sum of the following line items:

- trade accounts receivable, net of allowance for doubtful accounts (including any outstanding accounts receivable from a Subsidiary of Seller that is not a Transferred Subsidiary that was not terminated pursuant to Section 8.28 of the Agreement)

- trade inventory, net of inventory reserves

- prepaid literature

- royalties and other employee receivables

- other prepaid assets (excluding prepaid events)

- construction in process for projects approved by Buyer

AND

(2) the sum of the following line items:

- trade accounts payable (including any outstanding trade accounts payable that are payable to Seller or its Subsidiaries (other than the Transferred Subsidiaries) that was not terminated pursuant to Section 8.28 of the Agreement)

- accrued royalties

- accrued compensation (excluding any retention bonuses paid or payable to employees)

- income taxes payable

- other Accrued Liabilities excluding Accrued Product Liability (including sales rebates. accrued liabilities ,volume discounts , travel and consulting fees, A/P, accrued legal fees and accrued sales taxes and V.A.T.)

- sales returns

- warranty reserves without product liability reserves, and

- short-term portion of deferred revenue

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In each case as such items are reflected on a balance sheet of the Business prepared on a basis consistent with the Year-End Financials and the Most Recent Balance Sheet.

For purposes of calculating Net Working Capital and Net Working Capital Target, all amounts shall be presented on a constant exchange rate basis.

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Schedule 1.115

Permitted Encumbrances - U.S. Real Property

Minnesota

Address:

1499, 1525, 1601 and 1615 West River Road

Minneapolis, Minnesota

Specified Permitted Encumbrances:

1.Easement for electric transmission line purposes, together with any incidental rights, in favor of Northern States Power Company, a Minnesota corporation, as contained in the Underground Easement, dated July 2, 1971, recorded July 7, 1971, as Document No. 3893463; and as reserved in the Quit Claim Deed, dated September 3, 1971, recorded December 22, 1971, as Document No. 3923389.

2.Easement for electric transmission line purposes, together with any incidental rights, in favor of Northern States Power Company, a Minnesota corporation, as contained In the Easement, dated March 29, 1974, recorded April 15, 1974, as Document No. 4076568.

3.Easement for electric transmission line purposes, together with any incidental rights, in favor of Northern States Power Company, a Minnesota corporation, as contained in the Underground Easement, dated May 31, 1974, recorded June 18, 1974, as Document No. 4088868.

4.Covenants, conditions, restrictions, obligations, provisions, and easements as contained in the Reciprocal Easement Agreement, dated December 14,1977, recorded May 22,1978, as Document No.4379570; as modified by the Amendment to Reciprocal Easement Agreement, dated March 30, 1978, recorded May 22, 1978, as Document No. 4379571.

5.Easement for utility purposes, together with any incidental rights, in favor of the City of Minneapolis and Minnegasco, as contained in the Resolution No. 95R-208, dated July 24, 1995, recorded July 28, 1995, as Document No. 6456575.

6.Covenants, conditions, restrictions, obligations, provisions, and easements as contained in the Declaration of Covenants and Restrictions for 1401-1501 West River Road North, Minneapolis, Minnesota, dated June 30, 1977, recorded September 28, 1977, as Document No.4320414; as modified by the Amendment to Declaration of Covenants and Restrictions, dated February 2, 1978, recorded February 16, 1978, as Document No. 4357570.

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7.Covenants, conditions, restrictions, obligations, provisions, and easements as contained in the Declaration of North River Road Industrial Condominium Apartment Ownership No. 96, dated December 5, 1977, recorded March 9, 1978, as Document No. 4362001; and by the Floor Plans, recorded March 9, 1978, as Document No. 4362002; as modified by the Amendment No. 1 to Declaration of North River Road Industrial Condominium Apartment Ownership No. 96 and the attached Amended Floor Plan, dated September 29, 1989, recorded October 6, 1989, as Document No. 5581512.

8.Easement for electric transmission line purposes, together with any incidental rights, in favor of Northern States Power Company, a Minnesota corporation, as contained In the Easement, dated July 7, 1995, recorded July 19, 1995, as Document No. 6452744.

9.Easement for utility purposes, together with any incidental rights, in favor of the City of Minneapolis and Minnegasco, as contained in the Resolution No. 98R-380, dated October 19, 1998, recorded October 19, 1998, as Document No. 6988253; and also recorded November 9, 1998, as Document No. 6999727.

10.Mortgage executed by Benson-Orth Associates, Inc., a Minnesota corporation, as mortgagor, to The Farmers and Mechanics Savings Bank of Minneapolis, as mortgagee, dated May 23, 1974, recorded June 5, 1974, as Document No. 4086109.

11.Combination Mortgage, Security Agreement and Fixture Financing Statement executed by Dwayne E. Borg and Maxine E. Borg, his wife, as mortgagor, to The Farmers and Mechanics Savings Bank of Minneapolis, as mortgagee, dated September 25, 1978, recorded October 2, 1978, as Document No. 4416300.

The Mortgage shown above has been assigned to D&N Savings Bank, FSB as shown by the Assignment of Mortgage, dated August 9, 1986, recorded September 17, 1987, as Document No. 5324978.

12.Assignment of Rents and Leases executed by Dwayne E. Borg and Maxine E. Borg, his wife, as assignor, to The Farmers and Mechanics Savings Bank of Minneapolis, as assignee, dated September 25, 1978, recorded October 2, 1978 as Document No. 4416301.

13.Mortgage Loan Agreement executed by Mentor Corporation, a Minnesota corporation, as mortgagor, to the City of Minneapolis, Minnesota, as mortgagee, dated May 1, 1978, recorded August 23, 1978, as Document No. 4404927.

14.Easement for railroad purposes, together with any incidental rights, in favor of Chicago, Saint Paul, Minneapolis and Omaha Railway Company, a Wisconsin corporation, as contained in the Deed, dated August 1, 1969, recorded August 1, 1969, as Document No. 3787478; and as modified by Deed, dated April 7, 1972, recorded June 19, 1972, as Document No. 3952884.

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Oklahoma

Address:

120 N.E. 26^th Street

Oklahoma City, Oklahoma

Specified Permitted Encumbrances:

1.Easement in favor of the City of Oklahoma City recorded in Book 99, Page 505.

2.All items affecting the subject lots as shown on the recorded plat thereof.

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Schedule 1.125(a)

Products (Existing)

Product Description Family Category

1-125 STRANDED	Iodine	BRC
I-125 LOOSE SEEDS	Iodine	BRC
I-125 PRESCRIPTION SEEDS	Iodine	BRC
I-125 ISOLOADER SEEDS	Iodine	BRC
I-125 MICK SEEDS	Iodine	BRC
I-125 SEEDVUE SEEDS	Iodine	BRC
P-103 STRANDED	Palladium	BRC
P-103 LOOSE SEEDS	Palladium	BRC
P-103 PRESCRIPTION SEEDS	Palladium	BRC
P-103 ISOLOADER SEEDS	Palladium	BRC
P-103 MICK SEEDS	Palladium	BRC
P-103 SEEDVUE SEEDS	Palladium	BRC
BRACHY: ISOLOADER / ACC.	BRC Other	BRC
ONC REBATES (ONCOLOGY)	Iodine	BRC
FREEDOM	Freedom MEC-M	Catheters
ACTIVE	Freedom MEC-M	Catheters
URO SAN	Freedom MEC-M	Catheters
GIZMO	Freedom MEC-M	Catheters
OTHER LATEX	Freedom MEC-M	Catheters
CLEAR ADV	Freedom MEC-M	Catheters
FREEDOM CLEAR	Freedom MEC-M	Catheters
OTHER NON-LATEX *	Freedom MEC-M	Catheters
REUSABLE LEG BAGS	Leg Bags-M	Catheters
DISPOSABLE LEG BAGS	Leg Bags-M	Catheters
LEG BAGS ACCESSORY	Leg Bags-M	Catheters

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Product Description Family Category

FEMALE	Self Catheters-M	Catheters
STRAIGHT TIP	Self Catheters-M	Catheters
SOFT CATH	Self Catheters-M	Catheters
PEDIATRIC	Self Catheters-M	Catheters
GUIDE STRIPE	Self Catheters-M	Catheters
COUDE	Self Catheters-M	Catheters
HYDROGEL	HYDROGEL-M	Catheters
CLOSED SYSTEM	Self Catheters-M	Catheters
ACCESSORIES	Self Catheters-M	Catheters
LUBRICIOUS Self Cath	Self Catheters-M	Catheters
MEC	Freedom MEC-M	Catheters
URETHRAL CATH	HC Other	Catheters
LATEX FOLEY CATH	Foley-M	Catheters
DRAINAGE BAGS	Freedom MEC-M	Catheters
TRAYS	Freedom MEC-M	Catheters
STANDARD CARE MISC.	Freedom MEC-M	Catheters
LATEX MEC	Freedom MEC-M	Catheters
NON LATEX MEC	Freedom MEC-M	Catheters
IS CATH	Freedom MEC-M	Catheters
OTHER GYN	HC Other	Catheters
BTA Stat	HC Other	Catheters
MISCELLANEOUS	HC Other	Catheters
POLYTEF (Non-Urology)	Other	ENT
STENTS	Other	Disposable Urology
MISC / CIRCLE NEPH	Other	Disposable Urology
Porges: PROSTATECTOMY	Porges Low	Disposable Urology
Porges: EASIVAC/ELEFANT	Porges Low	Disposable Urology
Porges: DORMIA	Porges Up	Disposable Urology

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Product Description Family Category

MISCELLANEOUS	Other	Disposable Urology
Porges MISC	Other	Disposable Urology
Porges UPPER UROLOGY	Porges Up	Disposable Urology
Porges LOWER UROLOGY	Porges Low	Disposable Urology
Porges OTHER UROLOGY	Porges Oth	Disposable Urology
Porges FOLEY	Foley	Disposable Urology
Porges MEC	Freedom MEC	Disposable Urology
Porges URETHAL CATH	Porges Low	Disposable Urology
Porges URODYNAMICS	Porges Low	Disposable Urology
Porges DRAIN BAGS	Leg Bags	Disposable Urology
Porges ISC	Self Catheters	Disposable Urology
MML OSTOMY CLOSED BAGS	Ostomy	Disposable Urology
MML OSTOMY DRAINAGE BAGS	Ostomy	Disposable Urology
MML OSTOMY OTHER	Ostomy	Disposable Urology
MML FOLEY LATEX	Foley	Disposable Urology
MML FOLEY SILICON	Foley	Disposable Urology
MML MEC	Freedom MEC	Disposable Urology
MML ISC	Self Catheters	Disposable Urology
MML ISC LUBRICIOUS	Self Catheters	Disposable Urology
MML DRAIN BAGS	Leg Bags	Disposable Urology
MML BEDSIDE DRAIN BAGS	Leg Bags	Disposable Urology
MML OTHER HC	Other	Disposable Urology
Porges OTHER	Other	Disposable Urology
MALLEABLE (Regular)	Accuform/Genesis	MH
ACUFORM/Genesis	Accuform/Genesis	MH
ALPHA 1 / TITAN	Titan	MH
ALPHA 1 / TITAN (NARROW)	Titan	MH

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Product Description Family Category

RESERVOIRS	Titan	MH
IPP COMPONENTS	Titan	MH
GEL TESTICULAR	Testiculars	MH
SALINE TESTICULAR	Testiculars	MH
TUTOPLAST	Tutoplast Tissue	WH
AXIS	Tutoplast Tissue	WH
BONE ANCHOR	WH Other	WH
ARIS TOT	Synthetic Sling	WH
PESSARIES	WH Other	WH
EXCEL TWO-PIECE INFLATABLE PENILE PROSTHESIS	IPP	BRC
ISOSTRAND	Isoloader	BRC
ISOLOADER	Isoloader	BRC
ISOLOADER LT	Isoloader	BRC

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Schedule 1.125(b)

Products (Under Development)

Excel Two-Piece Inflatable Penile Prosthesis

Titan One-Touch Release Pump

Soft Solid Testicular Prosthesis

Aris Suprapubic and Transvaginal kit

Novasilk Mesh

Bioflex Coloration

Male Incontinence Projects

Bladder Injection Needle

Hydrogel Douple Loop Stent

Nitinol Dormias

Cobra Single Use Biopsy Gun

Hydrogel Silicone Prostatectomy Catheter

Hydrogel Guidewire

Percutaneous Nephrostomy Introducer Set

Percutaneous Nephrostomy Dilatation Balloon

Double Loop Multilength Biosoft Duo Hydrogel Coated Products

Double Loop Metallic Ring

Aris Kit with Single Use Instruments

Posterior Access Ancillary Instrument

Sterile Vaginal Stent

Valved Catheter

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Antimicrobial Foley

Drug Eluting Catheters

Biologic coated mesh and slings

Antimicrobial slings and meshes

Uniquely Shaped Mesh

POP Repair System and Mesh

I-125 Seed Design

Isoloader II

Endometrial Gel Ablation (Selene)

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Schedule 1.161

Subsidiary Real Property

France

Legal Description of Land	Physical Description
Site called “Lotissement aux Eyrards”
CI 35	Surface: ~643 square meters
CI 36	Surface: ~4,630 square meters
CI 37	Surface: ~1,910 square meters
CI 38	Surface: ~442 square meters
Site called “Lotissement le Pontet ”
CE 50	Surface: ~11,365 square meters
DW 33	Surface: ~1,264 square meters
DW 54	Surface: ~7,157 square meters
Site called “Lotissement la Giragne”
DO 112	Surface: ~929 square meters Green spaces
DP 118	Surface: ~1,031 square meters Green spaces
DO 123	Surface: ~9 square meters Transforming station

United Kingdom

Unit 3

10 Commerce Way

Lancing

West Sussex

United Kingdom

Title Number: WSX17055

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Schedule 1.166

Third Party Licenses

Agreements permitting assignment without consent:

Exclusive Marketing and Distribution Agreement between Advanced Urological Developments and Mentor Corporation, dated June 26, 2002.

Supply Agreement between Porges and Go Medical Pty Ltd, dated December 22, 2000.

License and Consulting Agreement, between Mentor Corporation and Prolapse, Inc., dated October 3, 2005.

Patent License Agreement between Prosurg, Inc. Ashvin Desai and Mentor Corporation and Selene Corporation dated March 21, 2006.

Agreements not expressly permitting assignment without consent, or expressly requiring consent:

Patent License Agreement between Prosurg, Inc., A. Desai and AMI, LLC dated September 2, 2003.

License Agreement between Mentor Urology, Inc. and Saad Juma M.D dated April 7, 1995.

Letter Of Intent Regarding Exclusive License of International Patents to Mentor Corporation between Mentor Corporation and Analytic Biosurgical Solutions (ABISS) dated October 12, 2005.

Letter of Intent Regarding Manufacturing and Supply Agreement between the Mentor Corporation and Porges SAS and ABISS dated May 5, 2004.

License Agreement between Mentor Urology, Inc. and Robert Pelfrey M.D. dated March 10, 1994.

Urinary Bladder Drainage License Agreement between BSI (Surmodics, successor in interest) Corporation and Porges; February 27, 1995, as amended February 27, 1995, as amended June 24, 1999, and as amended December 29, 2004.

Settlement Agreement between Mentor Corporation and American Medical Systems, Inc. dated September 13, 2004.

Non-Exclusive Cross-License Agreement between Mentor Corporation and American Medical Systems, Inc. dated September 13, 2004.

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Master License Agreement, between Mentor Corporation and SurModics, Inc. dated March 31, 1999, as amended June 8, 1999 and July 1, 1999.

License Agreement, between Boston Scientific Corporation and Mentor Medical Inc. and including Mentor Corporation dated February 24, 2000.

Supply and Distribution Agreement, between Mentor Corporation and Polymedco, Inc. and its subsidiary Bion Diagnostic Sciences Inc. dated February 16, 2001, as amended August 7, 2002.

Exclusive Distribution Agreement, between Mentor Medical Inc. and Tutogen Medical, Inc. (formerly Biodynamics International Inc.) dated January 1, 1998, as amended on July 15, 1998, November 1, 1998, June 25, 1999, October 25, 2001, June 24, 2004, April 30, 2005 and January 30, 2006.

Manufacturing and Supply Agreement, between Mentor Minnesota Inc. and Plasco, Inc. dated January 26, 2001.

Settlement Agreement, between Mentor Corporation and McKesson Corporation, dated May 22, 1991.

Exclusive Distribution Agreement between Mentor Corporation and Vitalife, Inc., dated March 17, 2004.

Stock Purchase Agreement between MBI Holding, Inc., Mills Biopharmaceuticals, Inc., and Mentor Corporation dated December 31, 2001.

Agreement between Unomedical and Mentor Corporation, dated November 5, 2003, as amended February 10, 2004.

Exclusive Distribution Agreement between Mentor Corporation and Althea Medical, dated July 18, 2005.

Exclusive Distribution Agreement between Mentor Corporation and Apex International, dated December 1, 2004.

Exclusive Distribution Agreement between Mentor Corporation and ConvaTec, dated January 15, 2003, as amended May 11, 2004.

Exclusive Distribution Agreement between Mentor Corporation and DongBang Healthcare Products Co., dated July 27, 1994.

Exclusive Distribution Agreement between Mentor Corporation and Ecuasurgical SA, dated September 12, 2004.

Exclusive Distribution Agreement between Mentor Corporation and Endotherapeutics Pty Ltd., dated April 29, 2005.

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Exclusive Distribution Agreement between Mentor Corporation and H. Strattner & Cia Ltda, dated April 25, 2002, as amended July 24, 2003 and August 27, 2003.

Exclusive Distribution Agreement between Mentor Medical Inc. and Medicina Y Technologia S.A. De C.V., dated September 10, 2004.

Exclusive Distribution Agreement between Mentor Corporation and North West Co., LTD, dated November 11, 2004.

Exclusive Distribution Agreement between Mentor Corporation and Promex S.A, dated May 11, 2004.

Exclusive Distribution Agreement between Mentor Corporation and GCP Med, July 26, 2004.

Non-Exclusive Distribution Agreement between Mentor Corporation and Kirudan A/S, April 22, 1999.

Investigator Agreement between Mentor Corporation and Ajay Nehra M.D., dated January 23, 1997.

Investigator Agreement between Mentor Corporation and Rafael Mora M.D. dated May 25, 2005.

Investigator Agreement between Mentor Corporation and David McLeod M.D. dated September 2, 2003.

Investigator Agreement between Mentor Corporation and Allen Morey M.D. dated February 5, 2004.

Patent Cross License Agreement between 2000 Injectx and Prosurg, Inc. dated August 2, 1999 as amended September 2, 2003.

The following agreement provides that either party may terminate the agreement if the other party’s ownership or effective control changes:

Private Label Supply And Distribution Agreement between Sims Portex Limited and Rochester Medical Inc, effective March 1, 1999.

Third Party Licenses Related to the Business that Will Not Be Assigned:

Supply Agreement between Mentor Corporation and Rochester Medical Corporation, dated October 1, 2001.

Male External Catheter License, Sales and Distribution Agreement, between Mentor Corporation and Rochester Medical Corporation dated April 24, 1991.

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Schedule 1.173

Transferred Contracts

Exclusive Distribution Agreement between Mentor Corporation and Althea Medical, dated July 18, 2005.

Exclusive Distribution Agreement between Mentor Corporation and Apex International, dated December 2, 2004.

Exclusive Distribution Agreement between Mentor Medical Inc. and REM Industria e Comcerio Ltda, dated August 14, 2000, as amended January 13, 2003 and December 3, 2003.

Exclusive Distribution Agreement between Mentor Medical Inc., and Sayco Ply. Ltd., dated April 16, 2002.

Exclusive Distribution Agreement between Mentor Medical Inc. and Promedco LTDA, dated May 10, 2001.

Patent Assignment Agreement between Emmanuel Delorme, Georges Eglin, Jean-Marc Bernaud and ABISS and Mentor Corporation dated October 6, 2005.

Exclusive Supply Agreement between Mentor Corporation and ABISS dated October 12, 2005.

Exclusive Distribution Agreement between Mentor Corporation and Convatec, dated January 15, 2003, as amended May 11, 2004.

Exclusive Distribution Agreement between Mentor Corporation and DongBang Healthcare Products Co., dated July 27, 1994.

Exclusive Distribution Agreement between Mentor Corporation and Ecuasurgical SA, dated September 12, 2004.

Exclusive Distribution Agreement between Mentor Corporation and Endotherapeutics Pty Ltd., dated April 29, 2005.

Exclusive Distribution Agreement between Mentor Corporation and H. Strattner & Cia Ltda, dated April 25, 2002, as amended July 24, 2003 and August 27, 2003.

Exclusive Distribution Agreement between Mentor Corporation and North West Co., LTD, dated November 11, 2004.

Exclusive Distribution Agreement between Mentor Corporation and Promex S.A, dated May 11, 2004.

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Exclusive Marketing and Distribution Agreement between Advanced Urological Developments and Mentor Corporation, dated June 26, 2002.

Brachytherapy Supply Agreement between Mentor Corporation and Roger Williams Medical Center, dated January 9, 2003.

Standard Supply and Purchase Agreement Terms and Conditions between Mentor Corporation and St. Joseph Hospital of Orange, dated May 1, 2003, and PO dated April 30, 2005.

Brachytherapy Supply Agreement between Mentor Corporation and Urology Center dated November 20, 2003.

Agreement between Unomedical Inc. and Mentor Corporation, dated November 5, 2003, as amended February 10, 2004.

Sales Agreement between Texas Health Resources and Mentor Corporation dated March 14, 2004.

Corporate Alliance Program between Texas Health Resources and Mentor Corporation dated March 14, 2004.

Addendum to Sales Agreement and Partnering Program between Texas Health Resources and Mentor Corporation dated February 26, 2004.

Exclusive Distribution Agreement between Mentor Corporation and GCP Med, August 4, 2004.

Non-Exclusive Distribution Agreement between Mentor Corporation and Kirudan A/S, April 22, 1999.

Non-Exclusive Distribution Agreement between Mentor Corporation and Einat Medical Agencies, Ltd., May 7, 2002.

Non-Exclusive Distribution Agreement between Mentor Corporation and Ebewe Arzneitmittel Ges.m.b.H, November 28, 2000.

Exclusive Distribution Agreement, between Mentor Medical Inc. and Tutogen Medical, Inc. (formerly Biodynamics International Inc.) dated January 1, 1998, as amended on July 15, 1998, November 1, 1998, June 25, 1999, October 9, 2001, June 1, 2004, April 30, 2005 and January 30, 2006.

Corporate Agreement CH-RA-002 between Mentor Corporation and Catholic Healthcare West dated May 1, 2004.

Exclusive Distribution Agreement between Mentor Corporation and KBB Ozel Saglik Hizmeheri Ve Tibbi Danismanlik Tic. Ltd. Sti., dated April 22, 2004.

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Exclusive Distribution Agreement between Mentor Corporation and Fannin Healthcare, Ltd dated November 30, 2004.

Exclusive Distribution Agreement between Mentor Corporation and ELVIM Limited dated September 27, 2004.

Exclusive Distribution Agreement between Mentor Corporation and Sayco Ply Ltd dated April 16, 2002.

Clinical Study Agreement between Mentor Corporation and Health Research Association and John Klutke dated December 1, 2004.

Consorta, Inc. Group Purchasing Agreement for the Exclusive Use of Catholic Health Initiative between Consorta and Mentor Corporation, effective October 1, 2005.

Purchase and Sale Agreement, between Mentor Corporation and South Bay Medical, LLC, dated December 1, 2000, as amended March 22, 2006.

Master License Agreement, between Mentor Corporation and SurModics, Inc. executed March 31, 1999, as amended June 8, 1999 and July 1, 1999.

Supply and Distribution Agreement, between Mentor Corporation and Polymedco, Inc. and its subsidiary Bion Diagnostic Sciences Inc. dated February 16, 2001, as amended August 7, 2002.

Manufacturing and Supply Agreement, between Mentor Minnesota Inc. and Plasco, Inc. dated January 26, 2001.

Patent License Agreement, between Mentor Corporation and Boston Scientific Corporation dated May 7, 2004.

Settlement Agreement and Non-Exclusive Cross-License Agreement between Mentor Corporation and American Medical Systems, Inc. dated September 13, 2004.

Exclusive Supply Agreement between Mentor Corporation, including its wholly owned subsidiary, Porges SAS, and Analytical Biosurgical Solutions dated January 31, 2005.

Supply Agreement between Mentor Corporation and Analytical Biosurgical Solutions dated August 14, 2003.

Letter of Intent, Manufacturing and Supply Agreement between Mentor Corporation, Porges SAS, and Analytical Biosurgical Solutions dated May 5, 2004.

Amended and Restated Supply and Distribution Agreement, between Mentor Corporation and Amsino International, Inc. dated September 21, 2005.

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Supply and Distribution Agreement between Mentor Corporation and Best Medical International, Inc. dated January 8, 2003, amended August 18, 2003, December 15, 2004, January 8, 2005 and January 8, 2006.

Patent License Agreement between Prosurg, Inc., A. Desai and AMI, LLC dated September 2, 2003, and amended effective September 2, 2003.

Research and Development Agreement among Mentor Corporation, Mentor Research and Development Corporation and Mentor Development Limited Partnership, dated September 8, 1981.

Assignment by Mentor Research and Development Corporation to Mentor Development Partnership, dated September 8, 1981.

Agreement between Mentor Corporation and Mentor Research and Development Corporation, dated September 25, 1981.

Sale and Purchase of All Issued Shares of Havas Medical B.V., dated March 21, 1997.

Premier Purchasing Partners, L.P. Group Purchasing Agreement-Med/Surg Contract # PP-OR-078, dated June 1, 2003, as amended December 1, 2003, November 15, 2004, February 1, 2005, and February 1, 2006.

Premier Purchasing Partners, L.P. Group Purchasing Agreement-Med/Surg Contract # PP-NS-085, dated July 7, 2003 as amended September 1, 2003 and February 1, 2004.

Premier Purchasing Partners, L.P. Group Purchasing Agreement-Med/Surg Contract # PP-NS-087, dated July 1, 2003.

Patent Assignment Agreement between Mentor Corporation and Trustees of the Advanced Surgical Intervention Liquidating Trust, dated October 1, 1996.

Assignment Agreement between Mentor Corporation and American Hospital Supply Corporation dated March 30, 1984.

Product Line Purchase and Sale Agreement between Mentor Corporation and Boston Pacific Medical Devices, dated June 1, 1996.

Agreement for Purchase and Sale of Lubricating Gel Formula between Mentor Urology Inc., and Pakentech Inc., dated August 26, 1994.

Agreement and Plan of Reorganization by Mentor Corporation, AMI, LLC and Ashvin Desai, dated June 20, 2003.

Consulting Agreement between Mentor Corporation and Ashvin Desai, dated June 30, 2003.

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Distribution Rights Purchase Agreement between Mentor Corporation and Ashvin Desai, dated June 30, 2003.

Asset Purchase and Sale Agremeent between Mentor Corporation and Prosurg, Inc., dated October 1, 2001.

Supply and Purchase Agreement between Mentor Corporation and Prosurg Inc. executed November 30, 2001, as amended January 1, 2003.

Consulting Agreement between Mentor Corporation and Prosurg Inc., dated November 30, 2001.

Materials Transfer Agreement between Promethean Surgical Devices, LLC and Mentor Corporation, executed as of June 16, 2003.

Manufacturing Agreement between Mentor Corporation and Kent Elastomer Products, Inc. dated June 1, 2002.

Non-exclusive Distribution Agreement between Mentor Corporation and Sphinx International dated February 19, 2002 as amended dated June 25, 2002.

Radiation Services Agreement between Radiation Sterlizers, Inc. and Mentor Corporation dated September 18, 1991.

Medi-Cal Medical Supply Maximum Acquisition Cost Agreement between State of California (Department of Health Services) and Mentor Corporation, dated July 7, 2005.

Purchase Agreement by and among Sanofi-Synthelabo and Synthelabo Biomedical and Mentor Corporation, dated February 8, 2001.

Settlement Agreement and Limited Release between Mentor Corporation and International Medical Specialties, dated November 14, 1997.

Product Sale and Indemnification Agreement between Mentor Corporation and Quadion Corporation, dated August 18, 2005.

Assignment of Copyright Agreement between Mentor Corporation and Joanne Field, dated April 30, 1992.

Assignment of Copyright Agreement between Mentor Corporation and Joanne Field, dated June, 1997.

Saint Louis University Model Clinical Research Agreement between Saint Louis University and Mentor Corporation, dated June 4, 1999.

Exclusive Distribution Agreement between Mentor Corporation and Vitalife, Inc., dated March 17, 2004.

Covenant against Competition Given to Mentor Corporation and Selene Corporation by Ashvin Desai, dated July 23, 2003.

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Processing Agreement Between Steris, Inc. and Mentor Corporation, dated March 1, 2003.

Exclusive Processing Agreement Between Sterigenics, Inc. and Mentor Corporation, dated December 22, 2005.

Non-Exclusive Distribution Agreement between Mentor Corporation and Pharma 2000 PTE Ltd., dated September 7, 2004, amended May 19, 2005.

Agreement for Stress and Incontinence Products between Broadlane, Inc. and Mentor Corporation dated August 1, 2004.

Agreement for Brachytherapy Seeds and Related Products between Broadlane, Inc. and Mentor Corporation dated August 1, 2005, and amended September 1, 2005.

Letter of Credit in Favor of Argonaut Insurance Company, written by Bank of the West dated July 1, 2003.

Renewal Letter of Credit in Favor of Argonaut Insurance Company, written by Bank of the West dated May 28, 2005.

Investigator Agreement with Mentor Corporation and Gr. Steinhardt dated August 18, 1998.

Binding Letter of Intent regarding Exclusive License of International Patents to Mentor Corporation, between Mentor Corporation, Mr. Emmanuel Delorme, Mr. Georges Eglin, Mr. Jean-Marc Beraud, and Analytic Biosurgical Solution - ABISS, dated October 12, 2005.

Agreement, between Mentor Corporation, Uronova Corporation, and Mr. Patrice Suslian, dated April 4, 2003.

License and Consulting Agreement, between Mentor Corporation and Prolapse, Inc., dated October 3, 2005.

Patent Assignment between Mentor Corporation and Analytic Biosurgical Solution - ABISS, dated December 7, 2005.

Purchase Agreement between Mentor Corporation and Cooperative Services of Florida, Inc., dated January 1, 2005.

Pricing Agreement with Mentor Corporation and Adventist Health System dated February 1, 2005.

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Best Value Distribution Agreement between Mentor Corporation and Allegiance Healthcare Corporation dated July 1, 2001.

Purchase Agreement Number 729 between Healthtrust Purchasing Group L.P. and Mentor Corporation dated December 1, 2002 and amended February 1, 2003, November 1, 2004, June 24, 2005, November 30, 2005, and February 3, 2006.

Mentor Alliance Program between Mentor Corporation and Invacare Supply Group, from September 3, 2005-September 1, 2006.

Consulting and Specialist Agreements between Mentor Corporation and the following parties:

Gill Anderson, ending January 1, 2006.

J. Brady dated July 1, 2005.

J. Bass as amended on December 1, 2004.

J. Brandeis dated March 16, 2005.

M.B. Brooks dated August 20, 1998, amended August 20, 2001.

E. Dakil dated January 1, 2005.

C.B. Dhabuwala dated April 1, 2000.

D. Elliot amended April 1, 2005.

T. Fogarty dated March 28, 2005.

R. Fritzsch dated March 31, 2005.

F. Garcini dated January 1, 2005.

E Gheiler dated August 1, 2003.

G. Ghoniem dated July 1, 2000 amended.

S. Shawn Gholami dated June 22, 2005.

C.W. Graham dated January 1, 2004.

T. Giudice dated November 22, 2004.

P. Hatcher dated April 29, 2005.

R.L. Hatchett dated December 1, 1998.

C. William Hinnant Jr dated July 24, 2002 as amended July 24, 2004.

B. Kyburz dated October 1, 2003.

R. Hundley dated March 8, 2005.

J. Johnson dated June 22, 2005.

R. Vaz Juliano dated January 24, 2005.

M. Kennelly dated June 22, 2005.

M. Khandheria dated April 13, 2005.

G. Kirsh dated November 14, 2001.

Melogranaa dated February 1, 2004.

D. Hawkins dated February 15, 2005.

B.J. Roberts dated January 1, 2005.

F. Sadeghi dated May 6, 2005 and amended March 14, 2006.

D. Schewitz dated March 28, 2005.

A. Shannon dated April 21, 2005.

A. Siegel dated September 1, 2003.

E. Stanford dated February 16, 2005.

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B. Stone dated April 14, 2005.

P.S. Terry dated June 8, 2005.

M. Tran dated April 18, 2005.

R. Valenzuela as amended June 13, 2004.

M. Villanueva dated May 4, 2004.

S. Winter dated May 1, 2005.

S. Aboseif dated April 25, 2005.

Advanced Gyn of Central Fl. dated February 1, 2005.

C. Anderson dated January 1, 2004.

Arp Design & Engineering dated January 1, 2001, expires February 28, 2006.

C. Asher-Walsh dated January 1, 2005, expires February 7, 2006.

M. Autry dated March 18, 2005.

M Autry dated April 29, 2005.

A. Babaoff dated August 23, 2005.

J. Banno dated July 7, 2005.

W. Belsom dated October 7, 2005.

K. Bhatta dated May 31, 2005.

J. Blanco dated January 1, 2005.

M. Blasser dated April 1, 2005.

Ackerman dated November 1, 2005.

Schow dated November 10, 2005.

M. Dumont dated November 16, 2005.

Banno dated July 7, 2005.

Khan dated October 3, 2005.

Zisow dated October 25, 2005.

James dated October 25, 2005.

Litvak dated October 25, 2005.

Guzman dated October 14, 2005.

Land dated October 13, 2005.

R. Leff as amended October 3, 2005.

Belson dated October 3, 2005.

B. Dodge as amended March 1, 2005.

I. Goldstein as amended September 1, 2005.

C. Williams as amended March 6, 2005.

P. Kardjian as amended September 1, 2005.

E. Wespes as amended April 1, 2005.

Wellness Partners LLC dated September 1, 2005.

A. Cassidenti dated January 19, 2005.

A. Chernoff, not dated.

D. Curhan dated September 9, 1999.

L. Hakim M.D. dated July 18, 1999.

B. Stone dated November 10, 2001.

B. Casey dated June 5, 1998.

B. Cockhill dated June 6, 1997.

J. Collins dated February 24, 2004.

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L. Davis dated February 28, 2005.

A Desai dated February 9, 2004.

M. Findley dated August 2, 2004.

T. Flood dated September 7, 1999.

M. Freier dated July 27, 2005.

L. Groh dated October 30, 1998.

K. Hampton dated November 26, 1997.

L. Hunziker dated March 18, 2002.

J. Jiskra dated February 9, 2004.

L. Jacoy dated February 25, 1998.

J. Johnson dated June 3, 2005.

B. Kittrell dated March 8, 2004.

R. Kleisner dated February 9, 2004.

D. Lenigan dated July 25, 2003.

J. Leonard dated October 18, 1998.

J. Carlos Lopez dated June 28, 2000.

G. Lynch dated August 10, 2004.

D. Maldonado dated December 8, 2004.

J. Marquardt dated December 16, 2003.

P. Martindale dated August 8, 2002.

Paara dated November 3, 2002.

B. Parker dated May 23, 1996.

K. Purcell dated April 27, 2004.

R. Regan dated September 13, 2004.

J. Rethaber dated April 7, 2004.

B. Revanna dated November 12, 1997.

P. Rick dated April 1, 1999.

A. Russell dated November 12, 1996.

D. Russel dated May 19, 1998.

M. Sasko dated March 8, 2004.

Shumaker Marketing dated July 25, 2003.

K. Simpson dated July 25, 2003.

C. Trammell dated February 15, 2004.

G. Wilkes dated August 2, 2005.

B. Williams dated January 13, 1997.

M. Williams dated June 14, 2002.

A. Yergins dated November 3, 2002.

R.O. Wolkind Medical Services dated December 21, 1997.

C. Alexander dated June 17, 2004.

M. Alvarez dated June 15, 2005.

N. Anderson dated March 10, 2004.

Freier dated July 27, 2005.

Hernandez dated October 25, 2005.

Maurer dated October 13, 2005.

Griffin dated October 17, 2005.

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C.B. Dhabuwala dated June 1, 1993.

Shelly King.

R. Fein dated July 28, 1986.

Kemberling dated September 19, 2005.

Ignacio Ferras dated November 1, 2005.

Thomas Brian Willard dated December 22, 2005.

John Rizzo dated December 13, 2005.

Ajay Singla dated December 13, 2005.

Steve Winter as amended October 31, 2005.

Chris Steidle dated July 1, 2004.

Sandy Springs as amended April 1, 2005.

Chris Love dated April 17, 2005.

Guthman dated January 19, 2006.

Henry dated January 19, 2006.

Trulock dated January 19, 2006.

J. Ferras dated November 1, 2005.

F. Eid as amended January 30, 2006.

Andros dated February 10, 2006.

Haas dated February 10, 2006.

S. Juma as amended April 1, 2005.

Wilson Price dated January 11, 2006.

C. Secrest as amended October 1, 2005.

J. Mulcahy as amended April 1, 2005.

G. Brito as amended March 14, 2006.

M. Daller as amended August 1, 2005.

S. Smithson dated March 14, 2006.

R. Miklos dated March 17, 2006.

S. Morganstern dated March 17, 2006.

Doctor Agreements between Mentor Corporation and the following parties:

Cassidenti & Associates dated March 17, 2005.

Sanford as amended February 2, 2006.

Steidle dated May 17, 2005.

Women's Cancer Center dated January 27, 2005.

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Investigator Agreements between Mentor Corporation and the following parties:

J. Alarcon dated May 5, 2005.

Mora dated May 25, 2005.

Koyle dated November 1, 2003.

Kaufman dated August 7, 2003.

Hatch dated October 17, 2003 and July 6, 1998.

Loyola University dated April 21, 2005.

McLeod dated September 2, 2003.

Jordan dated October 13, 2003.

Gilbert dated June 27, 2005.

Brady dated September 8, 2005.

Brown dated September 2, 2003.

Seaman dated August 21, 2003.

Dineen dated July 29, 1998.

Goldstone dated February 18, 1999.

Gonzales dated July 6, 1998.

Kaufman dated June 22, 1998.

Jordan dated September 23, 1998.

Costabile dated August 17, 1998.

O'Leary dated August 24, 1998.

Scherz dated October 10, 1998.

Palomar dated July 16, 1998.

Canning dated July 1, 1998.

Munarriz dated April 20, 2004.

Morgantalor dated September 20, 2003.

Lewis dated July 3, 2003.

Mulhall dated October 13, 2003.

Fuselier dated August 2, 2004.

Hellstrom dated August 31, 2004.

O’Reilly dated May 28, 2003.

Perez-Marrero dated May 14, 2004.

Hirsch dated November 17, 2003.

Donatucci dated December 10, 2003.

Morrey dated February 18, 2004.

Carson dated October 22, 2004.

F. Borges dated June 3, 1996.

C.B. Dhabuwala dated June 16, 1996.

J. Kaufman dated June 4, 1996.

R. Pelfrey dated September 5, 1996.

A. Nehra dated December 30, 1996.

J. Delk dated April 1, 1997.

S. Wilson dated April 1, 1997.

B. Garber dated January 21, 1997.

J.Mulcahy dated June 3, 1996.

J. Kaufman dated June 4, 1996.

Clinical Trial Agreements between Mentor Corporation and the following parties:

Rhode Island Hospital dated January 22, 2004.

Kogan dated August 5, 1998.

Koyle dated August 21, 1998.

Kramer dated August 11, 1998.

Ortenberg dated November 2, 1998.

Retik dated August 11, 1998.

Sigman dated August 11, 1998.

Tennenbaum dated December 8, 1998.

Turek dated April 4, 1999.

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Institution Agreement between Mentor Corporation, NY Medical College, and Kogan dated April 15, 2004.

Institution Agreement between Mentor Corporation and Brady dated April 21, 2005.

Institution Agreement between Mentor Corporation and Morgantalor 9-20-03.

Saint Louis University Model Clinical Research Agreement between Saint Louis University and Mentor Corporation, dated October 29, 1998.

Alliance program incentive awards agreement between Mentor Corporation and Invacare.

Alliance program incentive awards agreements between Mentor Corporation and Rochester Drug Company dated January 1, 2006.

Alliance program incentive awards agreement between Mentor Corporation and Mercy Surgical dated October 24, 2005.

Alliance program incentive awards agreement between Mentor Corporation and Uromed Inc. dated October 31, 2005.

Alliance program incentive awards agreement between Mentor Corporation and Mckesson Drug dated March 1, 2005.

Alliance program incentive awards agreement between Mentor Corporation and Edgepark dated August 23, 2005.

Alliance program incentive awards agreement between Mentor Corporation and Mercy Surgical dated October 24, 2005.

Alliance program incentive awards agreement between Mentor Corporation and Zarman dated January 7, 2006.

Alliance program incentive awards agreement between Mentor Corporation and DS Medical dated February 1, 2006.

Isoloader Demo Agreement between Mentor Corporation and Aiken Regional Medical Centers dated October 1, 2004.

Isoloader Demo Agreement between Mentor Corporation and Wentworth-Douglas Hospital dated October 27, 2005.

Isoloader Demo Agreement between Mentor Corporation and the University of Wisconsin dated February 28, 2005.

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Pricing Agreement between Mentor Corporation and Adventist Health System dated February 1, 2005.

Pricing Agreement between Mentor Corporation and Healthsouth dated March 24, 2005 and amended June 22, 2005.

Purchase Agreement between Mentor Corporation and Cooperative Services of Florida Inc., dated January 1, 2005.

Research Agreement between Mika Raitanen and Mentor Corporation dated October 3, 2005.

Group Purchase Agreement between Amerinet Inc and Mentor Corporation dated September 23, 2002, amended September 12, 2005, and October 1, 2005.

Options Agreement Extension with Amerinet Inc. dated September 12, 2005.

Education Videos Agreement between Mentor Corporation and Jeffery Markowitz Productions Inc., dated June 3, 2005.

Vendor Agreement between Carolina Shared Services LLC and Mentor Corporation dated November 1, 2005.

Indemnification Agreement between Mentor Corporation and Chesapeake Research dated October 1, 1996.

Divestiture and Indemnification Agreement between Mentor Corporation and M.J. Daugherty dated September 25, 1997.

Agreement To Indemnify between Mentor Corporation and Encore Inc. dated July 25, 1991.

Indemnification Agreement between Mentor Corporation and Saad Juma, M.D. dated February 14, 1996.

Distribution Agreement between Mentor Medical Inc. and Medicina Y Technologia S.A. De C.V.

Exclusive Distribution Agreement between Mentor Medical Inc. and Dongbang Healthcare Products Co., Ltd., October 5, 2000, as amended December 3, 2003

Indemnification Agreement With Memorial Hospital System Dated June 3, 1996.

Indemnification Agreement With Memorial Hospital System Dated April 29, 1997.

Indemnification and Clinical Study Agreement Between Mentor Corporation and Montefiore Medical Center dated March 6, 1996.

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Settlement and License between Boston Scientific Corporation and Mentor Medical Inc dated February 24, 2000.

Settlement Agreement between Mentor Corporation and Promedco LTDA dated April 2, 2004.

Endorsement and Marketing Agreement between Mentor Corporation and Top Entertainment Products, Inc dated August 1, 2005.

Product Integration Agreement between Mentor Corporation and Galan Entertainment effective July 1, 2005.

Supply Agreement Between Kendall Healthcare Products And Mentor Corporation dated September 6, 1996.

Group Purchase Agreement number MS00177 between Medassets HSCA and Mentor Corporation dated August 14, 2002.

Vendor Agreement number MS00176 between Mentor Corporation and MedAssets HSCA dated August 14, 2002, as amended.

Agreement for Penile Prosthesis Products between KP Select, Inc, And Mentor Corporation Dated December 1, 2004.

Settlement Agreement and Limited Release between Mentor Corporation, Mentor Medical Systems France, SA, Mentor Benelux B.V., Mentor Deutschland GmbH and IMS International Medical Specialties S.A., dated November 14, 1997.

Stock Purchase Agreement between MBI Holdings, Mills Biopharmaceuticals, Inc. and Mentor Corporation dated December 31, 2001.

Covenant Against Competition between Mentor Corporation, Selene Corporation and Ashvin Desai dated June 20, 2003.

Agreement of Merger between AMI LLC, Selene Corporation, and joined by Mentor Corporation dated June 30, 2003.

Logistics Management Agreement between Mentor Corporation and CH Robinson Worldwide, Inc. dated April 2005.

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Independent Sale Representative Agreement Between Mentor Corporation and Park City Medical Products LLC dated April 29, 2005.

Independent Sale Representative Agreement between Mentor Corporation and George Hoedeman dated May 18, 2005.

Independent Sale Representative Agreement between Mentor Corporation and Southern Diagnostic and Treatment dated April 1, 2001.

Independent Sale Representative Agreement between Mentor Corporation and Source Tech Medical LLC dated February 23, 2002, as amended October 23, 2002.

Independent Sales Representative Agreement between Mentor Corporation and D. Fuller dated January 24, 1996.

Vending Agreement between Mentor Urology Inc., and Vendmark Inc. dated March 23, 1994.

Services Agreement between Mentor Corporation and the Urology Center of Georgia, LLC dated January 12, 2004, as amended on January 14, 2005.

Services Agreement between Mentor Corporation and Urological Ambulatory Surgery Center, Inc. dated March 17, 2004.

Services Agreement between Mentor Corporation and Surgery Center of Ocala, LLC dated April 1, 2004.

Services Agreement between Mentor Corporation and Jackson Radiological Physics, Inc. dated May 25, 2005.

Services Agreement between Mentor Corporation and Huff, Ferras and Associates Inc. dated January 1, 2005.

Services Agreement between Mentor Corporation and Roderick C. Givens dated June 1, 2003.

Services Agreement between Mentor Corporation and Front Range Radiation Oncology dated November 15, 2001.

Services Agreement between Mentor Corporation and Citrus Urology Center Inc. dated April 1, 2004.

Services Agreement between Mentor Corporation and Ariston Radiology Associates, LLC dated June 1, 2003.

Services Agreement between Mentor MBI and Underwriters Laboratories Inc. dated April 26, 2005.

Services Agreement between Mentor Corporation and South Texas Urology & Urologic Oncology, PA dated January 12, 2004, as amended January 12, 2005 and July 1, 2005.

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Group Purchasing Agreement between Mentor Corporation and Northwood Plus Inc. dated August 2, 2003.

Brachytherapy Seed Loading Agreement between MedTech Diagnostics and Mentor Corporation dated November 7, 2001.

Professional Consulting and Engineering Services Agreement between Mentor Corporation and Ogden Environmental and Energy Services Co., Inc. dated February 12, 1998.

Vendor Acknowledgement between Mentor Corporation and Americorp Financial Inc. dated March 4, 2003.

Product Sale and Indemnification Agreement between Mentor Corporation and Quadion Corporation dated August 18, 2005.

Indemnification Agreement between Mentor Corporation and UroTherapies Inc. dated December 7, 1998.

Indemnification Agreement between Surgicare of La Veta Ltd. And Mentor Corporation dated July 20, 2005.

Group Purchasing Agreement between Amerinet, Inc. and Mentor Corporation on behalf of Shriner’s Hospitals dated September 23, 2002.

Mentor Corporate Alliance Program Agreement and Sales Agreement with Texas Health Resources, dated March 14, 2004, addendum dated February 26, 2004.

Mentor Health Care Alliance Program with Zarman Medical dated January 7, 2005.

Group Purchasing Agreement between Mentor Corporation and International Physicians Networks, LLC d/b/a, and International Urology Network dated as of 1/9/05.

Binding letter of intent to enter into a Manufacturing and Supply Agreement between Mentor Corporation and Abiss Medical dated May 5, 2004.

Exclusive Supply Agreement between Mentor Corporation, Analytical Biosurgical Solutions, and Porges SAS dated January 31, 2005.

Exclusive Supply Agreement between Mentor Corporation and Analytical Biosurgical Solutions dated August 14, 2003.

Patent Assignment Agreement between Mentor Corporation and the Advanced Surgical Invention Liquidating Trust dated October 1, 1996.

License Agreement between Boston Scientific Corporation and Mentor Medical Inc, and including Mentor Corporation, dated February 24, 2000.

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Non-exclusive Distribution Agreement between Mentor Medical Inc and Laboratorios India, S.A. dated June 22, 2000 (Laboratorios may terminate for Change of Control.)

Acquisition and Transition Agreement between Mentor Corporation, Mentor Medical Systems France SA and IMS International Medical Supplies S.A. dated November 30, 1995.

Acquisition and Transition Agreement between Mentor Corporation, Mentor Benelux B.V. and IMS International Medical Supplies S.A. dated July 7, 1995.

Exclusive Distribution Agreement between Mentor Benelux B.V. and Laprolan BV dated June 1, 2004.

Exclusive Distribution Agreement between Mentor Benelux B.V. and Gribi A.G. Belp dated March 31, 2005.

Asset Purchase and Sale Agreement between Mentor Corporation and Prosurg Inc. dated October 1, 2001.

Clinical Study and Research Agreement between Cleveland Clinic Florida and Mentor Corporation dated December 13, 2005.

Clinical Study Agreement between Mentor Corporation and Washington University dated Sepember 22, 2004.

Brachytherapy Supply Agreement between Mentor Corporation and Med-Smart dated January 17, 2005.

Sales Agreement between Mentor Corporation and Applied Health Systems amended January 19. 2006.

Custom Device Agreement between C. Olsson.pdf and Mentor Urology Inc. dated December 18, 1995.

Confidentiality agreement between Saad Juma and Mentor Urology Inc. dated April 13, 1994.

Mutual Confidentiality Agreement between Millennium Biomedical and Mentor Minnesota Inc, dated July 28, 1999.

Indemnification Agreement between CNC Machining and Mentor Urology Inc, dated April 30, 1994.

Telemarketing Services Agreement between ERS Inc. and Mentor Urology Inc. dated April 22, 1997.

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Repair Facilities Agreement between Biosound Inc. and Mentor Urology Inc. dated June 3, 1994.

Product Line Purchase and Sale Agreement between Boston Pacific Medical Devices, Inc., and Mentor Urology Corporation dated June 1, 1996.

Agreement for purchase and sale of Lubricating Gel Formula between Mentor Urology Inc. and Pakentech, Inc, dated August 26, 1994.

Supply and purchase agreement between Prosurg Inc. and Selene Corporation dated June 30, 2003.

P.O. / Invoice between MDS Nordion and Mills Biopharmaceauticals , Inc., dated July 14, 2005.

Supply and Purchase Agreement between Pro Surg, Inc. and Selene Corporation dated June 30, 2003.

Manufacturing and Supply Agreement, between Plasco, Inc. and Mentor Minnesota Inc., dated January 26, 2001.

Exclusive Marketing and Distribution Agreement between Bio-Vascular, Inc. and Mentor Urology Inc., dated June 6, 1996.

Sterilization Services Agreement between Quality Sterilization Services and Mentor Urology Inc., dated April 21, 2005.

License Agreement between Saad Juma M.D. and Mentor Urology Inc.

License Agreement between Robert Pelfrey M.D. and Mentor Urology Inc.

Pricing Program Agreement between Federal Express Corporation and Mentor Corporation, dated January 31, 2003.

Non-Exclusive Distribution Agreement between Mentor Corporation and Medicina Y Tecnologia, S.A. DE C.V. dated September 10, 2004.

Exclusive Distribution Agreement between Mentor Corporation and NuAngle Medical dated March 13, 2006.

Administrative Services Contract between Med/Surgical Information Services International and Mentor Corporation, dated December 1, 2003.

Mutual Confidentiality Agreement between Med/Surgical Information Services International and Mentor Corporation, dated December 1, 2003.

Testing and Certification Agreement between TUV America Inc. and Mentor Minnesota Inc., dated March 15, 2005.

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Mutual Non-Disclosure Agreement between TUV America Inc. and Mentor Minnesota Inc., not dated.

Settlement Agreement between Mentor Corporation and Armin Schorer dated July 18th, 2003.

Letter from Mentor Corporation to Intrason France S.A. dated January 20, 2003.

Consent Agreement with Transcoject GmBH, dated May 27, 2005.

Desai Asset Contribution Agreement between Ashvin Desai, Prosurg, Inc. and AMI, LLC dated May 10, 2003.

Supply Agreement between Adhe-Els and Porges, dated October 21, 2002.

Non-Exclusive Distribution Agreement between Mentor Corporation and Intersan S.A., undated.

Non-Exclusive Distribution Agreement between Mentor Corporation and Al Amin Medical Instruments, undated.

Non-Exclusive Distribution Agreement between Mentor Corporation and Maersk Medical, undated.

All Consignment Agreements relating to the Business, by and between Seller and various third parties, dated as of various dates.

Patent License Agreement between Prosurg, Inc. Ashvin Desai and Mentor Corporation and Selene Corporation dated March 21, 2006.

All rights that Seller may transfer to Buyer under that certain Letter Agreement dated September 9, 2003, adresssed to Seller, from Pro Surg, Inc., 2000 Injectx, Inc. and Ashvin Desai.

Utilization Authorization for Filing the ARIS Trademark in Canada between Analytical Biosurgical Solutions and Porges SAS January 21, 2005.

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Schedule 1.174

Transferred Copyrights

a. "Toobie's Catheter Story" registered on 10/31/91 and assigned Copyright Reg. No. 494230.

b. “For Teens Who Self-Catheterize" registered on 12/24/1996 and assigned Copyright Reg. No. 775752.

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Schedule 1.178

Transferred Internet Properties

Urology Domain Names

Straighttalkabouted.Com

5minutebladdercancertest.Com

Bladdercancerdetection.Com

Fastbladdercancertest.Com

Quickbladdercancertest.Com

Testiculardevices.Com

Testicularimplantinfo.Com

Freedomcath.Com

Labombita.Com

Labombita.Net

Labombita.Org

Lasbombitas.Com

Lasbombitas.Net

Lasbombitas.Org

Bombita.Net

Bombita.Org

Bombito.Com

Bombito.Net

Bombito.Org

Disfunctionerectil.Com

Disfunctionerectil.Net

Disfunctionerectil.Org

Straighttalkabouted.Com

Straighttalkabouted.Org

Straighttalkabouted.Net

Straighttalkphilly.Com

Straighttalkphilly.Org

Straighttalkphilly.Net

Isoloader.Net

Mbidirect.Com

Prescription-connection.co.uk/net/uk.com/uk.net

Prescriptionconnection.co.uk/uk.com/uk.net

Prescription-connection.co.uk/net/uk.com/uk.net

The-Prescription-connection.co.uk/com/net/uk.com/uk.net

ThePrescriptionconnection.co.uk/uk.com/uk.net

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Porges.com

Porges.fr

Aris-sui-register.com

Porges-prolapse-register.com

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Schedule 1.181(a)

Transferred Marks

Mentor Urology Worldwide Trademark Registrations (Porges listed separately)

Trademark Reg. Number Country Registration Date Owner

ACTIVE CATH	1,544,297	US	June 20, 1989	Mentor Corporation
ACU-FORM	1,656,728	US	September 10, 1991	Mentor Corporation
ACU-FORM	2,018,614	Spain	May 20, 1997	Mentor Corporation
ALPHA I	1,614,748	US	September 25, 1990	Mentor Corporation
ALPHA I	2,408,946	CTM-Community Trademark	September 8, 2003	Mentor Corporation
ALPHA I PROTESIS/Mentor LOGO (BLUE)	2,147,848	Spain	September 21, 1998	Mentor Corporation
ALPHA I PROTESIS	2,026,930	Spain	April 14, 2000	Mentor Corporation
ALPINE	2,529,235	US	January 15, 2002	Mentor Corporation
ARIS	1053965	Australia	September 5, 2005	Mentor Corporation
ARIS	892572	Mexico	July 27, 2005	Mentor Corporation
ARIS	534,910	Switzerland	June 23, 2005	Mentor Corporation
BIOFLEX	1,539,182	US	May 16, 1989	Mentor Corporation
CADENZA	2090895	Germany		Mentor Medical Limited
CADENZA	160226	Ireland	March 14, 1994	Mentor Medical Limited
CADENZA	1564189	United Kingdom	March 17, 1995	Mentor Medical Limited
CHIRON	86086	Ireland	September 5, 1974	Mentor Medical Limited
CHIRON	317,158	Portugal	April 5, 1999	Mentor Medical Limited
CHIRON	781476	United Kingdom	September 4, 1958	Mentor Medical Limited
CINCH	523,563	CTM-Community Trademark	January 26, 1999	Mentor Corporation
CINCH	TMA526,892	Canada	April 20, 2000	Mentor Corporation
CLEAR ADVANTAGE	1,742,236	US	December 22, 1992	Mentor Corporation
CLEAR ADVANTAGE	511,359	Benelux	March 17, 1992	Mentor Corporation
CLEAR ADVANTAGE	92,411,112	France	March 19, 1992	Mentor Corporation
CLEAR ADVANTAGE	B574,549	Australia	March 16, 1992	Mentor Corporation
CLEAR ADVANTAGE	TMA426,160	Canada	April 15, 1994	Mentor Corporation
COMFORT MATE	1,705,807	US	August 4, 1992	Mentor Corporation
CYSTO-CARE	945,562	Australia	October 28, 2003	Mentor Corporation
CYSTO-CARE	1153723	Germany		Mentor Medical Limited

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Trademark Reg. Number Country Registration Date Owner

CYSTO-CARE	12666644	United Kingdom	May 8, 1986	Mentor Medical Limited
CYSTO-CARE	2,942,548	US	April 19, 2005	Mentor Corporation
CYSTO-CARE	3,078,938	CTM-Community Trademark	7/29/2015	Mentor Corporation
CYSTO-CARE	660,787	Canada	March 15, 2006	Mentor Corporation
DERMA-GARD	1,207,224	United Kingdom	November 16, 1983	Mentor Medical Limited
DERMA-GUARD	752,812	US	July 16, 1963	Mentor Corporation
DIGNITI-CARE	1100019	Germany	December 5, 1986	Mentor Medical Limited
DIGNITI-CARE	1267350	United Kingdom	May 17, 1986	Mentor Medical Limited
DIGNITI-CARE	1306247	United Kingdom	April 4, 1987	Mentor Medical Limited
ECILEO	1295560	United Kingdom	May 19, 1989	Mentor Medical Limited
ECIURO	1295561	United Kingdom	February 10, 1989	Mentor Medical Limited
ELEFANT	3,047,408	US	January 24, 2006	Mentor Corporation
EVACARE	205,007	Turkey	November 12, 1998	Mentor Corporation
EVACARE	602,281	Mexico	February 26, 1999	Mentor Corporation
EVACARE	784,794	Australia	February 8, 1999	Mentor Corporation
EVACARE	963,660	CTM-Community Trademark	March 15, 2000	Mentor Corporation
EVACARE	1,770,943	Argentina	November 13, 2000	Mentor Corporation
EVACARE	6150-00	Ecuador	September 12, 2000	Mentor Corporation
EVACARE	2,753,326	US	August 19, 2003	Mentor Corporation
EXCEL	2,916,636	US	January 4, 2005	Mentor Corporation
EXCEL	3,376,341	CTM-Community Trademark	September 29, 2005	Mentor Corporation
FAS-TAP	923,769	Australia	January 23, 2003	Mentor Corporation
FAS-TAP	617,835	Canada	August 27, 2004	Mentor Corporation
FAS-TAP	VR 2003 00503	Denmark	February 6, 2003	Mentor Corporation
FAS-TAP	30241554	Germany	February 28, 2003	Mentor Corporation
FAS-TAP	2,308,134	United Kingdom	December 17, 2004	Mentor Corporation
FAS-TAP	2,765,401	US	September 16, 2003	Mentor Corporation
FEMICEP	1261400	United Kingdom		Mentor Medical Limited
FOLAFLATE	1014705	United Kingdom		Mentor Medical Limited
FOLATEX	1477466	France	July 13, 1988	Mentor Medical Limited
FOLATEX	51149	Iran		Mentor Medical Limited
FOLATEX	373006	Italy		Mentor Medical Limited
FOLATEX	1983445	Japan	September 21, 1987	Mentor Medical Limited
FOLATEX MEDICAL EQUIPMENT	103512	New Zealand		Mentor Medical Limited
FOLATEX	115435	New Zealand		Mentor Medical Limited
FOLATEX	201232	Portugal	June 4, 1986	Mentor Medical Limited

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Trademark Reg. Number Country Registration Date Owner

FOLATEX	79/0011	South Africa		Mentor Medical Limited
FOLATEX	851778	Spain	March 16, 1978	Mentor Medical Limited
FOLATEX	781769	United Kingdom	September 15, 1958	Mentor Medical Limited
FOLEC	1482543	France	August 10, 1988	Mentor Medical Limited
FOLEC	1,072,962	Germany	January 24, 1985	Mentor Medical Limited
FOLEC	51152	Iran		Mentor Medical Limited
FOLEC	3204300	Japan	September 30, 1996	Mentor Medical Limited
FOLEC	201233	Portugal	June 4, 1986	Mentor Medical Limited
FOLEC	79/0010	South Africa		Mentor Medical Limited
FOLEC	900315	Spain	July 5, 1979	Mentor Medical Limited
FREEDOM	1,539,221	US	May 16, 1989	Mentor Corporation
FREEDOM	165,423	CTM-Community Trademark	May 28, 1998	Mentor Corporation
FREEDOM & SAILBOAT DESIGN	909,074	Mexico	November 22, 2005	Mentor Corporation
FREEDOM CATH	1,267,844	US	February 21, 1984	Mentor Corporation
FREEDOM CATH AND SAILBOAT DESIGN	1,350,513	US	July 23, 1985	Mentor Corporation
FREEDOM CATH	165,373	CTM-Community Trademark	June 22, 1998	Mentor Corporation
FREEDOM-CATH	567,561	Benelux	March 6, 1995	Mentor Benelux B.V.
FREEDOM CLEAR	160,010	CTM-Community Trademark	May 28, 1998	Mentor Corporation
FREEDOM CLEAR	590,675	Benelux	January 6, 1997	Mentor Corporation
FREEDOM CLEAR	2,111,147	US	November 4, 1997	Mentor Corporation
FREEDOM CLEAR ADVANTAGE	567,559	Benelux	March 16, 1995	Mentor Benelux B.V.
FREEDOM	567,560	Benelux	March 6, 1995	Mentor Benelux B.V.
FREEDOM	298238	Colombia	June 20, 2005	Mentor Corporation
FREEDOM LUBRI-CATH	652,771	Benelux	May 7, 1999	Mentor Benelux B.V.
FREEDOM PAK	1,925,296	US	October 10, 1995	Mentor Corporation
FREEDOM PLUS		United Kingdom	T-Unregistered	Mentor Corporation
FREEDOM SELF-CATH	567,557	Benelux	March 6, 1995	Mentor Benelux B.V.
GENESIS	3,030,347	US	12/13/2005	Mentor Corporation
GUIDE STRIPE	2,066,404	US	June 3, 1997	Mentor Corporation
HOLSTA	1264607	United Kingdom		Mentor Medical Limited
HOLSTER	398087	Benelux		Mentor Medical Limited
HOLSTER	1023230	Germany		Mentor Medical Limited
HOLSTER	1255581	United Kingdom		Mentor Medical Limited
ISOCARTRIDGE	2,696,624	US	March 11, 2003	Mentor Corporation
ISOCHECK	2,843,718	US	May 18, 2004	Mentor Corporation

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Trademark Reg. Number Country Registration Date Owner

ISOLOADER and Design	2,849,393	US	June 1, 2004	Mentor Corporation
ISOLOADER	1,887,586	Argentina	September 27, 2002	Mentor Corporation
ISOLOADER	867,823	Australia	August 20, 2001	Mentor Corporation
ISOLOADER	621,222	Canada	September 30, 2004	Mentor Corporation
ISOLOADER	609,599	Chile	November 22, 2001	Mentor Corporation
ISOLOADER	249,390	Colombia	April 25, 2002	Mentor Corporation
ISOLOADER	2,110,278	CTM-Community Trademark	May 12, 2004	Mentor Corporation
ISOLOADER	147,200	Israel	January 2, 2002	Mentor Corporation
ISOLOADER	4,519,990	Japan	November 19, 2001	Mentor Corporation
ISOLOADER	702,903	Mexico	June 20, 2001	Mentor Corporation
ISOLOADER	214,199	Norway	April 25, 2002	Mentor Corporation
ISOLOADER	508,716	Switzerland	March 12, 2003	Mentor Corporation
ISOLOADER	2001/04190	Turkey	March 2, 2001	Mentor Corporation
ISOLOADER	2,642,888	US	October 29, 2002	Mentor Corporation
ISOLOADER	P-245045	Venezuela	June 27, 2003	Mentor Corporation
ISOSTRAND	2,988,014	US	August 23, 2005	Mentor Corporation
ISOSTRAND	703,020	Chile	September 9, 2004	Mentor Corporation
KRAYLEX	2,509,118	US	November 20, 2001	Mentor Corporation
LA BOMBITA	892108	Mexico	July 26, 2005	Mentor Corporation
MANHOOD	1,704,191	US	July 28, 1992	Mentor Corporation
MIRAGE	591836	Benelux	May 10, 1996	Mentor Medical Limited
MIRAGE	39622836	Germany	September 17, 1996	Mentor Medical Limited
MIRAGE	694006	Italy		Mentor Medical Limited
MIRAGE	2070653	United Kingdom	November 22, 1996	Mentor Medical Limited
OMNI 1 PIECE	1053424	Germany	September 7, 1983	Mentor Medical Limited
OMNI 1 PIECE	1,198,486	United Kingdom	June 27, 1983	Mentor Medical Limited
OMNI	1065802	Germany	July 12, 1984	Mentor Medical Limited
OMNI	1177188	United Kingdom	June 22, 1982	Mentor Medical Limited
POLYTEF	1,571,561	US	December 19, 1989	Mentor Corporation
PROSTASEED	2,570,366	US	May 14, 2002	Mills Biopharmaceuticals, Inc.
RESIST	2403228	CTM-Community Trademark	May 21, 2003	Mentor Corporation
RESIST	2,767,534	US	September 23, 2003	Mentor Corporation
RONOCATH	537299	Benelux	October 19, 1993	Mentor Medical Limited
RONOCATH	1552771	United Kingdom	November 5, 1993	Mentor Medical Limited
SABRE	2002/23068	Turkey	September 11, 2002	Mentor Corporation
SAILBOAT DESIGN	1,230,797	United Kingdom	May 1, 1987	Mentor Corporation

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Trademark Reg. Number Country Registration Date Owner

SAILBOAT DESIGN (BLACK AND WHITE)	1,342,408	US	June 18, 1985	Mentor Corporation
SCOTT	1,335,471	United Kingdom	February 15, 1988	Mentor Medical Limited
SEEDVUE	2,696,547	US	March 11, 2003	Mentor Corporation
SEEDVUE	642,708	Chile	September 23, 2002	Mentor Corporation
SEEDVUE	751,756	Mexico	June 26, 2002	Mentor Corporation
SEEL-A-PEEL	293391	Canada	July 27, 1984	Mentor Medical Limited
SEEL-A-PEEL	1979 3522	Denmark	November 23, 1979	Mentor Medical Limited
SEEL-A-PEEL	1101858	United Kingdom	September 22, 1978	Mentor Medical Limited
SELF-CATH	1,092,225	US	May 30, 1978	Mentor Corporation
SELF-CATH	185,736	CTM-Community Trademark	June 9, 1998	Mentor Corporation
SELF-CATH	928,602	Australia	May 15, 2003	Mentor Corporation
SELF-CATH	609,923	Canada	May 11, 2004	Mentor Corporation
SELF-CATH	496,009	Switzerland	March 19, 2002	Mentor Corporation
SERENADE	654,690	Benelux	September 17, 1992	Mentor Medical Limited
SERENADE	2,044,331	Germany	September 8, 1993	Mentor Medical Limited
SERENADE	150418	Ireland	December 18, 1992	Mentor Medical Limited
SERENADE	654,690	Italy		Mentor Medical Limited
SERENADE	160096	Norway	November 11, 1993	Mentor Medical Limited
SERENADE	317164	Portugal	November 4, 1998	Mentor Medical Limited
SERENADE	252396	Sweden	October 8, 1993	Mentor Medical Limited
SERENADE	401,084	Switzerland	April 21, 1993	Mentor Medical Limited
SERENADE	654,690	United Kingdom	September 9, 1992	Mentor Medical Limited
SILGRIP	1115158	Germany	December 3, 1987	Mentor Medical Limited
SILGRIP	1,332,030	United Kingdom	January 14, 1988	Mentor Medical Limited
SIMCARE	456507	Australia	December 3, 1986	Mentor Medical Limited
SIMCARE	456506	Australia	December 3, 1986	Mentor Medical Limited
SIMCARE	452106	Benelux	June 10, 1988	Mentor Medical Limited
SIMCARE	970966	China		Mentor Medical Limited
SIMCARE	109625	Finland	November 20, 1990	Mentor Medical Limited
SIMCARE	1384998	France	November 25, 1996	Mentor Medical Limited
SIMCARE	131547	Ireland	June 9, 1988	Mentor Medical Limited
SIMCARE	131546	Ireland		Mentor Medical Limited
SIMCARE	69559	Israel		Mentor Medical Limited
SIMCARE	69558	Israel		Mentor Medical Limited
SIMCARE	184633	New Zealand		Mentor Medical Limited

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Trademark Reg. Number Country Registration Date Owner

SIMCARE	184632	New Zealand		Mentor Medical Limited
SIMCARE	317156	Portugal	November 3, 1998	Mentor Medical Limited
SIMCARE	364695	Switzerland	October 13, 1988	Mentor Medical Limited
SIMCARE	1291818	United Kingdom	November 14, 1986	Mentor Medical Limited
SIMCARE URO-FLO	1363418	United Kingdom	November 14, 1998	Mentor Medical Limited
SIMCLENS	521911	Benelux	December 3, 1992	Mentor Medical Limited
SIMCLENS	1842 2003	Italy	February 24, 2003	Mentor Medical Limited
SIMCLENS	1520356	United Kingdom	December 3, 1993	Mentor Medical Limited
SPIROFLOW	648,506	Mexico	March 29, 2000	Mentor Corporation
SPIROFLOW	1,832,319	Argentina	June 5, 2001	Mentor Corporation
SPIROFLOW	1,244,458	CTM-Community Trademark	December 10, 2001	Mentor Corporation
STANDARD CARE	1,986,090	US	July 9, 1996	Mentor Corporation
STOMA SIEGEL	1027139	Germany	December 28, 1991	Mentor Medical Limited
SUSPEND	2,179,319	US	August 4, 1998	Mentor Corporation
SUSPEND	523,613	CTM-Community Trademark	December 8, 1999	Mentor Corporation
SUSPEND	732980	Australia	April 24, 1997	Mentor Corporation
SUSPEND	534,404	Canada	October 12, 2000	Mentor Corporation
SYMPHONY	500075	Australia		Mentor Medical Limited
SYMPHONY	452256	Benelux	June 10, 1988	Mentor Medical Limited
SYMPHONY	1384997	France	December 17, 1986	Mentor Medical Limited
SYMPHONY	127153	Ireland	June 9, 1988	Mentor Medical Limited
SYMPHONY	69560	Israel		Mentor Medical Limited
SYMPHONY	184631	New Zealand		Mentor Medical Limited
SYMPHONY	11715149M9	Spain	July 20, 1998	Mentor Medical Limited
SYMPHONY	257035	Sweden	April 8, 1994	Mentor Medical Limited
SYMPHONY	364696	Switzerland	October 13, 1998	Mentor Medical Limited
SYMPHONY	1291819	United Kingdom	November 14, 1986	Mentor Medical Limited
TELE-CATH	1,741,134	US	December 22, 1992	Mentor Corporation
TITAN	923,815	Australia	March 31, 2003	Mentor Corporation
TITAN	620,922	Canada	September 29, 2004	Mentor Corporation
TITAN	2,817,534	CTM-Community Trademark	November 12, 2003	Mentor Corporation
TITAN	158,874	Israel	September 2, 2003	Mentor Corporation
TITAN	504,131	Switzerland		Mentor Corporation
TITAN	2002/21063	Turkey	August 20, 2002	Mentor Corporation
TITAN	2,872,319	US	August 10, 2004	Mentor Corporation

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Page 55 of 179

Trademark Reg. Number Country Registration Date Owner

TRANSCATH	39903932	Germany	March 4, 1999	Mentor Medical Limited
TRANSCATH	2186962	United Kingdom	January 23, 1999	Mentor Medical Limited
TRANSFIX	2201911	United Kingdom	July 2, 1999	Mentor Medical Limited
TRI-FORM	2030307	Germany	February 15, 1993	Mentor Medical Limited
TRI-FORM	1410768	United Kingdom	January 15, 1990	Mentor Medical Limited
ULTRA-FRESH	1,549,786	US	August 1, 1989	Mentor Corporation
UNIVAL	868645	United Kingdom	August 2August 1964	Mentor Medical Limited
URISCAN	1489966	United Kingdom	February 5, 1992	Mentor Medical Limited
URO-FLO	T-Unregistered	United Kingdom	T-Unregistered	Mentor Medical Limited
URO-FLO	654,621	Italy		Mentor Medical Limited
URO-FLO	3,096,137	Japan	November 30, 1995	Mentor Medical Limited
URO-FLO	163,847	Norway	July 21, 1994	Mentor Medical Limited
UROFLO SILKIE	2049250	United Kingdom	December 19, 1995	Mentor Medical Limited
URO-FLO	314622	Sweden	July 28, 1996	Mentor Medical Limited
URO-FLO UNIQUE	1429535	United Kingdom	July 21, 1990	Mentor Medical Limited
URO-FLO XTEND	1384039	United Kingdom	May 24, 1989	Mentor Medical Limited
URO-SAN	1,128,211	US	December 25, 1979	Mentor Corporation
URO-TEX	2,506,011	US	November 13, 2001	Mentor Corporation

Mentor Urology Worldwide Trademark Applications and Unregistered Trademarks (Porges listed separately)

Trademark Application No. Country Application Date Status Owner

ALPINE FRESH		US		T-Unregistered	Mentor Corporation
ARIS	2589387	Argentina	May 11, 2005	Pending	Mentor Corporation
ARIS	827385099	Brazil	May 6, 2005	Pending	Mentor Corporation
ARIS (Porges)	124490600	Canada	January 26, 2005	Pending	Analytic Biosurgical Solutions-ABISS
ARIS	686346	Chile	May 9, 2005	Pending	Mentor Corporation
ARIS	4705780	China	June 7, 2005	Pending	Mentor Corporation
ARIS	4378154	CTM-Community Trademark	May 5, 2005	Pending	Mentor Corporation
ARIS	180498	Israel	May 5, 2005	Pending	Mentor Corporation
ARIS	2005-25470	Korea	June 3, 2005	Pending	Mentor Corporation
ARIS	2005/17860	Turkey	May 9, 2005	Pending	Mentor Corporation
ARIS	78/541,925	US	January 4, 2005	Pending	Mentor Corporation
ARIS (DESIGN)	78/638,258	US	May 26, 2005	Pending	Mentor Corporation
BACK IN CONTROL	78/508,331	US	October 29, 2004	Pending	Mentor Corporation
CLEAR ADVANTAGE		UK		T-Unregistered	Mentor Corporation

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Page 56 of 179

Trademark Application No. Country Application Date Status Owner

EASYOFF	76/470,468	US	November 27, 2002	T-Unregistered	Mentor Corporation
EVACARE	821,165,127	Brazil	October 23, 1998	Pending	Mentor Corporation
EXCEL	1,192,728	Canada	October 2, 2003	Pending	Mentor Corporation
E-Z HOLD		US		T-Unregistered	Mentor Corporation
FREEDOM SAILBOAT LOGO	827751656	Brazil	September 6, 2005	Pending	Mentor Corporation
FREEDOMSAILBOAT DESIGN	702381	Chile	September 6, 2005	Pending	Mentor Corporation
FREEDOM SAILBOAT DESIGN	66324	Puerto Rico	June 15, 2005	Pending	Mentor Corporation
FREEDOM SAILBOAT LOGO	78/647,514	US	June 9, 2005	Pending	Mentor Corporation
FREEDOM SAILBOAT DESIGN	2005-021111	Venezuela	September 23, 2005	Pending	Mentor Corporation
GIZMO		US		T-Unregistered	Mentor Corporation
GRIPZONE		US		T-Unregistered	Mentor Corporation
ISOLOADER	823624374	Brazil	March 1, 2001	Pending	Mentor Corporation
ISOLOADER	140,880	Egypt	March 10, 2001	Pending	Mentor Corporation
ISOSTRAND	8257544852	Brazil	August 7, 2003	Pending	Mentor Corporation
KIDS CAN CATH	76/564,038	US	December 8, 2003	Pending	Mentor Corporation
LA BOMBITA	78/647,467	US	June 9, 2005	Pending	Mentor Corporation
LA BOMBITA	722624	Mexico	June 13, 2005	Pending	Mentor Corporation
LOCKOUT		US		T-Unregistered	Mentor Corporation
NOVASILK	78/677,825	US	July 25, 2005	Pending	Mentor Corporation
NOVASILK	4519096	CTM-Community Trademark	July 28, 2005	Pending	Mentor Corporation
POP-SPEC	US 78/364,264	US	February 6, 2004	Pending	Mentor Corporation
POST-CATH	78/377,774	US	March 3, 2004	Pending	Mentor Corporation
RESIPUMP		US		T-Unregistered	Mentor Corporation
Selene	3811486	CTM-Community Trademark	May 15, 2004	Pending	Mentor Corporation
Selene	76/562,200	US	November 14, 2003	Pending	Mentor Corporation
SELF-CATH HYDROGEL	4168258	CTM-Community Trademark	December 11, 2004	Pending	Mentor Corporation
SELF-CATH HYDROGEL	78/528,684	US	December 7, 2004	Pending	Mentor Corporation
SELF-CATH PLUS		US		T-Unregistered	Mentor Corporation
SHIELD SKIN		US		T-Unregistered	Mentor Corporation
TITAN	824903803	Brazil		Pending	Mentor Corporation
TRIWASH		US		T-Unregistered	Mentor Corporation

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Page 57 of 179

Porges Trademarks

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

AGRIP'STON (Dénomination)	1
		Communautaire	(I) 10	March 5, 2001	May 5, 2001 2113942	May 8, 2002 2113942	March 4, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BELGIQUE; CHYPRE; DANEMARK; ESPAGNE; ESTONIE; FINLANDE; FRANCE; GRÈCE; HONGRIE; IRLANDE; ITALIE, LETTONIE; LITUANIE; LUXEMBOURG; MALTE; PAYS-BAS; POLOGNE; PORTUGAL; ROYAUME-UNI; SLOVAQUIE; SLOVÉNIE, SUÈDE, TCHÈQUE,
		FRANCE	(I) 10	March 2, 2001	March 2, 2001 01 3 087 414	March 2, 2001 01 3 087 414	March 1, 2011	Titulaire actuel : Porges SAS
ANGIO-BASKET (Dénomination)	1
		International	(I) 10	*	April 10, 1989 536 774	April 10, 1989 536 774	October 4, 2009	Titulaire actuel : Porges SAS	Pays revendiqués : ALGÉRIE; ALLEMAGNE; AUTRICHE; BÉLARUS; BENELUX; BULGARIE; ÉGYPTE; ESPAGNE; HONGRIE; ITALIE; KAZAKHSTAN; MAROC; MONACO; PORTUGAL (AB); ROUMAINE; RUSSIE, FÉDÉRATION DE; SUISSE; YOUGOSLAVIE
ARIS (Vignette)	1
		FRANCE	(I) 10	January 11, 2005	January 11, 2005 05 3 334 168		January 11, 2115	Titulaire actuel : Porges SAS
		International	(I) 10					Titulaire actuel : Porges SAS	Pays revendiqués : CHINE; JAPON
BIOSOFT (Dénomination)	1
		DANEMARK	(I) 10; 17	May 5, 1995	May 5, 1995 3441/95	August 2, 1996 VR 4501	August 2, 2006	Titulaire actuel : Porges SAS
		FINLANDE	(I) 10; 17	March 8, 1995	March 8, 1995 1407/95	August 15, 1996 201 270	August 15, 2006	Titulaire actuel : Porges SAS
		FRANCE	(I) 10; 17	May 16, 1994	April 29, 2004 94 520 289	July 9, 2004 94 520 289	May 16, 2014	Titulaire actuel : Porges SAS
		International	(I) 10; 17	January 6, 1995	January 6, 1995 631 256	January 6, 1995 631 256	June 1, 2015	Titulaire actuel : Porges SAS	Pays revendiqués : ALGÉRIE; ALLEMAGNE; AUTRICHE; BÉLARUS; BENELUX; CHINE; ÉGYPTE; ESPAGNE; HONGRIE; ITALIE, KAZAKHSTAN; KIRGHIZISTAN; MACÉDOINE; MAROC; MONACO; OUZBÉKISTAN; POLOGNE; PORTUGAL; ROUMANIE; RUSSIE, FÉDÉRATION DE; SLOVAQUIE; SUISSE; TADJIKISTAN
		IRLANDE	(I) 10; 17	February 28, 1995	February 28, 1995 173 286	February 5, 2002 173 286	February 28, 2012	Titulaire actuel : Porges SAS
		ISRAËL	(I) 17	March 31, 1995	March 31, 1995 97 866	March 31, 1995 97 866	March 31, 2016	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		ISRAËL	(I) 10	March 31, 1995	March 31, 1995 97 865	March 31, 2002 97 865	March 31, 2116	Titulaire actuel : Porges SAS
		JAPON	(I) 17	November 21, 1986	November 11, 1986 123378/86	September 30. 1998 2 081 488	September 30, 2008	Titulaire actuel : Porges SAS
		LIBAN	(I) 10; 17	March 29, 1995	March 29, 1995 591/295461	March 30, 1995 65 417	March 29, 2010	Titulaire actuel : Porges SAS
		NORVÈGE	(I) 10; 17	March 14, 1995	March 14, 1995 951 672	March 13, 1997 180 495	March 13, 2007	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10; 17	March 1, 1995	October 1, 2005 2 012 920	January 26, 2005 2 012 920	March 1, 2015	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 1	December 18, 1991	December 18, 1991 1 455 989	December 18, 1998 1 455 989	December 18, 2008	Titulaire actuel : Porges SAS
		SUÈDE	(I) 10; 17	March 1, 1996	March 1, 1996 95-2475	February 2, 1996 308 720	February 16, 2006	Titulaire actuel : Porges SAS
		TUNISIE	(I) 10; 17	March 28, 1995	March 28, 1995 EE950412	March 28, 1995 EE950412	March 28, 2010	Titulaire actuel : Porges SAS
COBRA (Dénomination)	1
		FRANCE	(I) 10	December 15, 2004	15/12/04 04 3 329 708		December 15, 2014	Titulaire actuel : Porges SAS
COELIODRAIN (Dénomination)	1
		FRANCE	(I) 10	March 30, 1994	February 6, 2004 94 513 537	April 4, 2004 94 513 537	March 30, 2014	Titulaire actuel : Porges SAS
		International	(I) 10	December 23, 1994	December 23, 1994 629 284	December 23, 1994 629 284	December 23, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE, ESPAGNE; ITALIE
		IRLANDE	(I) 10	September 30, 1994	September 30, 1994 94/6023	September 30, 2001 165460	September 30, 2011	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10	October 3, 1994	October 3, 1994 1 586 545	October 3, 2001 1 586 545	October 3, 2011	Titulaire actuel : Porges SAS
COROLEM (Dénomination)	1
		AFRIQUE DU SUD	(I) 10	August 8, 1988	August 8, 1998 88/6833	August 8, 1998 88/6833	August 8, 2008	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	July 25, 1988	July 25, 1998 1 479 635	July 25, 1998 1 479 635	July 25, 2008	Titulaire actuel : Porges SAS

Seller Listing Schedules

Page 59 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		GRÈCE	(I) 10	August 17, 1988	August 17, 1998 90 223	August 17, 1998 90 223	August 17, 2008	Titulaire actuel : Porges SAS
		International	(I) 10	December 28, 1988	December 28, 1988 530 755	December 28, 1988 530 755	December 28, 2008	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE, BENELUX; ESPAGNE (AB); ITALIE; LIECHTENSTEIN; SUISSE
COROLEM +logo (Dénomination + Logo)	1
		AFRIQUE DU SUD	(I) 10	February 14, 1989	August 21, 1998 89/1122	August 21, 1998 89/1122	February 14, 2009	Titulaire actuel : Porges SAS
		International	(I) 10	April 18, 1989	April 18, 1989 537 617	April 18, 1989 537 617	April 18, 2009	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE, BENELUX; ESPAGNE; ITALIE; LIECHTENSTEIN; SUISSE
CYSTODRAIN (Dénomination)	1
		AFRIQUE DU SUD	(I) 10	February 16, 1994	February 5, 2004 94/1595	February 5, 2004 94/1595	February 16, 2014	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	August 10, 1992	August 10, 2002 92 430 194	August 10, 2002 92 430 194	August 10, 2012	Titulaire actuel : Porges SAS
		International	(I) 10	*	January 15, 1993 595 687	January 15, 1993 595 687	January 15, 2008 January 15, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALGÉRIE; ALLEMAGNE (AB); AUTRICHE, BENELUX; BULGARIE; ÉGYPTE; ESPAGNE; HONGRIE; ITALIE; MAROC; PORTUGAL; ROUMANIE; RUSSIE; FÉDÉRATION DE; SLOVAQUIE, SUISSE (AB); TCHÈQUE, RÉPUBLIQUE; YOUGOSLAVIE
		JAPON	(I) 10	February 15, 1994	February 15, 1994 014687/94	April 11, 1997 3280538	April 11, 2007	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10	October 6, 1992	August 10, 1999 1514606	August 10, 1999 1514606	August 10, 2009	Titulaire actuel : Porges SAS
CYSTODRAIN Porges + LOGO (Dénomination + Logo)	1
		SUISSE	(I) 10	June 13, 1994	June 13, 2004 422118	June 13, 2004 422118	June 13, 2014	Titulaire actuel : Porges SAS
CYSTODRAINPU (Dénomination)	1
		ALLEMAGNE	(I) 10	May 10, 1999	May 10, 1999 399 27 154 6	July 7, 2000 399 27 154	May 13, 2009	Titulaire actuel : Porges SAS
derma-biodor (Dénomination)	1
		ALLEMAGNE	(I) 5	July 29, 1999	July 29, 1999 399 44 902.7	October 5, 1999 39944 902.7/05	July 29, 2009	Titulaire actuel : Porges GmbH

Seller Listing Schedules

Page 60 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

derma-dor (Dénomination)	1
		ALLEMAGNE	(I) 5	October 1, 1985	October 10, 1995 1 104 768	October 10, 1995 1 104 768	October 1, 2005	Titulaire actuel : Porges GmbH
DETOUR (Dénomination)	1
		Communautaire	(I) 10	January 24, 2001	January 24, 2001 002051498	January 24, 2002 002051498	January 24, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BELGIQUE; CHYPRE; DANEMARK; ESPAGNE; ESTONIE; FINLANDE; FRANCE; GRÈCE; HONGRIE; IRLANDE; ITALIE; LETTONIE, LITUANIE; LUXEMBOURG; MALTE; PAYS-BAS; POLOGNE; PORTUGAL; ROYAUME-UNI; SLOVAQUIE; SLOVÉNIE, SUÈDE, TCHÈQUE
		FRANCE	(I) 10	January 3, 2000	January 3, 2000 00 3 000 394	January 3, 2000 00 3 000 394	January 3, 2010	Titulaire actuel : Porges SAS
		International	(I) 10	January 30, 2001	January 30, 2001 750 708	January 30, 2001 750 708	January 30, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALBANIE; BOSNIE-HERZÉGOVINE; CROATIE; ESTONIE; HONGRIE; LETTONIE; LITUANIE; NORVÈGE; POLOGNE; ROUMANIE; SLOVAQUIE; SLOVÉNIE; SUISSE; TCHÈQUE, RÉPUBLIQUE; TURQUIE; YOUGOSLAVIE
		JAPON	(I) 10	December 13, 2000	December 13, 2000 2000-134040	January 25, 2002 4539150	January 25, 2012	Titulaire actuel : Porges SAS
DIABOLO (Dénomination)	1
		FRANCE	(I) 10	September 1, 1998	September 1, 1998 98 747 899	September 1, 1998 98 747 899	September 1, 2008	Titulaire actuel : Porges SAS
		International	(I) 10	February 12, 1999	February 12, 1999 709 273	February 12, 1999 709 273	December 2, 2009 December 2, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; DANEMARK; ESPAGNE; ITALIE; NORVÈGE; PORTUGAL; ROYAUME-UNI; SUÈDE; SUISSE; TURQUIE
DORMIA (Dénomination)	1
		AFRIQUE DU SUD	(I) 10	May 17, 1985	May 17, 2005 85/3492	May 17, 2005 85/3492	May 17, 2015	Titulaire actuel : Porges SAS
		ARGENTINE	(I) 10	May 21, 1985	December 27, 1996 2063220	October 17, 1997 1 647 738	October 17, 2007	Titulaire actuel : Porges SAS
		BRĖSIL	(I) 10	October 1, 1978	August 25, 1999 006976948	August 25, 1999 006976948	August 25, 2009	Titulaire actuel : Porges SAS

Seller Listing Schedules

Page 61 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

CANADA	(I) 10	June 27, 1985	April 18, 2001 316 088	July 4, 2001 316 088	July 4, 2016	Titulaire actuel : Porges SAS
CHINE	(I) 10	May 14, 1986	February 21, 1997 970000419	March 9, 1997 280056	March 9, 2007	Titulaire actuel : Porges SAS
CORĖE, RĖPUBLIQUE DE	(I) 10	June 22, 1985	November 1, 1995 95-5972	December 24, 1996 127865	July 29, 2006	Titulaire actuel : Porges SAS
CORĖE, RĖPUBLIQUE DE	(I) 10	June 22, 1885	November 1, 1995 95-5969	December 24, 1996 127868	July 29, 2006	Titulaire actuel : Porges SAS
DANEMARK	(I) 10	May 13, 1985	May 9, 1996 1116 1985	May 9, 1996 1116 1986	May 9, 2006	Titulaire actuel : Porges SAS
ĖTATS-UNIS	(I) 10	October 14, 1986	October 14, 1986 625 234	June 2, 1987 1 441 126	June 2, 2007	Titulaire actuel : Porges SAS
FINLANDE	(I) 10	May 15, 1985	April 18, 1997 T198501673	January 5, 1997 97563	January 5, 2007	Titulaire actuel : Porges SAS
FRANCE	(I) 10	April 11, 1978	March 23, 1998 1 456 937	March 23, 1998 1 456 937	March 23, 2008	Titulaire actuel : Porges SAS
INDE	(I) 10	June 14, 1985	June 13, 1999 439099	June 13, 1999 439099	June 13, 2006	Titulaire actuel : Porges SAS
International	(I) 10	August 11, 1978	August 11, 1998 R 439 051	August 11, 1998 R 439 051	November 8, 2008 November 3, 2011	Titulaire actuel : Porges SAS	Pays revendiquės : ALGĖRIE, ALLEMAGNE; AUTRICHE; BĖLARUS; BENELUX; BULGARIE; CROATIE; ĖGYPTE; ESPAGNE; HONGRIE; ITALIE; KAZAKHSTAN; MACĖDOINE; MAROC; PORTUGAL; ROUMANIE; RUSSIE, FĖDĖRATION DE; SLOVAQUIE SLOVĖNIE; SUISSE; TCHĖQUE, RĖPUBLIQUE; UKRAINE; YOU
International	(I) 10		March 10, 1993 598 008	Marach 10, 1993 598 008	March 20, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : POLOGNE
IRLANDE	(I) 10	November 18, 1985	November 18, 1992 117167	November 18, 1992 117167	November 17, 2006	Titulaire actuel : Porges SAS
JAPON	(I) 10	October 2, 1978	August 27, 2002 1535638	August 27, 2002 1535638	August 27, 2012	Titulaire actuel : Porges SAS
MEXIQUE	(I) 10	September 30, 1993	July 31, 2003 467087	September 30, 2003 467087	September 30, 2013	Titulaire actuel : Porges SAS
NORVĖGE	(I) 10	May 14, 1985	June 12, 1996 125 453	June 12, 1996 125 453	June 12, 2006	Titulaire actuel : Porges SAS
ROYAUME-UNI	(I) 10	October 5, 1978	April 11, 1999 1102450	April 11, 1999 1102450	April 11, 2009	Titulaire actuel : Porges SAS

Seller Listing Schedules

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		SUĖDE	(I) 10	May 20, 1985	January 10, 1996 199357	January 10, 1996 199357	January 10, 2006	Titulaire actuel : Porges SAS
		TAIWAN, PROVINCE DE CHINE	(N) 82	May 24, 1985	March 16, 1996 318 305	March 16, 1996 318 305	March 15, 2006	Titulaire actuel : Porges SAS
		TURQUIE	(I) 10	April 11, 1988	March 27, 1998 17946	April 11, 1998 104378	April 11, 2008	Titulaire actuel : Porges SAS
		VENEZUELA	(N) 044	February 19, 1987	February 19, 1987 0002100-87	January 7, 1991 0139963	January 7, 2006	Titulaire actuel : Porges SAS
DORMIA KATAKANA (Graphisme)	1
		JAPON	(I) 10	March 10, 1986	October 26, 1998 2085827	October 26, 1998 2085827	October 26, 2008	Titulaire actuel : Porges SAS
DUET (Dėnomination)	1
		ALLEMAGNE	(I) 5, 10	February 14, 1992	February 14, 2002 2 012 161	February 14, 2002 2 012 161	February 14, 2012	Titulaire actuel : Porges GmbH
ECICOLO (Dėnomination)	1
		ALLEMAGNE	(I) 10	February 4, 1987	February 4, 1997 1 113 376	February 4, 1997 1 113 376	February 4, 2007	Titulaire actuel : Porges GmbH
ECIILEO (Dėnomination)	1
		ALLEMAGNE	(I) 10	February 4, 1987	February 4, 1997 1 113 379	February 4, 1997 1 113 379	February 4, 2007	Titulaire actuel : Porges GmbH
ECIPOSTOP (Dėnomination)	1
		ALLEMAGNE	(I) 10	February 4, 1987	February 4, 1997 1 113 377	February 4, 1997 1 113 377	February 4, 2007	Titulaire actuel : Porges GmbH
ELEFANT (Dėnomination)	1
		FRANCE	(I) 10	February 10, 2003	February 10, 2003 03 3 208 710	February 10, 2003 03 3 208 710	February 10, 2013	Titulaire actuel : Porges SAS
		International	(I) 10	July 29, 2003	July 29, 2003 809 344	July 29, 2003 809 344	July 29, 2008 July 07, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; DANEMARK; ESPAGNE; FINLANDE; GRECE; IRLANDE, ITALIE; JAPON; PORTUGAL; ROYAUME-UNI, SUĖDE

Seller Listing Schedules

Page 63 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

EMBLEME Porges (Logo)	1
		International	(I) 10	#######	October 3, 2004 289 414	April 21, 2004 289 414	March 10, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; ĖGYPTE; ESPAGNE; HONGRIE; ITALIE, LIECHTENSTEIN; MAROC; MONACO; PORTUGAL (AB); ROUMANIE; SAINT-MARIN; SUISSE, YOUGOSLAVIE
		TUNISIE	(I) 10	October 3, 1964	September 30, 2004 EE042012			Titulaire actuel : Porges SAS
EUROLOGY (Dėnomination)	1
		FRANCE	(I) 10; 16; 41; 42	May 26, 1993	May 26, 2003 93 469 678	May 26, 2003 93 469 678	May 26, 2013	Titulaire actuel : Porges SAS
		International	(I) 10; 16; 41; 42	November 5, 1993	November 5, 1993 609 483	November 5, 1993 609 483	November 5, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; ESPAGNE; ITALIE; PORTUGAL (AB); SUISSE
EXTERNADOM (Dėnomination)	1
		FRANCE	(I) 10	December 22, 1987	December 22, 1997 1 441 340	December 22, 1997 1 441 340	December 22, 1997	Titulaire actuel : Porges SAS
FOLURINE (Dėnomination)	1
		FRANCE	(I) 10	April 19, 2001	April 19, 2001 01 3 097 267	April 19, 2001 01 3 097 267	April __, 2011	Titulaire actuel : Porges SAS
FOLYSIL (Dėnomination)	1
		AFRIQUE DU SUD	(I) 10	February 4, 2094	February 5, 2004 94/1078	February 5, 2004 94/1078	February 4, 2014	Titulaire actuel : Porges SAS
		ARGENTINE	(I) 10	September 3, 1991	September 19, 2003 2 461 510	February 19, 2004 1 970 941	February __, 2014	Titulaire actuel : Porges SAS
		AUSTRALIE	(I) 10	June 13, 1985	June 13, 1992 A 428230	June 13, 1992 A 428230	June 13, 2006
		CHINE	(I) 10	May 14, 1986	February 21, 1997 970000423	March 9, 1997 280058	September 3, 2007	Titulaire actuel : Porges SAS
		DANEMARK	(I) 10	April 16, 1980	October 17, 2000 VR 1980 03962	October 17, 2000 VR 1980 03962	October 17, 2010	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		ĖTATS-UNIS	(I) 10	February 4, 1988	February 4, 1988 709 418	October 10, 25, 1988 1 510 009	October 25, 2008	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	February 2, 1980	February 21, 2000 1 583 855	February 21, 2000 1 583 855	February 21, 2010	Titulaire actuel : Porges SAS
		GRĖCE	(I) 10	February 28, 1994	February 28, 2004 118,019	February 28, 2004 118,019	February 28, 2014	Titulaire actuel : Porges SAS
		International	(I) 10	April 10, 1980	April 10, 2000 R 452 543	April 10, 2000 R 452 543	April 10, 2010 April 10, 2015	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BĖLARUS; BENELUX; BOSNIE-HERZEGOVINE; CROATIE; ĖGYPTE; ESPAGNE; HONGRIE; ITALIE; MACĖDOINE; MAROC; MONACO; PORTUGAL; ROUMANIE; RUSSIE; FĖDĖRATION DE; SLOVAQUIE; SLOVĖNIE; SUISSE; TCHĖQUE, RĖPUBLIQUE, UKRAIN
		IRLANDE	(I) 10	April 23, 1980	April 22, 2001 97219	April 22, 2001 97219	April 22, 2011	Titulaire actuel : Porges SAS
		ISRAĖL	(I) 10	February 7, 1994	February 6, 2001 91107	February 6, 2001 91107	February 6, 2015	Titulaire actuel : Porges SAS
		JAPON	(I) 10	April 23, 1980	August 27, 1994 1732318	April 27, 1995 1732318	November 27, 2004	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	June 11, 1985	April 17, 1996 124 896	April 17, 1996 124 896	April 17, 2006	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10	April 16, 1980	February 21, 2001 1132129	February 21, 2001 1132129	February 21, 2011	Titulaire actuel : Porges SAS
		TUNISIE	(I) 10	April 10, 1980	April 10, 2000 EE000589	April 10, 2000 EE000589	April 10, 2015	Titulaire actuel : Porges SAS
		TURQUIE	(I) 10	May 13, 1994	May 28, 2004 66213	May 13, 2004 153357	May 13, 2014	Titulaire actuel : Porges SAS
FRIDAY (Dėnomination)	1
		Communautaire	(I) 10	February 27, 2001	February 27, 2001 002185460	April 18,02 002185460	February 27, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEGNE, AUTRICHE; BELLGIQUE; CHYPRE; DANEMARK; ESPAGNE; ESTONIE; FINLANDE; FRANCE; GRĖCE; HONGRIE; IRLANDE, ITALIE; LETTONIE; LITUANIE; LUXEMBOURGE; MALTE; PAYS-BAS; POLOGNE; PORTUGAL; ROYAUME-UNI; SLOVAQUIE; SLOVĖNIE; SUĖDE; TCHĖQUE
		FRANCE	(I) 10	January 23, 2001	January 23, 2001 01 3 079 470	January 23, 2001 01 3 079 470	January 23, 2011	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		International	(I) 10	June 11, 2001	June 11, 2001 762 270	June 11, 2001 762 270	June 11, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALBANIE; BOSNIE-HERZĖGOVINE (AB), CROATIE; ESTONIE; HONGRIE; JAPON; LETTONIE; LITUANIE; NORVĖGE; POLOGNE; ROUMANIE; SLOVAQUIE; SLOVĖNIE; SUISSE; TCHĖQUE, RĖPUBLIQUE; TURQUIE; YOUGOSLAVIE
GUILPLAST (Dėnomination)	1
		CHINE	(I) 10	May 14, 1986	May 14, 1986 19836	March 10, 1997 R280069	March 10, 2007	Titulaire actuel : Porges SAS
HELIKAL (Dėnomination)	1
		Communautaire	(I) 10	April 20, 2004	April 20, 2004 003783388		April 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BELGIQUE; CHYPRE; DANEMARK; ESPAGNE; ESTONIE; FINLANDE; FRANCE; GRĖCE; HONGRIE; IRLANDE; ITALIE; LETTONIE, LITUANIE; LUXEMBOURG; MALTE; PAYS-BAS; POLOGNE; PORTUGAL; ROYAUME-UNI;SLOVAQUIE; SLOVĖNIE; SUĖDE; TCHĖQUE
IN-KA (Dėnomination)	1
		FRANCE	(I) 10	July 21, 2003	July 21, 2003 03 3 237 442	July 21, 2003 03 3 237 442	July 21, 2013	Titulaire actuel : Porges SAS
		International	(I) 10	January 20, 2004	January 20, 2004 818 432	January 20, 2004 818 432	January 20, 2009 January 20, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; DANEMARK; ESPAGNE; FINLANDE; GRĖCE; IRLANDE; ITALIE; PORTUGAL; ROYAUME-UNI; SUĖDE
KOLIBRI (Dėnomination)	1
		CANADA	(N)		January 23, 2003 1 165 453			Titulaire actuel : Porges SAS
		FRANCE	(I) 10	July 30, 2002	July 30, 2002 02 3 177 283	July 30, 2002 02 3 177 283	July 30, 2012	Titulaire actuel : Porges SAS
		International	(I) 10	January 22, 2003	January 22, 2003 797 096	January 22, 2003 797 096	January 22, 2008 January 22, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; DANEMARK; ESPAGNE; FINLANDE; GRĖCE; IRLANDE; ITALIE, PORTUGAL; ROYAUME-UNI; SUĖDE
LE CLIC (Dėnomination)	1
		FINLANDE	(I) 10	March 7, 1995	March 07, 1995 1396/95	May 15, 1996 200359	May 15, 2006	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		International	(I) 10	January 6, 1995	January 06, 1995 629 561	January 06, 1995 629 561	June 01, 2015	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BĖLARUS; BENELUX; ESPAGNE; HONGRIE; ITALIE; KAZAKHSTAN; KIRGHIZISTAN; MAROC; QUZBĖKISTAN; POLOGNE; PORTUGAL (AB), ROUMANIE; RUSSIE, FĖDĖRATION DE; SLOVAQUIE; SUISSE; TADJIKISTAN; TCHĖQUE, RĖPUBLIQUE; UKRAIN
		LIBAN	(I) 10	March 29, 1995	March 29, 1995 065416	March 29, 1995 065416	March 29, 2010	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	March 14, 1995	March 14, 1995 19951671	October 10, 1996 177287	October 10, 2006	Titulaire actuel : Porges SAS
		SUĖDE	(I) 10	April 20, 1995	April 20, 1995 95-04749	February 23, 1996 309098	February 23, 2006	Titulaire actuel : Porges SAS
		TUNISIE	(I) 10	March 28, 1995	March 28, 1995 EE95.0411	March 28, 1995 EE95.0411	March 28, 2010	Titulaire actuel : Porges SAS
MINUTE STENT (Dėnomination)	1
		FRANCE	(I) 10	July 29, 1999	July 29, 1999 99 806 386	July 29, 1999 99 806 386	July 29, 2009	Titulaire actuel : Porges SAS
N.Stone (Dėnomination)	1
		FRANCE	(I) 10	June 20, 2003	June 20, 2003 03 3 232 195	June 20, 2003 03 3 232 195	June , 2013	Titulaire actuel : Porges SAS
		International	(I) 10	December 19, 2003	December 19, 2003 817 185	December 19, 2003 817 185	December 19, 2008 December 19, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BELELUX; DANEMARK; ESPAGNE; FINLANDE; GRĖCE; IRLANDE, ITALIE; JAPON; PORTUGAL; ROYAUME-UNI; SUĖDE
NEOPLEX (Dėnomination)	1
		ALLEMAGNE	(I) 10	April 25, 1957	April 25, 1997 737615	April 25, 1997 737615	April 25, 2007	Titulaire actuel : Porges SAS
		BRĖSIL	(N) 9	August 21, 1972	November 10, 1995 006159214	November 10, 1995 006159214	November 10, 2005	Titulaire actuel : Porges SAS
		CANADA	(I) 10	November 21, 1952	November 21, 1997 UCA45381	November 21, 1997 UCA45381	November 21, 2012	Titulaire actuel : Porges SAS
		CHINE	(I) 10	May 14, 1986	March 10, 1997 280057	March 10, 1997 280057	March 10, 2007	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

CORĖE, RĖPUBLIQUE DE	(I) 11	June 22, 1985	Septemer 17, 1996 130844	Septemer 17, 1996 130844	September17, 2006	Titulaire actuel : Porges SAS
CORĖE, RĖPUBLIQUE DE	(I) 11	June 22, 1985	July 29, 1996 127866	July 29, 1996 127866	July 29, 2006	Titulaire actuel : Porges SAS
ĖSTATS-UNIS	(I) 10	August 20, 1952	January 26, 1994 585050	January 26, 1994 585050		Titulaire actuel : Porges SAS
FINLANDE	(I) 10	May 15, 1985	August 20, 1997 99181	August 20, 1997 99181	August , 2007	Titulaire actuel : Porges SAS
FRANCE	(I) 10	December 17, 1948	July 25, 1998 1 479 636	July 25, 1998 1 479 636	July 25, 2008	Titulaire actuel : Porges SAS
INDE	(I) 17	June 14, 1985	June 14, 1999 439097	June 14, 1999 439097	June 14, 2006	Titulaire actuel : Porges SAS
INDE	(I) 10	June 14, 1985	June 14, 1999 439098	June 14, 1999 439098	June 14, 2006	Titulaire actuel : Porges SAS
International	(I) 10	July 7, 1951	July 07, 1991 2R154 775	July 07, 1991 2R154 775	July 07, 2006 July 07, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE, BENELUX; CROATIE, ĖGYPTE; ESPAGNE (AB); HONGRIE; ITALIE; LIECHTENSTEIN; MAROC; MONACO;PORTUGAL; ROUMANIE; SLOVAQUIE; SLOVĖNIE; SUISSE; TCHĖQUE, RĖPUBLIQUE; YOUGOSLAVIE
IRLANDE	(I) 17	November 18, 1985	November 18, 1992 117169	November 18, 1992 117169	November 18, 2006	Titulaire actuel : Porges SAS
IRLANDE	(I) 10	November 18, 1985	November 18, 1992 117168	November 18, 1992 117168	November 18, 2006	Titulaire actuel : Porges SAS
JAPON	(I) 10	April 17, 1980	February 28, 1996 1838861	February 28, 1996 1838861	February 28, 2006	Titulaire actuel : Porges SAS
JAPON	(I) 10	June 13, 1986	March 27, 1999 2122726	March 27, 1999 2122726	March 27, 2009	Titulaire actuel : Porges SAS
MEXIQUE	(I) 10	March 19, 1986	March 19, 1996 330066	March 19, 1996 330066	March 2006	Titulaire actuel : Porges SAS
NORVĖGE	(I) 10	May 14, 1985	Septemer 11, 1996 126 383	Septemer 11, 1996 126 383	September11, 2006	Titulaire actuel : Porges SAS
SUĖDE	(I) 10	August 29, 1980	August 29, 2000 173 402	August 29, 2000 173 402	August 29, 2010	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		TAIWAN, PROVINCE DE CHINE	(N) 82	January 31, 1986	February 01, 1996 314245	February 01, 1996 314245	January 31, 2006	Titulaire actuel : Porges SAS
		TAIWAN, PROVINCE DE CHINE	(N) 68	January 31, 1986	March 15, 1996 318158	March 15, 1996 318158	March 15, 2006	Titulaire actuel : Porges SAS
		TUNISIE	(I) 10	July 7, 1971	July 23, 1991 EE91.0597	July 23, 1991 EE91.0597	July 23, 2006	Titulaire actuel : Porges SAS
		TURQUIE	(I) 10; 17	April 11, 1988	April 11, 1998 103954	April 11, 1998 103954	April 11, 2008	Titulaire actuel : Porges SAS
OVEA (Dėnomination)	1
		DANEMARK	(N) 10	October 23, 1997	October 23, 1997 VA 05251 1997	November 14, 1997 VR 04920 1997	November 14, 2007	Titulaire actuel : Porges SAS
		FINLANDE	(I) 10	October 24, 1997	October 24, 1997 T199704129	October 15, 1998 211458	October 15, 2008	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	April 28, 1997	April 28, 1997 97 675 530	April 28, 1997 97 675 530	April 28, 2007	Titulaire actuel : Porges SAS
		GRĖCE	(I) 10	October 27, 1997	October 27, 1997 134.899	June 17, 1999 134.899	October 27, 2007	Titulaire actuel : Porges SAS
		International	(I) 10	October 22, 1997	October 22, 1997 681 511	October 22, 1997 681 511	October 22, 2007	Titulaire actuel : Porges SAS	Pays revendiqués : ALLMAGNE; AUTRICHE; BENELUX; ESPAGNE, ITALIE; PORTUGAL (AB); SUISSE
		IRLANDE	(I) 10	October 24, 1997	October 24, 1997 97/3961	October 24, 1997 207806	October 23, 2007	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	October 28, 1997	October 28, 1997 19978969	May 28, 1998 190491	May 28, 2008	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10	October 24, 1997	October 24, 1997 2148948	June 26, 1998 2148948	October 24, 2007	Titulaire actuel : Porges SAS
		SUĖDE	(I) 10	October 23, 1997	October 23, 1997 97-09464	October 01, 1999 333 359	October 1, 2009	Titulaire actuel : Porges SAS
		TURQUIE	(I) 10	October 27, 1997	October 27, 1997 16150	October 27, 1997 191 673	October 27, 2007	Titulaire actuel : Porges SAS
PENILEX (Dėnomination)	1
		CHINE	(I) 10	January 19, 1987	August 20, 1997 296244	August 20, 1997 296244	August , 2007	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	March 22, 1968	April 14, 1998 1 460 413	April 14, 1998 1 460 413	April 14, 2008	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		International	(I) 10	January 30, 1984	January 30, 2004 482 368	January 30, 2004 482 368	January 30, 2009 January 30, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BĖLARUS; BENELUX; CORĖE, RĖPUBLIQUE POPULAIRE DĖMOCRATIQUE DE; CROATIE; ĖGYPTE (AB); ESPAGNE; HONGRIE; ITALIE; KAZAKHSTAN; LIECHTENSTEIN; MAROC; MONACO; PORTUGAL; ROUMANIE; RUSSIE, FEDĖRATION DE; SLOVAQUIE,
		International	(I) 10	March 8, 1993	March 08, 1993 598 205	March 08, 1993 598 205	March 8, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : POLOGNE
		ROYAUME-UNI	(I) 10	January 19, 1993	January 19, 2000 1524337	January 19, 2000 1524337	January , 2010	Titulaire actuel : Porges SAS
		TUNISIE	(I) 10	January 30, 1984	January 27, 2004 EE 04 0222			Titulaire actuel : Porges SAS
PICKSTONE (Dėnomination)	1
		CANADA	(I) 10	September 17, 2001	Septemer 17, 2001 1 115 931	December 11, 2003 597, 268	December 11, 2018	Titulaire actuel : Porges SAS
		Communautaire	(I) 10		March 21, 2001 002140879	May 03, 2002 002140879	March 21, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BELGIQUE; CHYPRE; DANEMARK, ESPAGNE; ESTONIE; FINLANDE; FRANCE; GRĖCE, HONGRIE; IRLANDE; ITALIE, LETTONIE, LITUANIE; LUXEMBOURG, MALTE; PAYS-BAS; POLOGNE; PORTUGAL; ROYAUME-UNI; SLOVAQUIE; SLOVĖNIE; SUĖDE; TCHĖQUE
		ĖTATS -UNIS	(I) 10		Septemer 19, 1990 76-315 211	December 10, 2002 2 658 793	October 12, 2008 October 12, 2012	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	March 19, 2001	March 19, 2001 01 3 091 196	March 19, 2001 01 3 091 196	March, 2011	Titulaire actuel : Porges SAS
		International	(I) 10		Septemer 17, 2001 766 681	Septemer 17, 2001 766 681	September17, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALBANIE; BOSNIE-HERZĖGOVINE; CROATIE; ESTONIE; HONGRIE; JAPON; LETTONIE; LITUANIE; NORVĖGE; POLOGNE; ROUMANIE; SLOVAQUIE; SLOVĖNIE; SUISSE (AB); TCHĖQUE, RĖPUBLIQUE; TURQUIE; YOUGOSLAVIE
POLYBAX (Dėnomination)	1
		FRANCE	(I) 10; 17	September 8, 1986	Septemer 08, 1996 1 380 019	Septemer 08, 1996 1 380 019	September8, 2006	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		International	(I) 10; 17	January 12, 1987	January 12, 1987 509 124	January 12, 1987 509 124	December 01, 2007	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMANGE; AUTRICHE; BĖLARUS; BENELUX; ĖGYPTE (AB); ESPAGNE (AB); HONGRIE, ITALIE; KAZAKHSTAN; LIECHTENSTEIN; MAROC; MONACO; PORTUGAL (AB); ROUMANIE; RUSSIE, FĖDĖRATION DE; SAINT-MARIN; SUISSE; YOUGOSLAVIE
		TUNISIE	(I) 10; 17	January 12, 1987	January 12, 1987 509 124	January 12, 1987 509 124	January 12, 2007	Titulaire actuel : Porges SAS
Porges (Dėnomination)	1
		AFRIQUE DU SUD	(I) 10	February 16, 1994	February 05, 2004 94/1596	February 05, 2004 94/1596	February 16, 2014	Titulaire actuel : Porges SAS
		ARGENTINE	(I) 10	September 29, 1980	December 30, 2003 2 486 802	May 11, 2004 1 980 511	May 11, 2014	Titulaire actuel : Porges SAS
		CORĖE, RĖPUBLIQUE DE	(I) 11	October 7, 1986	December 15, 1997 148554	December 15, 1997 148554	December 15, 2007	Titulaire actuel : Porges SAS
		CORĖE, RĖPUBLIQUE DE	(I) 11	June 22, 1985	July 30, 1996 127 867	July 30, 1996 127 867	July 29, 2006	Titulaire actuel : Porges SAS
		ĖTATS-UNIS	(I) 10	July 6, 1994	July 06, 1994 74-546123	February 13, 1996 1 955 726	February 13, 2006	Titulaire actuel : Porges SAS
		FRANCE	(I) 9; 10	June 13, 1980	May 30, 2000 1 594 754	May 30, 2000 1 594 754	May 30, 2010	Titulaire actuel : Porges SAS
		GRĖCE	(I) 10	April 30, 1994	March 30, 2004 | 118 452	March 30, 2004 | 118 452	March 30, 2014	Titulaire actuel : Porges SAS
		International	(I) 9; 10	August 19, 1980	August 19, 2000 R 455 135	August 19, 2000 R 455 135	August 19, 2010 August 19, 2015	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BĖLARUS; BENELUX; BOSNIE-HERZĖGOVINE; CORĖE, RĖPUBLIQUE POPULAIRE DĖMOCRATIQUE DE; CROATIE; ĖGYPTE; ESPAGNE; HONGRIE; ITALIE; KAZAKHSTAN, LIECHTENSTEIN; MACĖDOINE, MAROC; MONACO; PORTUGAL; ROUMANIE; RUSSIE,
		International	(I) 9; 10	March 1, 1994	March 01, 1994 614 260	March 01, 1994 614 260	March 1, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : CHINE; POLOGNE
		JAPON	(I) 10	June 14, 1972	July 17, 2005 1133127	July 17, 2005 1133127	July 17, 2015	Titulaire actuel : Porges SAS
		JAPON	(I) 10	March 10, 1986	October 26, 1998 2 085 828	October 26, 1998 2 085 828	October 26, 2008	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		ROYAUME-UNI	(I) 10	September 16, 1980	Septemer 16, 2001 1 140 316	Septemer 16, 2001 1 140 316	September16, 2011	Titulaire actuel : Porges SAS
		TAIWAN, PROVINCE DE CHINE	(N) 82	May 16, 1986	December 16, 1996 350370	December 16, 1996 350370	December 15, 2006	Titulaire actuel : Porges SAS
		TUNISIE	(I) 9, 10	August 19, 1980	August 18, 2000 EE001646	August 18, 2000 EE001646	August , 2015	Titulaire actuel : Porges SAS
		VENEZUELA	(I) 9	January 30, 1981	Septemer 12, 1999 110.223F		September12, 2009	Titulaire actuel : Porges SAS
		VENEZUELA	(I) 10	April 21, 1988	April 21, 1988 6384	August 06, 1999 P-213,092	August 6, 2009	Titulaire actuel : Porges SAS
		VENEZUELA	(I) 9	October 7, 1980	June 21, 1999 108.854F		June 21, 2009	Titulaire actuel : Porges SAS
Porges + LOGO (Dėnomination + Logo)	1
		ANDORRE	(I) 9, 10	December 1, 1997	December 01, 1997 10044	December 01, 1997 10044	December 1, 2007	Titulaire actuel : Porges SAS
		ARABIE SAOUDITE	(I) 10	January 13, 1986	June 04, 2005 348			Titulaire actuel : Porges SAS
		ARGENTINE	(I) 5	October 21, 1987	March 10, 2000 1 778 520	March 10, 2000 1 778 520	March 10, 2010	Titulaire actuel : Porges SAS
		ARGENTINE	(I) 10	October 21, 1987	October 21, 1999 1 757 741	October 21, 1999 1 757 741	October 21, 2009	Titulaire actuel : Porges SAS
		AUSTRALIE	(I) 10	May 14, 1985	May 14, 1992 A426869	May 14, 1992 A426869	May 14, 2006	Titulaire actuel : Porges SAS
		BRĖSIL	(I) 10	June 2, 1986	July 31, 2000 812604504	July 31, 2000 812604504	July 31, 2010	Titulaire actuel : Porges SAS
		CANADA	(I) 10	June 27, 1985	October 03, 2001 544 999	October 03, 2001 TMA319,237	October 3, 2016	Titulaire actuel : Porges SAS
		CORĖE, RĖPUBLIQUE DE	(I) 10	June 22, 1985	November 01, 1995 95-5973	July 29, 1996 127864	July 29, 2006	Titulaire actuel : Porges SAS
		DANEMARK	(I) 10	May 13, 1985	May 09, 1996 01 110 1986	May 09, 1996 01 110 1986	May 9, 2006	Titulaire actuel : Porges SAS
		DOMINICAINE, RĖPUBLIQUE	(I) 10	June 17, 1989	June 13, 1999 0047026	June 13, 1999 0047026	June 13, 2008	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

ĖTATS-UNIS	(I) 10	March 9, 1981	March 09, 1981 300172	July 12, 1983 1245154	December 07, 2003	Titulaire actuel : Porges SAS
FINLANDE	(I) 10	May 15, 1985	April 21, 1997 98311	April 21, 1997 98311	April21, 2007	Titulaire actuel : Porges SAS
FRANCE	(I) 9; 10	January 29, 1981	January 25, 2001 1 640 932	January 25, 2001 1 640 932	January 25, 2011	Titulaire actuel : Porges SAS
GRĖCE	(I) 10	June 13, 1985	June 13, 2005 80 096		- -	Titulaire actuel : Porges SAS
HONDURAS	(I) 10	August 30, 1994	August 30, 1994 6450/94	June 25, 1996 65 119	June 25, 2006	Titulaire actuel : Porges SAS
HONG-KONG	(I) 10	May 18, 1985	May 18, 1992 176/86	May 18, 1992 176/86	May 18, 2006	Titulaire actuel : Porges SAS
INDE	(I) 10	June 14, 1985	June 14, 1985 439100			Titulaire actuel : Porges SAS
International	(I) 9; 10	March 26, 1993	March 26, 1993 598 704	March 26, 1993 598 704	March 26, 2008 March 26, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BENELUX; BOSNIE-HERZĖGOVINE; BULGARIE; CHINE; CROATIE; ĖGYPTE; ESPAGNE; HONGRIE; MACĖDOINE; MAROC; POLOGNE; PORTUGAL; ROUMANIE; SOVAQUIE; SLOVĖNIE; SUISSE; TCHĖQUE, RĖPUBLIQUE, YOUGOSLAVIE
IRLANDE	(I) 10	November 18, 1985	November 18, 1992 117555	November 18, 1992 117555	November 18, 2006	Titulaire actuel : Porges SAS
MALAISIE	(I) 10	May 29, 1985	April 24, 1992 MA/2285/85	May 29, 1992 85/02285	May 29, 2006	Titulaire actuel : Porges SAS
NORVĖGE	(I) 10	May 14, 1985	July 31, 1996 125915	July 31, 1996 125915	July 31, 2006	Titulaire actuel : Porges SAS
PARAGUAY	(I) 10	April 15, 1988	August 27, 1992 19555	October 28, 1999 218915	September16, 2008	Titulaire actuel : Porges SAS
ROYAUME-UNI	(I) 10	January 19, 1993	January 19, 2000 1524362	January 19, 2000 1524362	January , 2010	Titulaire actuel : Porges SAS
SINGAPOUR	(I) 10	May 20, 1985	May 20, 2002 T85/02198C	May 20, 2002 T85/02198C	May , 2012	Titulaire actuel : Porges SAS
SUĖDE	(I) 10	May 31, 1985	December 20, 1995 199.276	December 20, 1995 199.276	December , 2005	Titulaire actuel : Porges SAS
TAIWAN, PROVINCE DE CHINE	(N) 82	June 6, 1985	December 01, 1995 307741	December 01, 1995 307741	November 30, 2005	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		TURQUIE	(I) 10	April 11, 1988	March 27, 1998 17948	April 11, 1998 104070	April 11, 2008	Titulaire actuel : Porges SAS
PROSTAPLEX (Dėnomination)	1
		FRANCE	(I) 10	April 18, 1989	April 18, 1999 1 533 316	April 18, 1999 1 533 316	April 18, 2009	Titulaire actuel : Porges SAS
PYELOSTENT (Dėnomination)	1
		DANEMARK	(I) 10	April 9, 1996	April 09, 1996 VA 02.317 1996	June 07, 1996 VR 03.432 1996	June 7, 2006	Titulaire actuel : Porges SAS
		FINLANDE	(I) 10	April 10, 1996	April 10, 1996 T1996 01828	Septemer 15, 1997 207347	September15, 2007	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	October 26, 1995	October 26, 1995 95594678	October 26, 1995 95594678	October 26, 2005	Titulaire actuel : Porges SAS
		International	(I) 10	April 9, 1996	April 09, 1996 653 966	April 09, 1996 653 966	September04, 2006 September04, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE, BĖLARUS; BENELUX; CHINE; ĖGYPTE; ESPAGNE; HONGRIE; ITALIE, KAZAKHSTAN; KIRGHIZISTAN; MACĖDOINE; MAROC, MONACO; OUZBĖKISTAN; POLOGNE; PORTUGAL; ROUMANIE; RUSSIE, FĖDĖRATION DE; SLOVĖNIE; SUISSE; TADJIKISTAN;
		IRLANDE	(I) 10	April 10, 1996	October 25, 2002 175309	October 25, 2002 175309	October 25, 2012	Titulaire actuel : Porges SAS
		JAPON	(I) 10	April 24, 1996	April 24, 1996 045847	January 16, 1998 4104079	January 16, 2008	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	April 10, 1996	April 10, 1996 1996 2343	October 09, 1997 185690	October 9, 2007	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10	April 15, 1996	April 15, 1996 2068729	November 29, 1996 2068729	April 15, 2006	Titulaire actuel : Porges SAS
		SUĖDE	(I) 10	April 26, 1996	April 26, 1996 96-04408	April 11, 1997 322796	April 11, 2007	Titulaire actuel : Porges SAS
REPATCH (Dėnomination)	1
		FRANCE	(I) 10	August 28, 2003	August 28, 2003 03 3 243 071	January 30, 2004 03 3 243 071	August 28, 2013	Titulaire actuel : Porges SAS
RESURINE (Dėnomination)	1
		FRANCE	(I) 10	July 13, 1976	June 10, 1996 1 363 379	June 10, 1996 1 363 379	June 10, 2006	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		International	(I) 10	June 22, 1978	June 22, 1998 R 438 332	June 22, 1998 R 438 332	June 22, 2008 June 22, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALEMAGNE; AUTRICHE; BENELUX; BULGARIE; CROATIE; ĖGYPTE; ESPAGNE; HONGRIE; ITALIE; MAROC; PORTUGAL; POUMANIE; SLOVAQUIE; SLOVĖNIE; SUISSE; TCHĖQUE, RĖPUBLIQUE, YOUGOSLAVIE
		JAPON	(I) 10	December 28, 1985	November 30, 1998 2094244	November 30, 1998 2094244	November 30, 2008	Titulaire actuel : Porges SAS
		JAPON	(I) 10	March 11, 1986	January 23, 1999 2109670	January 23, 1999 2109670	January 23, 2009	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	June 11, 1985	April 17, 1996 124 894	April 17, 1996 124 894	April 17, 2006	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10	June 14, 1985	June 14, 1992 1243980	June 14, 1992 1243980	June 14, 2006	Titulaire actuel : Porges SAS
SANILIAC (Dėnomination)	1
		International	(I) 10	November 17, 1956	November 17, 1996 2R 196 639	November 17, 1996 2R 196 639	November 17, 2006	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BENELUX; ESPAGNE; ITALIE
SKINFIX (Dėnomination)	1
		DANEMARK	(I) 10	June 21, 1977	Septemer 08, 1998 1978 02966	Septemer 08, 1998 VR 1978 02966	September8, 2008	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	March 12, 1987	March 12, 1997 1 398 222	March 12, 1997 1 398 222	March 12, 2007	Titulaire actuel : Porges SAS
		International	(I) 10	May 27, 1977	May 27, 1997 R 430 940	May , 271997 R 430 940	May 27, 2007	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE (AB); BENELUX; ITALIE
		SUĖDE	(I) 10	November 11, 1977	November 11, 1997 161312	November 11, 1997 161312	November 11, 2007	Titulaire actuel : Porges SAS
SPEC (Dėnomination)	1
		ALLEMAGNE	(I) 10	January 9, 1991	January 09, 2001 2 101 839	January 09, 2001 2 101 839	January 9, 2011	Titulaire actuel : Porges SAS
SPEC - Porges (Dėnomination)	1
		JAPON	(I) 10	December 21, 1995	December 21, 1995 133788/95	Septemer 05, 1997 4054236	September5, 2007	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

SPEC - Porges (Dėnomination)	1
		JAPON	(I) 10	December 21, 1995	December 21, 1995 133789/95	Septemer 05, 1997 4054237	September5, 2007	Titulaire actuel : Porges SAS
SPEC-5 (Dėnomination)	1
		AFRIQUE DU SUD	(I) 10	March 19, 1986	March 19, 1996 86/1649	March 19, 1996 86/1649	March , 2006	Titulaire actuel : Porges SAS
		ARGENTINE	(I) 10	March 25, 1997	March 25, 1997 2074738	October 22, 1999 1 758 046	October 22, 2009	Titulaire actuel : Porges SAS
		BRĖSIL	(N) 05;50	April 10, 1986	February 23, 1998 812502787	February 23, 1998 812502787	February 23, 2008	Titulaire actuel : Porges SAS
		CHINE	(I) 10	May 14, 1986	February 21, 1997 970000420	March 10, 1997 280060	March 9, 2007	Titulaire actuel : Porges SAS
		CORĖE RĖPUBLIQUE DE	(N) 11	May 1, 1986	June 02, 1997 97-3048	February 25, 1998 141204	June 2, 2007	Titulaire actuel : Porges SAS
		CORĖE RĖPUBLIQUE DE	(I) 10	May 1, 1986	June 02, 1997 97-3049	February 25, 1998 141205	June 2, 2007	Titulaire actuel : Porges SAS
		DANEMARK	(I) 10	February 17, 1986	May 18, 1997 1963 1987	May 18, 1997 1963 1987	May 18, 2007	Titulaire actuel : Porges SAS
		ĖTATS-UNIS	(I) 10	October 15, 1985	October 15, 1985 563 267	August 19, 1986 1,405,666	August 19, 2006	Titulaire actuel : Porges SAS
		FINLANDE	(I) 10	February 20, 1986	August 31, 1998 R199803256	Septemer 20, 1998 102343	September, 2008	Titulaire actuel : Porges SAS
		GRĖCE	(I) 10	February 26, 1986	February 26, 1996 81 960	February 26, 1996 81 960	February 26, 2006	Titulaire actuel : Porges SAS
		INDONĖSIE	(I) 10	February 27, 1986	November 29, 1995 D95 22627	November 20, 1996 374071	September26, 2006	Titulaire actuel : Porges SAS
		MALAISIE	(I) 10	February 25, 1986	February 25, 1993 86/00729	November 06, 1995 86/00729	February 25, 2007	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	February 18, 1986	March 19, 1997 128 146	March 19, 1996 128 146	March , 2007	Titulaire actuel : Porges SAS
		SUĖDE	(I) 10	April 22, 1986	March 11, 1998 209473	March 11, 1998 209473	March 11, 2008	Titulaire actuel : Porges SAS

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Page 76 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		TAIWAN, PROVINCE DE CHINE	(N) 82	May 14, 1986	December 15, 1996 350369	December 15, 1996 350369	December 15, 2006	Titulaire actuel : Porges SAS
STENOSTENT (Dėnomination)	1
		DANEMARK	(I) 10	April 9, 1996	April 09, 1996 2318/96	June 07, 1996 VR 3433	June 7, 2006	Titulaire actuel : Porges SAS
		FINLANDE	(I) 10	April 10, 1996	April 10, 1996 1829/96	Septemer 15, 1997 207348	September15, 2007	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	October 26, 1995	October 26, 1995 95 594 679	October 26, 1995 95 594 679	October 26, 2005	Titulaire actuel : Porges SAS
		International	(I) 10	April 9, 1996	April 09, 1996 653 967	April 09, 1996 653 967	September04, 2006 September04, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BĖLARUS; BENELUX; CHINE, ĖGYPTE; ESPAGNE; HONGRIE; ITALIE; KAZAKHSTAN; KIRGHIZISTAN; MACĖDOINE; MAROC; MONACO; OUZBĖKISTAN; POLOGNE; PORTUGAL; ROUMANIE; RUSSIE; FĖDĖRATION DE; SOVAQUIE; SUISSE; TADJIKISTAN
		IRLANDE	(I) 10	April 10, 1996	October 25, 2002 175310	October 25, 2002 175310	October 25, 2012	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	April 10, 1996	April 10, 1996 962344	October 09, 1997 185 691	October 9, 2007	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10	April 17, 1996	April 17, 1996 2068998	December 06, 1996 2068998	April 17, 2006	Titulaire actuel : Porges SAS
		SUĖDE	(I) 10	April 26, 1996	April 26, 1996 96-04407	August 22, 1997 324449	August 22, 2007	Titulaire actuel : Porges SAS
STERILIC (Dėnomination)	1
		FRANCE	(I) 5; 10; 17	September 28, 1961	July 17, 1996 1 363 806	July 17, 1996 1 363 806	July 17, 2006	Titulaire actuel : Porges SAS
SUPRAFLOW (Dėnomination)	1
		FRANCE	(I) 10	December 18, 1997	December 18, 1997 97 709 516	December 18, 1997 97 709 516	December 18, 2007	Titulaire actuel : Porges SAS
		GRĖCE	(I) 10	June 17, 1998	June 17, 1998 137 238	June 19, 2000 137 238	June 17, 2008	Titulaire actuel : Porges SAS

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Page 77 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		International	(I) 10	June 16, 1998	June 16, 1998 694 345	June 16, 1998 694 345	June 16, 2008 June 16, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; DANEMARK; ESPAGNE; FINLANDE; ITALIE; NORVĖGE; PORTUGAL; ROYAUME-UNI; SUĖDE
		IRLANDE	(I) 10	June 16, 1998	June 16, 1998 98/2528	June 16, 1998 213772	June 15, 2008	Titulaire actuel : Porges SAS
SYMPHONY (Dėnomination)	2
		ALLEMAGNE	(I) 10	December 2, 1986	December 02, 1996 1 107 867	December 02, 1996 1 107 867	December 2, 2006	Titulaire actuel : Porges SAS
T.O.B. (Dėnomination)	1
		ALLEMAGNE	(I) 10	March 26, 2004	March 26, 2004 304 17 902. 7/10	December 02, 2004 304 17 902	March 26, 2014	Titulaire actuel : Porges GmbH
T.O.T. (Dėnomination)	1
		AFRIQUE DU SUD	(I) 10	October 28, 2003	October 28, 2003 2003/18867			Titulaire actuel : Porges SAS
		ARABIE SAOUDITE	(I) 10	October 28, 2003	October 28, 2003 85979			Titulaire actuel : Porges SAS
		CANADA	(I) 10	October 27, 2003	October 27, 2003 1194254	January 06, 2005 629 549	January 6, 2020	Titulaire actuel : Porges SAS
		ĖMIRATS ARABES UNIS	(I) 10	February 15, 2003	February 15, 2003		- N -	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	April 28, 2003	April 28, 2003 03 3 222 774	April 28, 2003 03 3 222 774	April 28, 2013	Titulaire actuel : Porges SAS
		HONG-KONG	(I) 10	October 28, 2003	October 28, 2003 300101690	March 04, 2005 300101690	October 27, 2013	Titulaire actuel : Porges SAS
		INDE	(I) 10	October 28, 2003	October 28, 2003 01246405			Titulaire actuel : Porges SAS
		International	(I) 10	October 28, 2003	October 28, 2003 818 272	October 28, 2003 818 272	October 28, 2008 October 28, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; CHINE; CORĖE, RĖPUBLIQUE DE; CORĖE, RĖPUBLIQUE POPULAIRE DĖMOCRATIQUE DE (AB); DANEMARK; ESPAGNE; FINLINDE; GRĖCE; HONGRIE; IRLANDE,ITALIE; JAPON; POLOGNE; PORTUGAL; ROYAUME-UNI; SINGAPOUR (AB), SUĖDE; TCH

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Page 78 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		ISRAĖL	(I) 10	October 27, 2003	October 28, 2003 167583	December 05, 2004 167583	October 27, 2013	Titulaire actuel : Porges SAS
		KOWEIT	(I) 10	October 28, 2003	October 28, 2003 61576			Titulaire actuel : Porges SAS
		QATAR	(I) 10	October 28, 2003	October 28, 2003 30875			Titulaire actuel : Porges SAS
		TAIWAN, PROVINCE DE CHINE	(I) 10	October 28, 2003	October 28, 2003 92062918	July 16, 2004 1111086	July 15, 2007	Titulaire actuel : Porges SAS
TOILE D'ARAIGNEE (Graphisme)	1
		International	(I) 9; 10	September 16, 1991	Septemer 16, 1991 575 756 5	Septemer 16, 1991 575 756 5	September 13, 2006 September 16, 2001 September 16, 2011	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BENELUX; BULGARIE; CROATIE; ĖGYPTE; ESPAGNE; HONGRIE; ITALIE; MAROC; PORTUGAL; ROUMANIE; SLOVAQUIE; SLOVĖNIE, SUISSE; TCHĖQUE, RĖPUBLICQUE; YOUGOSLAVIE
TOP-WINDER (Dėnomination)	1
		FRANCE	(I) 10	April 2, 1999	April 02, 1999 99 784 440	April 02, 1999 99 784 440	April 2, 2009	Titulaire actuel : Porges SAS
U2 (Dėnomination)	1
		International	(I) 10	April 13, 1995	April 13, 1995 634 307	April 13, 1995 634 307	April 13, 2015	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE (AB); BENELUX; ESPAGNE; ITALIE, PORTUGAL (AB); SUISSE
		IRLANDE	(I) 10	February 16, 1995	November 08, 2001 167141	November 08, 2001 167141	November 8, 2011	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	February 7, 1995	February 07, 1995 950789	June 20, 1996 174 451	June , 2006	Titulaire actuel : Porges SAS
U2 Porges (Dėnomination)	1
		AUTRICHE	(I) 10	July 25, 1996	July 25, 1996 AM 4087/96	January 10, 1997 167/660	January 10, 2007	Titulaire actuel : Porges SAS
		DANEMARK	(I) 10	September 2, 1997	Septemer 02, 1997 4290/97	Septemer 26, 1997 VR 4014	September26, 2007	Titulaire actuel : Porges SAS

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Page 79 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		ROYAUME-UNI	(I) 10	February 13, 1996	February 13, 1996 2056808	Septemer 27, 1996 2056808	February 13, 2006	Titulaire actuel : Porges SAS
		SUĖDE	(I) 10	February 12, 1996	February 12, 1996 96-1572	Septemer 20, 1996 317368	September, 2006	Titulaire actuel : Porges SAS
URETHROSPIRAL (Dėnomination)	1
		FRANCE	(I) 10	September 16, 1991	Septemer 16, 2001 1 693 224	Septemer 16, 2001 1 693 224	September16, 2011	Titulaire actuel : Porges SAS
		International	(I) 10	March 12, 1992	March 12, 1992 583 198	March 12, 1992 583 198	December 03, 2007 December 03, 2012	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; BULGARIE; CROATIE; ESPAGNE; HONGRIE; ITALIE; MACĖDOINE, POLOGNE; PORTUGAL; ROUMANIE; SLOVAQUIE; SLOVĖNIE; SUISSE; TCHĖQUE; RĖPUBLIQUE, YOUGOSLAVIE
		JAPON	(I) 10	April 11, 1995	April 11, 1995 036425/95	November 21, 1997 336047	November 21, 2007	Titulaire actuel : Porges SAS
URIDROP (Dėnomination)	1
		FRANCE	(I) 10	July 11, 1978	July 04, 1998 1 474 527	July 04, 1998 1 474 527	July 4, 2008	Titulaire actuel : Porges SAS
		International	(I) 10	September 28, 1978	Septemer 28, 1998 R 440 484	Septemer 28, 1998 R 440 484	September28, 2008	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; BENELUX; ESPAGNE; ITALIE
URIOPE (Dėnomination)	1
		ALLEMAGNE	(I) 10	January 25, 1999	January 25, 1999 39904329.2	April 26, 1999 399 04 329	January 31, 2003	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	January 25, 1999	January 25, 1999 99 770 851	January 25, 1999 99 770 851	January 25, 2009	Titulaire actuel : Porges SAS
URISTIL (Dėnomination)	1
		ĖTATS-UNIS	(I) 10		July 24, 2001 76-290 079	October 08, 2002 2 631 106	August 10, 2008 August 10, 2012	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	September 13, 1973	July 25, 2003 1 248 893	July 25, 2003 1 248 893	July 25, 2013	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		International	(I) 10	December 4, 1973	December 04, 1993 R 403 756	December 04, 1993 R 403 756	April 12, 2008 April 12, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BENELUX; BULGARIE; CROATIE; ĖGYPTE; ESPAGNE, HONGRIE; ITALIE; MAROC; PORTUGAL; ROUMANIE; SLOVAQUIE; SLOVĖNIE, SUISSE; TCHĖQUE, RĖPUBLIQUE; YOUGOSLAVIE
		JAPON	(I) 10	April 17, 1980	October 26, 1998 2088750	October 26, 1998 2088750	October 26, 2008	Titulaire actuel : Porges SAS
		NORVĖGE	(I) 10	July 12, 1985	April 09, 1997 128 281	April 09, 1997 128 281	April 9, 2007	Titulaire actuel : Porges SAS
		ROYAUME-UNI	(I) 10	June 14, 1985	June 14, 1992 1243983	June 14, 1992 1243983	June 14, 2006	Titulaire actuel : Porges SAS
URISTON (Dėnomination)	1
		FRANCE	(I) 10	April 18, 1994	February 06, 2004 94 515 924	February 06, 2004 94 515 924	April 18, 2014	Titulaire actuel : Porges SAS
		International	(I) 10	December 23, 1994	December 23, 1994 629 285	December 23, 1994 629 285	December 23, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; ESPAGNE (AB); ITALIE
UROCARE (Dėnomination)	1
		ALLEMAGNE	(I) 10	August 17, 1979	August 17, 1999 1 005 202	August 17, 1999 1 005 202	August 17, 2009	Titulaire actuel : Porges GmbH
		International	(I) 10	August 11, 1980	August 11, 2000 R 454 440	August 11, 2000 R 454 440	August 11, 2010	Titulaire actuel : Porges GmbH	Pays revendiqués : ALLEMAGNE; AUTRICHE
urocare supra (Dėnomination)	1
		ALLEMAGNE	(I) 5;10	January 16, 2002	January 16, 2002 302 02 286	October 28, 2002 302 02 286	January 16, 2012	Titulaire actuel : Porges GmbH
UROCATH (Dėnomination)	1
		FRANCE	(I) 10	July 29, 1993	July 29, 2003 93 478 391	July 29, 2003 93 478 391	July 29, 2013	Titulaire actuel : Porges SAS
		International	(I) 10	December 30, 1993	December 30, 1993 612 231	December 30, 1993 612 231	December 30, 2008 December 30, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; ESPAGNE; ITALIE; POLOGNE; PORTUGAL; SUISSE

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Page 81 of 179

TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

		ROYAUME-UNI	(I) 10	September 28, 1993	July 29, 2000 1548809	July 29, 2000 1548809	July 29, 2010	Titulaire actuel : Porges SAS
UROFOLEY (Dėnomination)	1
		FRANCE	(I) 10	February 8, 1993	February 08, 2003 93 454 179	February 08, 2003 93 454 179	February 8, 2013	Titulaire actuel : Porges SAS
		International	(I) 10	September 7, 1993	Septemer 07, 1993 606 282	Septemer 07, 1993 606 282	July 09, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE, AUTRICHE; BENELUX; ESPAGNE, HONRIE; ITALIE; POLOGNE; PORTUGAL (AB), SLOVAQUIE; SLOVĖNIE; SUISSE (AB); TCHĖQUE; RĖPUBLIQUE
		ROYAUME-UNI	(I) 10	September 28, 1993	Septemer 28, 2000 1548826	Septemer 28, 2000 1548826	September28, 2010	Titulaire actuel : Porges SAS
UROQUICK (Dėnomination)	1
		FRANCE	(I) 10	June 1, 1999	June 01, 1999 99 794 930	June 01, 1999 99 794 930	June 1, 2009	Titulaire actuel : Porges SAS
UROSPIRAL (Dėnomination)	1
		ĖTATS-UNIS	(I) 10	September 1, 1999	Septemer 01, 1999 75-791 320	June 20, 2000 2,360,341	June 20, 2006 June 20, 2010	Titulaire actuel : Porges SAS
		FRANCE	(I) 10	September 16, 1991	Septemer 16, 2001 1 693 223	Septemer 16, 2001 1 693 223	September16, 2011	Titulaire actuel : Porges SAS
		International	(I) 10	March 12, 1992	March 12, 1992 583 197	March 12, 1992 583 197	December 03, 2007 December 03, 2012	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BENELUX; BULGARIE; CROATIE; ĖGYPTE; ESPAGNE; HONGRIE; ITALIE; MACĖDOINE; MAROC; POLOGNE; PORTUGAL; ROUMANIE; RUSSIE; FĖDĖRATION DE; SLOVAQUIE; SLOVĖNIE; SUISSE; TCHĖQUE; RĖPUBLIQUE; YOUGOSLAVIE
		ROYAUME-UNI	(I) 10	March 17, 1992	March 17, 1999 A 1 494 610	March 17, 1999 A 1 494 610	March 17, 2009	Titulaire actuel : Porges SAS
UROSPIRAL Porges (Dėnomination)	1
		JAPON	(I) 10	March 20, 1995	March 20, 1995 027233/95	July 11, 1997 3331673	July 11, 2007	Titulaire actuel : Porges SAS
UROSPIRALE (Dėnomination)	1
		FRANCE	(I) 10	August 6, 1991	August 06, 2001 1 685 275	August 06, 2001 1 685 275	August 6, 2011	Titulaire actuel : Porges SAS

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TRADEMARK 1st Application Application - date & number Registration - date & number Valid through Owner of the trademark Claimed countries

UROTRAY (Dėnomination)	1
		FRANCE	(I) 10	September 13, 1973	July 25, 2003 1 248 894	July 25, 2003 1 248 894	July 25, 2013	Titulaire actuel : Porges SAS
		International	(I) 10	December 4, 1973	December 04, 1993 R 403 757	December 04, 1993 R 403 757	April 12, 2008 April 12, 2013	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BENELUX; ESPAGNE; ITALIE; PORTUGAL; SUISSE
		JAPON	(I) 10	July 29, 1993	July 29, 1993 080427/93	May 31, 1996 3156741	May 31, 2006	Titulaire actuel : Porges SAS
VIPER (Dėnomination)	1
		FRANCE	(I) 10	February 10, 1999	February 10, 1999 99 774 222	February 10, 1999 99 774 222	February 10, 2009	Titulaire actuel : Porges SAS
		International	(I) 10	August 6, 1999	August 06, 1999 718 239	August 06, 1999 718 239	June 08, 2009 June 08, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; DANEMARK; ESPAGNE; ITALIE, NORVĖGE; PORTUGAL; ROYAUME-UNI; SUĖDE; SUISSE; TURQUIE
VORTEK (Dėnomination)	1
		FRANCE	(I) 10; 17	November 2, 1995	November 02, 1995 95 595 822	November 02, 1995 95 595 822	November 2, 2005	Titulaire actuel : Porges SAS
		International	(I) 10; 17	March 28, 1996	March 28, 1996 660 113	March 28, 1996 660 113	March 28, 2006 March 28, 2016	Titulaire actuel : Porges SAS	Pays revendiqués : ALGĖRIE; ALLEMAGNE; AUTRICHE; BĖLARUS; BENELUX; CHINE; CHINE (AB); ĖGYPTE; ESPAGNE; HONGRIE, ITALIE; KAZAKHSTAN; KIRGHIZISTAN; MACĖDOINE; MAROC; MONACO; OUZBĖKISTAN; POLOGNE; PORTUGAL; ROUMANIE (AB); RUSSIE, FĖDĖRATION DE; SOVAQUIE; SU
X-FLOW (Dėnomination)	1
		FRANCE	(I) 10	July 21, 2003	July 21, 2003 03 3 237 441	July 21, 2003 03 3 237 441	July 21, 2013	Titulaire actuel : Porges SAS
		International	(I) 10	January 20, 2004	January 20, 2004 818 431	January 20, 2004 818 431	January 20, 2009 January 20, 2014	Titulaire actuel : Porges SAS	Pays revendiqués : ALLEMAGNE; AUTRICHE; BENELUX; DANEMARK; ESPAGNE; FINLANDE; GRĖCE; IRLANDE; ITALIE; JAPON; MAROC; PORTUGAL; ROYAUME-UNI; SUĖDE

Each other Seller trademark and registration related thereto that are used exclusively for MECs anywhere in the world.

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Schedule 1.181(b)

Non-Transferred Marks

Mentor Aesthetic Licensed Trademarks

Trademark	Reg. Number	Country	Registration Date	Class	Renewal	Licensor
CAROMED	1,653,578	US	8/13/1991	10	8/13/2011	Caromed

Application No.	Trademark	Country	Application Date	Status	Licensor
	BACCARI	US		T-Unregistered	Baccari
	COLEMAN	US		T-Unregistered	Lipostructore/Coleman
	HUNSTAD	US		T-Unregistered	Hunstad
	MLADICK	US		T-Unregistered	Mladick
	PAUL	US		T-Unregistered	Paul
78/140,547	PURTOX	US	7/2/2002	Pending	WHARF/BRTA

Mentor Corporate and Aesthetic Trademark Applications and Unregistered Marks Worldwide

Application No. Trademark Country Application Date Status

	ALL COHESIVE, ALL THE TIME and Logo	CTM		Pending
98/765,597	BYRON	France	12/22/1998	Pending
	COHESIVE I	US		T-Unregistered
	COHESIVE II	US		T-Unregistered
	COHESIVE III	US		T-Unregistered
98/765,598	COLEMAN	France	12/22/1998	Pending
78/579,506	CPG	US	3/3/2005	Pending
78/579,496	DXL	US	3/3/2005	Pending
78/638,506	DXL and Design	US	5/26/2005	Pending
2601539	DXL	Argentina	7/4/2005	Pending
1062072	DXL	Australia	6/27/2005	Pending
827544138	DXL	Brazil	6/29/2005	Pending
1262855	DXL	Canada	6/28/2005	Pending
4754736	DXL	China		Pending
2005-066396	DXL	Colombia	7/6/2005	Pending
4465498	DXL	CTM	6/27/2005	Pending
181799	DXL	Israel	6/29/2005	Pending
2005-74790	DXL	Japan	8/10/2005	Pending
2005-35397	DXL	Korea	7/27/2005	Pending
725553	DXL	Mexico	6/28/2005	Pending
731788	DXL	New Zealand	6/28/2005	Pending

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Application No. Trademark Country Application Date Status

2005 06210	DXL	Norway	6/28/2005	Pending
65719	DXL	Puerto Rico	7/15/2005	Pending
T05/12007F	DXL	Singapore	7/12/2005	Pending
2005-12845	DXL	South Africa	6/28/2005	Pending
94031145	DXL	Taiwan	6/29/2005	Pending
599228	DXL and Design	Thailand	8/5/2005	Pending
2005-017254	DXL	Venezuela	8/9/2005	Pending
826230768	ELITE	Brazil	1/28/2004	Pending
1204707	ELITE	Canada	1/30/2004	Pending
639368	ELITE	Mexico		Pending
76/539,076	ELITE	US	8/6/2003	Pending
78/604,265	E-Z FILL	US	4/7/2005	Pending
	INCONFORMANCE	US		T-Unregistered
	LUMERA	US		T-Unregistered
872,967	Mentor ACCU-DX	Canada	3/23/1998	Pending
2,094	Mentor ACCU-DX	Phillipines	3/24/1998	Pending
78/378,664	MEMORY GEL	US	3/4/2004	Pending
1019190	MEMORYGEL	Australia	9/6/2004	Pending
1229036	MEMORYGEL	Canada	9/1/2004	Pending
4004768	MEMORYGEL	CTM	9/1/2004	Pending
2004-104	Mentor	Korea	1/2/2004	Pending
	PSI-TEC	US		T-Unregistered
2,601,537	PURA	Argentina	7/4/2005	Pending
827544111	PURA	Brazil	6/29/2005	Pending
1247897	PURA	Canada	2/21/2005	Pending
78/515,688	PURACEL	US	11/11/2004	Pending
4754738	PURA	China		Pending
2005-066394	PURA	Colombia	7/6/2005	Pending
4275939	PURA	CTM	7/3/2005	Pending
78/638,304	PURA (DESIGN)	US	5/26/2005	Pending
78/515,673	PURAFEX	US	11/11/2004	Pending
1245493	PURAFIL	Canada	1/31/2005	Pending
4204351	PURAFIL	CTM	1/30/2005	Pending
78/528,674	PURAGEN	US	12/7/2004	Pending
78/638,331	PURAGEN and Design	US	5/26/2005	Pending
2595619	PURAGEN	Argentina	6/6/2005	Pending
827486499	PURAGEN	Brazil	6/6/2005	Pending
1,246,867	PURAGEN	Canada	2/11/2005	Pending
4705914	PURAGEN	China	6/7/2005	Pending
5054915	PURAGEN	Colombia	6/7/2005	Pending
52703/2005	PURAGEN	CTM	2/11/2005	Pending
181209	PURAGEN	Israel	6/5/2005	Pending
2005-25471	PURAGEN	Korea	6/3/2005	Pending
721104	PURAGEN	Mexico	6/3/2005	Pending
730803	PURAGEN	New Zealand	6/7/2005	Pending
200503096	PURAGEN	Norway	4/5/2005	Pending

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Application No. Trademark Country Application Date Status

78/562,288	PURAGEN PLUS	US	2/7/2005	Pending
78/628,488	PURAGEN PLUS and Design	US	5/26/2005	Pending
65446	PURAGEN	Puerto Rico	6/14/2005	Pending
t05/09358j	PURAGEN	Singapore	6/6/2005	Pending
2005/10928	PURAGEN	South Africa	6/3/2005	Pending
94026724	PURAGEN	Taiwan	6/6/2005	Pending
592523	PURAGEN	Thailand	6/7/2005	Pending
2005-012177	PURAGEN	Venezuela	6/6/2005	Pending
78/515,691	PURA	US	11/11/2004	Pending
181797	PURA	Israel	6/29/2005	Pending
2005-30779	PURA	Japan	4/7/2005	Pending
2005-35398	PURA	Korea	7/27/2005	Pending
78/515,682	PURALLURE	US	11/11/2004	Pending
725554	PURA	Mexico	6/28/2005	Pending
731787	PURA	New Zealand	6/28/2005	Pending
200503094	PURA	Norway	4/5/2005	Pending
1247896	PURA PLUS	Canada	2/21/2005	Pending
78/565,065	PURA PLUS	US	2/10/2005	Pending
65718	PURA	Puerto Rico	7/15/2005	Pending
t05/12005z	PURA	Singapore	7/12/2005	Pending
2005-12843	PURA	South Africa	6/28/2005	Pending
94031141	PURA	Taiwan	6/29/2005	Pending
595021	PURA	Thailand	6/30/2005	Pending
78/565,058	PURA	US	2/10/2005	Pending
2005-017253	PURA	Venezuela	8/9/2005	Pending
78/613,289	PURE REGENERATION FOR SKIN	US	4/19/2005	Pending
1262473	PURE REGENERATION FOR SKIN	Canada	6/27/2005	Pending
	THE DETECTOR	US		T-Unregistered
76/548,461	THE POWER TO TRANSFORM	US	10/2/2003	Pending
76/548,432	THE POWER TO TRANSFORM (Design)	US	10/2/2003	Pending
	THE RIGHT PROFILE FOR YOU			T-Unregistered
4287281	ULTRASCULPT	CTM	3/10/2005	Pending
78/580,826	ULTRASCULPT	US	3/4/2005	Pending

Mentor Corporate and Aesthetic Worldwide Trademark Registrations

Trademark Reg. Number Country Registration Date Renewal

BUFFERZONE	2,818,049	US	2/24/2004	2/24/2014
BYRON MEDICAL	2,187,523	United Kingdom	2/1/1999	2/1/2009
BYRON MEDICAL	39,905,375	Germany	5/11/1999	2/1/2009
BYRON MEDICAL	646,780	Benelux	2/1/1999	2/1/2009
BYRON MEDICAL	784297	Australia	10/13/2000	2/1/2009
BYRON MEDICAL	TMA 543,100	Canada	3/27/2001	3/27/2016

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Trademark Reg. Number Country Registration Date Renewal

BYRON MEDICAL	2,211,863	Spain	2/8/2001	2/2/2009
BYRON	2,183,856	Spain
CENTERSCOPE	2,744,463	US	7/29/2003	7/29/2013
COLEMAN	2,211,862	Spain	3/6/2000	2/4/2009
COLEMAN	39,905,378	Germany	5/11/1999	2/1/2009
COLEMAN	646,781	Benelux	2/1/1999	2/1/2009
COLEMAN	784,298	Australia	3/5/2001	2/1/2009
COLEMAN	571,645	Canada	12/4/2002	12/4/2017
COLEMAN & Design	2,190,855	United Kingdom	3/4/1999	3/4/2009
CONTOUR GENESIS	731244	Australia	3/20/1998	4/1/2007
CONTOUR GENESIS		Canada	5/22/2003	5/22/2018
CONTOUR GENESIS	487,918	CTM-Community Trademark	7/16/2001	3/12/2007
CONTOUR GENESIS	2,155,701	US	5/8/1998	5/8/2008
CONTOUR PROFILE	18,754	CTM-Community Trademark	1/27/1998	4/1/2006
CONTOUR PROFILE	2,073,144	US	6/24/1997	6/24/2007
DXL	537142	Switzerland	8/29/2005	6/27/2015
ELITE	986,491	Australia	11/22/2004	1/28/2014
ELITE	3612413	Europe	6/22/2005	1/29/2014
INFORM & CONSENT	1,919,458	US	9/19/1995	9/19/2015
INFORM&ENHANCE	2,567,537	US	5/7/2002	5/7/2012
L and Design	2,280,449	US	9/28/1999	9/28/2009
LIPOSONIQUE	1, 709, 158	Spain	5/5/1995	6/24/2002
LIVING LONGER, AGING GRACEFULLY	2,519,283	US	12/18/2001	12/18/2011
LYSONIX	629,814	Canada	1/10/2005	1/10/2020
LYSONIX	519,108	Chile	8/10/1998	8/8/2008
LYSONIX	256,353	Colombia	10/4/2002	10/4/2012
LYSONIX	3392421	CTM-Community Trademark	3/2/2005	10/7/2013
LYSONIX	4,318,398	Japan	9/24/1999	9/24/2009
LYSONIX	569,929	Mexico	1/30/1998	1/14/2008
LYSONIX	2,256,640	US	6/29/1999	6/29/2009
LYSONIX	433V4P45	Venezuela	9/10/1999	9/10/2009
Mentor	1,349,105	US	7/16/1985	7/16/2015
Mentor	1,853,450	US	9/13/1994	9/13/2014
Mentor	2,069,724	Germany	7/1/1994	4/30/2031
Mentor	559,327	Mexico	9/26/1997	7/20/2007
Mentor	565,011	Mexico	11/27/1997	7/10/2007
Mentor	93/464,118	France	4/15/1993	4/15/2013
MENTOR CLEAR ADVANTAGE	1,494,286	UK
Mentor Logo	269,157	Colombia	5/31/2002	5/30/2012
Mentor and Logo	2,026,931	Spain	6/20/1997	5/3/2006
Mentor and Logo	2,026,932	Spain	6/20/1997	5/3/2006
Mentor	641,528	Chile	9/6/2002	9/6/2012
Mentor	279,983	Colombia	11/22/2002	11/21/2012
Mentor	1,531,850	United Kingdom	4/5/1993	4/5/2010
Mentor	464,690	Canada	10/25/1996	10/25/2011
Mentor Logo	1,531,928	United Kingdom	4/5/1993	4/5/2010

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Trademark Reg. Number Country Registration Date Renewal

Mentor Logo	1,853,451	US	9/13/1994	9/13/2014
Mentor Logo	93/464,119	France	4/15/1993	4/15/2013
Mentor Logo	285,767	Colombia	8/29/2004	8/8/2014
Mentor Logo	2,060,649	Germany	3/24/1994	4/7/2013
Mentor Logo	TMA464,686	Canada	10/25/1996	10/25/2011
Mentor	1,472,797	US	1/19/1988	1/19/2008
Mentor	A258,202	Australia	5/3/1972	5/3/2007
Mentor	A267,328	Australia	5/3/1972	5/3/2007
Mentor	B975,240	United Kingdom	5/21/1971	5/21/2006
Mentor	B975,241	United Kingdom	5/21/1971	5/21/2006
Mentor	301,868	Benelux	4/26/1981	4/26/2011
Mentor	6150071	Brazil	10/25/1975	10/25/2005
Mentor	61,872	Greece	8/30/1988	8/30/2008
Mentor	280,136	India	5/12/1986	5/12/2007
Mentor	380,978	Madrid-Madrid Protocol	8/27/1971	8/27/2011
Mentor	46,843	Israel	11/14/1978	11/14/2013
Mentor	15,385	Panama	11/9/1981	11/9/2011
Mentor	21,847	Puerto Rico	6/27/1989	6/27/2009
Mentor	22,275	Puerto Rico	6/27/1989	6/27/2009
Mentor	71/1164	South Africa	3/22/1991	3/22/2011
Mentor	1,258,594	Spain	9/28/1992	9/28/2012
Mentor	136,980	Sweden	10/22/1971	10/22/2011
Mentor	TMA401,317	Canada	8/14/1992	8/14/2007
Mentor	69,508-F	Venezuela	7/19/1987	7/19/2017
Mentor	276,502	Russia	10/11/2004	11/24/2013
Mentor	1,941,391	US	12/12/1995	12/12/2005
Mentor Logo	1,941,392	US	12/12/1995	12/12/2005
Mentor	2,029,879	UK	8/9/1995	8/9/2015
Mentor	1,454,092	US	8/25/1997	8/25/2007
Mentor PLUS	1,543,390	US	6/13/1989	6/13/2009
Mentor ACCU-DX	758,768	Australia	9/11/1998	4/2/2008
Mentor ACCU-DX	820,641,634	Brazil	6/7/2005	6/7/2015
Mentor ACCU-DX	780,148	CTM-Community Trademark	6/22/1999	3/20/2008
Mentor ACCU-DX	446,641	Korea	4/21/1999	4/21/2009
Mentor ACCU-DX	43,051	Puerto Rico	5/14/1998	5/14/2008
Mentor ACCU-DX	851,120	Taiwan	5/16/1999	5/15/2009
PATHWAY	487,959	CTM-Community Trademark	11/3/1998	3/12/2007
PATHWAY	731,245	Australia	10/14/1997	4/1/2007
PATHWAY	2,201,942	US	11/3/1998	11/3/2008
PURA	1048862	Australia	9/19/2005	4/1/2015
PURAGEN	1,048,861	Australia	8/8/2005	4/1/2015
PURAGEN	4,885,358	Japan	8/5/2005	8/5/2015
PURAGEN	535,206	Switzerland	6/30/2005	4/4/2015
PURA	535,205	Switzerland	6/30/2005	4/4/2015
SILTEX	1,502,078	US	8/30/1988	8/30/2008
SILTEX PROTESIS	2,026,929	Spain	6/20/1997	5/3/2006
SILTEX SPECTRUM	1,527,094	United Kingdom	2/16/1993	2/16/2010
SILTEX SPECTRUM	2,104,312	Germany	11/17/1997	2/28/2013

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Trademark Reg. Number Country Registration Date Renewal

SILTEX SPECTRUM	963,819	CTM-Community Trademark	3/9/2000	10/22/2008
SILTEX SPECTRUM	A599,121	Australia	3/30/1993	3/30/2010
SILTEX SPECTRUM	TMA 482,837	Canada	9/23/1997	9/23/2012
SPECTRUM PROTESIS	2,026,928	Spain	6/20/1997	5/3/2006
SPECTRUM	2,447,313	US	5/1/2001	5/1/2011
SYNERGEL	825976	CTM-Community Trademark	10/22/1999	5/15/2008
TOPIFOAM	2,242,059	US	4/27/1999	4/27/2009
TRUE-LOCK	1,622,318	US	11/13/1990	11/12/2010

Mentor Urology Worldwide Trademark Registrations (Porges listed separately)

Trademark	Reg. Number	Country	Registration Date	Owner
OBTAPE (ABISS)	618,764	Canada	September 7, 2004	Analytic Biosurgical Solutions- ABISS
OBTAPE	705,236	Chile	October 6, 2004	Mentor Corporation
OBTAPE	3,333,267	CTM-Community Trademark	March 31, 2005	Mentor Corporation
OBTAPE	829,372	Mexico	April 14, 2004	Mentor Corporation
OBTAPE	2,893,776	US	October 12, 2004	Mentor Corporation

Mentor Urology Trademark Applications

Trademark	Application No.	Country	Application Date	Status	Owner
OBTAPE	2502479	Argentina	March 23, 2004	Pending	Mentor Corporation
OBTAPE	826332480	Brazil	March 19, 2004	Pending	Mentor Corporation
OBTAPE TOT	76/524,280	US	June 13, 2003	Pending	Mentor Corporation

Porges Trademarks

TRADEMARK				1st Application	Application - date & number	Registration - date & number	Valid through	Owner of the trademark	Claimed countries
OBTAPE (Dėnomination)	1
		FRANCE	(I) 10	September 12, 2002	September 12, 2002 02 3 183 132	Septemer 12, 2002 02 3 183 132	September12, 2012	Titulaire actuel : Porges
		International	(I) 10	March 7, 2003	March 07, 2003 800 740	March 07, 2003 800 740	July 03, 2008 July 03, 2013	Titulaire actuel : Porges	Pays revendiqués : ALLEMAGNE ; AUTRICHE ; BENELUX ; CHINE ; DANEMARK ; ESPAGNE ; FINLANDE ; GRĖCE ; IRLANDE ; ITALIE ; JAPON ; PORTUGAL ; ROYAUME-UNI ; SUĖDE

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Schedule 1.182

Transferred Patents

Worldwide Patents and Patent Apps

Country Status Title Filed Serialno Issued Patent No Owner

US	Issued	PRESSURE RESPONSIVE LOCK-OUT VALVE AND METHOD OF USE	July 29, 1996	08/681,859	December 22, 1998	5,851,176	Mentor Corporation
US	Issued	PRESSURE RESPONSIVE LOCK-OUT VALVE AND METHOD OF USE	November 12, 1998	09/191,401	January 9, 2001	6,171,233	Mentor Corporation
AUSTRIA	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
AUSTRALIA	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	38,960/97	December 21, 2000	723783	Mentor Corporation
BELGIUM	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
CANADA	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	2261266	October 19, 2004	2261266	Mentor Corporation
SWITZERLAND	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
GERMANY	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
DENMARK	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
EPO	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
EPO	Published	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	04021685.5			Mentor Corporation
SPAIN	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation

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Country Status Title Filed Serialno Issued Patent No Owner

FRANCE	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
UK	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
ITALY	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
LUXEMBOURG	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
NETHERLANDS	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
SWEDEN	Issued	PRESSURE-RESPONSIVE LOCKOUT VALVE AND METHOD OF USE	July 28, 1997	97936243.1	September 29, 2004	0920288	Mentor Corporation
US	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 4, 1994	08/207,023	May 9, 2000	6,060,639	Mentor Corporation
US	Issued	METHOD FOR PROVIDING A PROSTHESIS WITH AN INJECTION PORT	May 26, 1995	08/452,007	September 24, 1996	5,558,829	Mentor Corporation
US	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	July 10, 1995	08/452,006	August 5, 1997	5,653,757	Mentor Corporation
US	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	May 26, 1995	08/452,405	May 27, 1997	5,632,777	Mentor Corporation
AUSTRIA	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
AUSTRALIA	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	19793/95		701672	Mentor Corporation
AUSTRALIA	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	January 16, 1998	52106/98	September 30, 1999	706502	Mentor Corporation

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Page 91 of 179

Country Status Title Filed Serialno Issued Patent No Owner

BELGIUM	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
CANADA	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	2186952	August 5, 2003	2186952	Mentor Corporation
SWITZERLAND	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
GERMANY	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
DENMARK	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
EPO	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
SPAIN	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
FRANCE	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
UK	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
GREECE	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation

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Page 92 of 179

Country Status Title Filed Serialno Issued Patent No Owner

IRELAND	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
ITALY	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
NETHERLANDS	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
PORTUGAL	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
SWEDEN	Issued	TESTICULAR PROSTHESIS AND METHOD OF MANUFACTURE AND FILLING	March 3, 1995	95912734.1	June 13, 2001	0748192	Mentor Corporation
US	Issued	SELF-SEALING INJECTION SITES AND PLUGS	October 30, 1996	08/739,617	March 10, 1998	5,725,507	Mentor Corporation
US	Issued	A METHOD FOR MANUFACTURING IMPROVED SELF-SEALING INJECTION SITES AND PLUGS (AS AMENDED)	September 11, 1997	08/927,327	August 10, 1999	5,935,362	Mentor Corporation
CANADA	Issued	SELF-SEALING INJECTION SITES AND PLUGS	March 3, 1995	2193651	July 26, 2005	2193651	Mentor Corporation
GERMANY	Issued	SELF-SEALING INJECTION SITES AND PLUGS	March 3, 1995	95912036.1	December 18, 2002	0766573	Mentor Corporation
EPO	Issued	SELF-SEALING INJECTION SITES AND PLUGS	March 3, 1995	95912036.1	December 18, 2002	0766573	Mentor Corporation
FRANCE	Issued	SELF-SEALING INJECTION SITES AND PLUGS	March 3, 1995	95912036.1	December 18, 2002	0766573	Mentor Corporation
UK	Issued	SELF-SEALING INJECTION SITES AND PLUGS	March 3, 1995	95912036.1	December 18, 2002	0766573	Mentor Corporation
ITALY	Issued	SELF-SEALING INJECTION SITES AND PLUGS	March 3, 1995	95912036.1	December 18, 2002	0766573	Mentor Corporation

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Page 93 of 179

Country	Status	Title	Filed	Serialno	Issued	Patent No	Owner
NETHERLANDS	Issued	SELF-SEALING INJECTION SITES AND PLUGS	March 3, 1995	95912036.1	December 18, 2002	0766573	Mentor Corporation
US	Issued	RESUABLE WASHABLE ANCHORING DEVICE FOR A MEDICAL DEVICE AND ASSEMBLY	April 10, 1997	08/838,724	March 21, 2000	6,039,750	Mentor Corporation
US	Issued	URINARY CATHETER	June 7, 1995	08/486,379	July 6, 1999	5,919,170	Mentor Corporation
US	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 12, 1996	08/747,223	April 20, 1999	5,895,424	Mentor Corporation
BELGIUM	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 11, 1997	97947390.7	May 21, 2003	1011540	Mentor Corporation
GERMANY	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 11, 1997	69722268.3-08	May 21, 2003	1011540	Mentor Corporation
EPO	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 11, 1997	97947390.7	May 21, 2003	1011540	Mentor Corporation
SPAIN	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 11, 1997	97947390.7	May 21, 2003	1011540	Mentor Corporation
FRANCE	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 11, 1997	97947390.7	May 21, 2003	1011540	Mentor Corporation
UK	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 11, 1997	97947390.7	May 21, 2003	1011540	Mentor Corporation
LUXEMBOURG	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 11, 1997	97947390.7	May 21, 2003	1011540	Mentor Corporation

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Page 94 of 179

Country Status Title Filed Serialno Issued Patent No Owner

NETHERLANDS	Issued	PROSTHESIS HAVING AN ALIGNMENT INDICATOR AND METHOD OF USING SAME	November 11, 1997	97947390.7	May 21, 2003	1011540	Mentor Corporation
US	Issued	METHOD OF MAKING A MALE CATHETER	September 17, 1993	08/122,399	July 14, 1998	5,779,964	Mentor Corporation
US	Issued	PROSTHESIS WITH IMPROVED PUMP	October 10, 1990	07/597,088	November 5, 1991	5,062,417	Mentor Corporation
US	Issued	CORPUS CAVERNOSUM IMPLANT DEVICE	May 14, 1990	08/522,821	November 26, 1991	5,067,485	Mentor Corporation
US	Issued	RESORBABLE URETHRAL STENT AND APPARATUS FOR ITS INSERTION	November 8, 1990	07/610,543	November 3, 1992	5,160,341	Mentor Corporation
US	Issued	DISPOSABLE URINE BAG	May 14, 1993	08/061,901	October 3, 1995	5,454,798	Mentor Corporation
US	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 22, 1991	08/733,426	December 1, 1992	5,167,611	Mentor Corporation
BELGIUM	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 7, 1992	92306229.3	November 5, 1997	0526016	Mentor Corporation
CANADA	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 22, 1992	2074391	October 1, 2002	2074391	Mentor Corporation
GERMANY	Issued	PENILE IMPLANT WITH LENGTHENING CYLINGER	July 7, 1992	92306229.3	November 5, 1997	0526016	Mentor Corporation
EPO	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 7, 1992	92306229.3	November 5, 1997	0526016	Mentor Corporation
SPAIN	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 7, 1992	92306229.3	November 5, 1997	0526016	Mentor Corporation
FRANCE	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 7, 1992	92306229.3	November 5, 1997	0526016	Mentor Corporation
UK	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 7, 1992	92306229.3	November 5, 1997	0526016	Mentor Corporation
ITALY	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 7, 1992	92306229.3	November 5, 1997	0526016	Mentor Corporation

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Page 95 of 179

Country Status Title Filed Serialno Issued Patent No Owner

NETHERLANDS	Issued	PENILE IMPLANT WITH LENGTHENING CYLINDER	July 7, 1992	92306229.3	November 5, 1997	0526016	Mentor Corporation
US	Issued-B	UNITARY INFLATABLE PENILE PROSTHESIS	September 12, 1991	07/758,738	October 5, 1993	5,250,020	Mentor Corporation
US	Issued	METHOD OF APPLING ADHESIVE TO A MALE EXTERNAL URINARY COLLECTION DEVICE	March 6, 1987	06/944,668	July 11, 1989	4,846,909	Mentor Corporation
US	Issued	METHOD OF SIMULTANEOUSLY FORMING CONTAINER STRAP HOLDERS ON URINARY LATEX CONTAINERS	December 17, 1991	07/808,735	July 28, 1992	5,133,923	Mentor Corporation
US	Issued-B	LATEX URINE CONTAINER HAVING ODOR IMPERMEABLE TREATMENT AND PROVIDED WITH INTEGRAL STRAP HOLDERS	February 13, 1992	07/834,859	November 23, 1993	5,263,946	Mentor Corporation
US	Issued	RADIOACTIVE SEED-HOLDING DEVICE	February 23, 2001	09/792,307	June 3, 2003	6,572,527	Mentor Corporation
US	Issued	RADIOACTIVE SEED-HOLDING DEVICE	October 2, 2002	10/262,928	January 27, 2004	6,682,471	Mentor Corporation
US	Issued	URINE COLLECTION BAG	March 28, 2002	29/158,024	June 17, 2003	D476,079	Mentor Corporation
US	Issued	URINE COLLECTION BAG	March 26, 2003	29/178,432	October 12, 2004	D497,205	Mentor Corporation
US	Issued	URINE COLLECTION BAG	March 26, 2003	29/178,445	October 5, 2004	D496,993	Mentor Corporation
US	Issued	URINE COLLECTION BAG	March 26, 2003	29/178,434	August 2, 2005	D508,128	Mentor Corporation
US	Issued	URINE COLLECTION BAG	March 26, 2003	29/178,444	September 28, 2004	D496,727	Mentor Corporation
AUSTRALIA	Issued	URINE COLLECTION BAG	September 26, 2002	3014/02	January 20, 2004	154305	Mentor Corporation

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Page 96 of 179

Country Status Title Filed Serialno Issued Patent No Owner

BENELUX	Issued	URINE COLLECTION BAG	September 27, 2002	79873-01	December 22, 2003	3548601-06	Mentor Corporation
CANADA	Issued	URINE COLLECTION BAG	September 25, 2002	100719	October 29, 2003	100719	Mentor Corporation
CANADA	Issued	URINE COLLECTION BAG	September 25, 2002	104436	October 29, 2003	104436	Mentor Corporation
CHINA	Issued	URINE COLLECTION BAG	September 27, 2002	02345554.3	June 16, 2004	ZL02345554.3	Mentor Corporation
CHINA	Issued	URINE COLLECTION BAG	September 27, 2002	200430046225.8	June 1, 2005	ZL200430046	Mentor Corporation
CHINA	Issued	URINE COLLECTION BAG	September 27, 2002	200430046226.2	June 1, 2005	ZL200430046	Mentor Corporation
CHINA	Issued	URINE COLLECTION BAG	September 27, 2002	200430046227.7	June 1, 2005	ZL200430046	Mentor Corporation
CHINA	Issued	URINE COLLECTION BAG	September 27, 2002	200430046228.1	June 22, 2005	ZL200430046	Mentor Corporation
CHINA	Issued	URINE COLLECTION BAG	September 27, 2002	200430046229.6	June 1, 2005	ZL200430046	Mentor Corporation
GERMANY	Issued	URINE COLLECTION BAG	September 26, 2002	40208195.1	November 25, 2002	40208195.1	Mentor Corporation
SPAIN	Issued	URINE COLLECTION BAG	September 27, 2002	155148	June 25, 2003	155148	Mentor Corporation
FRANCE	Published	URINE COLLECTION BAG	September 27, 2002	025799			Mentor Corporation
UK	Issued	URINE COLLECTION BAG	September 26, 2002	3007337	January 8, 2003	3007337	Mentor Corporation
ITALY	Issued	URINE COLLECTION BAG	September 27, 2002	MI2002O000645	February 3, 2005	87042	Mentor Corporation
JAPAN	Issued	URINE COLLECTION BAG	September 27, 2002	26,486/2002	January 17, 2003	1,167,388	Mentor Corporation

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Page 97 of 179

Country Status Title Filed Serialno Issued Patent No Owner

TAIWAN	Issued	URINE COLLECTION BAG	September 30, 2002	91305510	July 21, 2004	089500	Mentor Corporation
US	Issued	BRACHYTHERAPY MEDICAL DEVICES	November 2, 2001	10/008,372	October 28, 2003	6,639,237	Mentor Corporation
US	Issued	URINE COLLECTION BAGS FOR URINARY CATHETER SYSTEMS	December 11, 2001	10/015,485	May 3, 2005	6,887,230	Mentor Corporation
AUSTRALIA	Pending	URINE COLLECTION BAGS FOR URINARY CATHETER SYSTEMS	December 11, 2001	2002236611			Mentor Corporation
CHINA	Published	URINE COLLECTION BAGS FOR URINARY CATHETER SYSTEMS	December 11, 2001	01822930.1			Mentor Corporation
EPO	Published	URINE COLLECTION BAGS FOR URINARY CATHETER SYSTEMS	December 11, 2001	01986145.9			Mentor Corporation
HONG KONG	Published	URINE COLLECTION BAGS FOR URINARY CATHETER SYSTEMS	December 11, 2001	04103116.9			Mentor Corporation
US	Issued	MALE EXTERNAL CATHETERS	May 10, 2002	10/143,521	October 19, 2004	6,805,690	Mentor Corporation
AUSTRALIA	Pending	MALE EXTERNAL CATHETERS	May 9, 2003	2003239398			Mentor Corporation
BRAZIL	Pending	MALE EXTERNAL CATHETERS	May 9, 2003	PI 0309895-8			Mentor Corporation
CANADA	Pending	MALE EXTERNAL CATHETERS	May 9, 2003	2485388			Mentor Corporation
EPO	Pending	MALE EXTERNAL CATHETERS	May 9, 2003	03733980.1			Mentor Corporation
HONG KONG	Pending	MALE EXTERNAL CATHETERS	December 12, 2005	05111414.0			Mentor Corporation
MEXICO	Pending	MALE EXTERNAL CATHETERS	May 9, 2003	PA/A/2004/011115			Mentor Corporation
US	Issued	BRACHYTHERAPY SEED APPLICATORS	May 24, 2002	10/155,905	December 2, 2003	6,656,107	Mentor Corporation
US	Issued	OSTOMY BAGS	August 20, 2001	09/932,116	November 25, 2003	6,652,496	Mentor Medical Limited

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Page 98 of 179

Country Status Title Filed Serialno Issued Patent No Owner

US	Issued	MEDICO-SURGICAL BAGS	April 16, 1998	09/060,963	May 23, 2000	6,066,120	Mentor Medical Limited
AUSTRALIA	Issued	MEDICO-SURGICAL BAGS	April 17, 1998	61941/98	September 27, 2001	738920	Mentor Medical Limited
GERMANY	Issued	DISPOSABLE MEDICO-SURGICAL BAGS	April 8, 1998	98302739.2	October 15, 2003	0875220	Mentor Medical Limited
EPO	Issued	DISPOSABLE MEDICO-SURGICAL BAGS	April 8, 1998	98302739.2	October 15, 2003	0875220	Mentor Medical Limited
FRANCE	Issued	DISPOSABLE MEDICO-SURGICAL BAGS	April 8, 1998	98302739.2	October 15, 2003	0875220	Mentor Medical Limited
UK	Issued	WC-DISPOSABLE BAG	April 8, 1998	9807446.1	December 6, 2000	2324761	Mentor Medical Limited
UK	Issued	DISPOSABLE MEDICO-SURGICAL BAGS	April 8, 1998	98302739.2	October 15, 2003	0875220	Mentor Medical Limited
ITALY	Issued	DISPOSABLE MEDICO-SURGICAL BAGS	April 8, 1998	98302739.2	October 15, 2003	0875220	Mentor Medical Limited
JAPAN	Published	MEDICO-SURGICAL BAGS	April 20, 1998	10-109569			Mentor Medical Limited
NETHERLANDS	Issued	DISPOSABLE MEDICO-SURGICAL BAGS	April 8, 1998	98302739.2	October 15, 2003	0875220	Mentor Medical Limited
GERMANY	Issued	MEDICO-SURGICAL AND SANITARY ARTICLES AND MATERIALS	May 27, 1992	92304749.2	August 5, 1996	69210474.7	Mentor Medical Limited
DENMARK	Issued	MEDICO-SURGICAL AND SANITARY ARTICLES AND MATERIALS	May 27, 1992	92304749.2	August 5, 1996	0518519	Mentor Medical Limited
EPO	Issued	MEDICO-SURGICAL AND SANITARY ARTICLES AND MATERIALS	May 27, 1992	92304749.2	August 5, 1996	0518519	Mentor Medical Limited
FRANCE	Issued	MEDICO-SURGICAL AND SANITARY ARTICLES AND MATERIALS	May 27, 1992	92304749.2	August 5, 1996	0518519	Mentor Medical Limited
UK	Issued	MEDICO-SURGICAL AND SANITARY ARTICLES AND MATERIALS	June 8, 1992	9212092.2	December 14, 1994	2257056	Mentor Medical Limited

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Page 99 of 179

Country Status Title Filed Serialno Issued Patent No Owner

US	Issued	MEDICO-SURGICAL AND SANITARY ARTICLES AND MATERIALS	August 7, 1987	07/082,607	September 19, 1989	4,868,024	Mentor Medical Limited
UK	Issued	MEDICO-SURGICAL AND SANITARY ARTICLES, MATERIALS AND METHODS	August 20, 1987	8719680.4		2195919	Mentor Medical Limited
AUSTRALIA	Issued	URINE BAG ASSEMBLIES	January 30, 1998	199852797	November 16, 2000	722368	Mentor Medical Limited
GERMANY	Issued	COLLECTION BAG	November 23, 1988	P3839434.0-51	June 17, 1992	3839434.0	Mentor Medical Limited
UK	Issued	BODY DISCHARGE COLLECTION BAGS	November 30, 1988	8827921.1	October 2, 1991	2213728	Mentor Medical Limited
US	Issued	STOMA BAG	April 22, 1997	29/069,504	September 29, 1998	D398,990	Mentor Medical Limited
GERMANY	Issued	STOMA BAG	February 11, 1997	M9701449.4		M9701449.4	Mentor Medical Limited
UK	Issued	STOMA BAG	November 14, 1996	2060982	March 4, 1997	2060982	Mentor Medical Limited
US	Issued	STOMA BAG	April 22, 1997	29/069,505		D389,991	Mentor Medical Limited
GERMANY	Issued	STOMA BAG	February 11, 1997	M9701426.5	May 14, 1997	M9701426.5	Mentor Medical Limited
UK	Issued	STOMA BAG	November 14, 1996	2060981	March 4, 1997	2060981	Mentor Medical Limited
US	Issued	A DRAINAGE BAG	April 23, 1990	07/513,589	July 13, 1993	D337,382	Mentor Medical Limited
BENELUX	Issued	A DRAINAGE BAG	April 20, 1990	19989-00		19989-00	Mentor Medical Limited
DENMARK	Issued	A DRAINAGE BAG	May 30, 1991	0798/1991		0798/1991	Mentor Medical Limited
SPAIN	Issued	A DRAINAGE BAG	April 23, 1990	121942	November 16, 1990	121942	Mentor Medical Limited

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Country Status Title Filed Serialno Issued Patent No Owner

FRANCE	Issued	A DRAINAGE BAG	April 23, 1990	902263		287136	Mentor Medical Limited
UK	Issued	A DRAINAGE BAG	April 23, 1990	2006309	August 31, 1990	2006309	Mentor Medical Limited
ITALY	Issued	DRAINAGE BAG	April 23, 1990	021057		58403	Mentor Medical Limited
NORWAY	Issued	A DRAINAGE BAG		N/A	April 23, 2000	69120	Mentor Medical Limited
SWEDEN	Issued	A DRAINAGE BAG	April 20, 1990	N/A		49434	Mentor Medical Limited
US	Pending	LOW PROFILE TAP	September 17, 2003	29/190,234			Mentor Medical Limited
UK	Issued	LOW PROFILE TAP WITHOUT GRIP TABS	March 17, 2003	3011684	September 15, 2003	000076658-0001	Mentor Medical Limited
UK	Published	TAP	February 6, 2003	0302760.4			Mentor Medical Limited
US	Issued	URINE COLLECTION BAGS FOR URINARY CATHETER SYSTEMS	October 9, 2002	10/267,226	February 21, 2006	7001370	Mentor Corporation
US	Allowed	DAISY TAP	September 17, 2003	29/190,277	February 7, 2006	D514663	Mentor Medical Limited
UK	Issued	DAISY TAP	March 17, 2003	3011685	September 15, 2003	000076658-0002	Mentor Medical Limited
EPO	Issued	RESEALABLE SAMPLING PORT	February 6, 1992	92300992.2	April 26, 1995	0499401	Mentor Medical Limited
UK	Issued	RESEALABLE SAMPLING PORT	February 6, 1992	92300992.2	April 26, 1995	0499401	Mentor Medical Limited
US	Issued	SEED MAGAZINE	January 29, 2003	10/354,950	October 11, 2005	6,953,426	Mentor Corporation
US	Pending	SEED MAGAZINE	August 2, 2005	11/196,659			Mentor Corporation

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Page 101 of 179

Country Status Title Filed Serialno Issued Patent No Owner

AUSTRALIA	Pending	SEED MAGAZINE FOR BRACHYTHERAPY	January 28, 2004	2004210143			Mentor Corporation
CANADA	Pending	SEED MAGAZINE FOR BRACHYTHERAPY	January 28, 2004	2514448			Mentor Corporation
EPO	Pending	SEED MAGAZINE FOR BRACHYTHERAPY	January 28, 2004	04705984.5			Mentor Corporation
JAPAN	Pending	SEED MAGAZINE FOR BRACHYTHERAPY	January 28, 2004	100102978			Mentor Corporation
US	Issued	LOW PROFILE TAP WITH GRIP TABS	September 17, 2003	29/190,240	April 4, 2006	D518573	Mentor Medical Limited
UK	Issued	LOW PROFILE TAP WITH GRIP TABS	March 17, 2003	3011683	September 15, 2003	000076658-0003	Mentor Medical Limited
US	Issued	METHOD FOR TREATING URINARY INCONTINENCE IN WOMEN AND IMPLANTABLE DEVICE INTENDED TO CORRECT URINARY INCONTINENCE	March 5, 2002	10/092,069	October 28, 2003	6,638,211	Mentor Corporation
US	Published	METHOD FOR TREATING URINARY INCONTINENCE IN WOMEN AND IMPLANTABLE DEVICE INTENDED TO CORRECT URINARY INCONTINENCE	January 21, 2005	11/040,698			Mentor Corporation
EPO	Published	METHOD FOR TREATING URINARY INCONTINENCE IN WOMEN AND IMPLANTABLE DEVICE INTENDED TO CORRECT URINARY INCONTINENCE	July 3, 2001	01949616.5			Mentor Corporation
FRANCE	Issued	METHOD FOR TREATING URINARY INCONTINENCE IN WOMEN AND IMPLANTABLE DEVICE INTENDED TO CORRECT URINARY INCONTINENCE	July 5, 2000	00.08706		2811218	Mentor Corporation
US	Published	BRACHYTHERAPY APPLICATOR CHUCK	December 5, 2003	10/729,782			Mentor Corporation

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Page 102 of 179

Country Status Title Filed Serialno  Issued Patent No Owner

US	Pending	RADIATION SHIELDING DEVICE	August 13, 2004	10/918,846			Mentor Corporation
PCT	Pending	RADIATION SHIELDING DEVICE	August 11, 2005	PCT/US2005/28418			Mentor Corporation
US	Pending	URINARY CATHETER ASSEMBLY	August 2, 2004	10/909,747			Mentor Corporation
CHILE	Pending	URINARY CATHETER ASSEMBLY	August 1, 2005	1936/2005			Mentor Corporation
PCT	Pending	URINARY CATHETER ASSEMBLY	August 1, 2005	PCT/US2005/027252			Mentor Corporation
US	Pending	OBTURATOR INTRODUCER WITH SNARE	January 28, 2005	11/046,392			Mentor Corporation
PCT	Pending	OBTURATOR INTRODUCER WITH SNARE	January 28, 2006				Mentor Corporation
PCT	Pending	ADAPTER FOR PENILE PROSTHESIS TIP EXTENDER					Mentor Corporation
US	Pending	ADAPTER FOR PENILE PROSTHESISTIP EXTENDER	April 1, 2005	11/096,478			Mentor Corporation
US	Issued	SCOPE AND STENT SYSTEM	June 18, 1990	07/539,865	November 3, 1992	5,159,920	Mentor Corporation
US	Issued	TRANSPARENT PROSTRATE DILATION BALLOON AND SCOPE	September 27, 1990	07/589,048	February 23, 1993	5,188,596	Mentor Corporation
US	Issued	TUBING CONNECTOR	March 14, 1989	07/323,343	January 2, 1990	4,890,866	Mentor Corporation
US	Pending	HAMMOCK ADDED ARMS	June 7, 2005	11/146,280			Mentor Corporation (assignment filed 12/14/05)

Seller Listing Schedules

Page 103 of 179

Country Status Title Filed Serialno Issued Patent No Owner

US	Pending	PARIETAL HOOK	June 13, 2005	11/150,224			Mentor Corporation (assignment filed 12/14/05)
US	Pending	IMPLANT FOR TREATING RECTOCELE AND A DEVICE FOR PUTTING SAID IMPLANT IN PLACE	March 29, 2004	10/811,158			Mentor Corporation (assignment filed 12/14/05)
US	Pending	METHOD AND IMPLANT FOR CURING CYSTOCELE	March 26, 2004	10/809,798			Mentor Corporation (assignment filed 12/14/05)
US	Pending	ECHOGENIC MEDICAL DEVICE	April 22, 2004	10/828,539			Not yet assigned
US	Issued	ECHOGENIC MEDICAL DEVICE	June 7, 2001		April 20, 2004	6,723,052	Mills Biopharma- ceuticals, Inc.
UK	Issued	SINGLE USE TAP	April 29, 2003	0309800.1	July 28, 2004	2,390,547	Mentor Medical Limited
EPO	Issued	SINGLE USE TAP	April 28, 2004	04252458.7		1,473,001	Mentor Medical Limited
US	Pending	METHOD AND APPARATUS FOR SUPPORTING A BODY ORGAN	January 30, 2003	10/356,651			Mentor Corporation
US	Issued	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2000	09/587,642	September 9, 2003	6,616,593	Mentor Corporation
US	Issued	LOADING CLIP FOR RADIOISOTOPE SEEDS	September 11, 2000	09/658,636	July 29, 2003	6,599,231	Mentor Corporation
BRAZIL	Pending	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2001	PI 011111448-4			Mentor Corporation
CANADA	Pending	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2001	2,410,474			Mentor Corporation
EPO	Issued	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2001	01950271.5	January 11, 2006	1,286,724	Mentor Corporation

Seller Listing Schedules

Page 104 of 179

Country Status Title Filed Serialno Issued Patent No Owner

GERMANY	Pending	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2001	01950271.5			Mentor Corporation
SPAIN	Pending	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2001	01950271.5			Mentor Corporation
FRANCE	Pending	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2001	01950271.5			Mentor Corporation
UK	Pending	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2001	01950271.5			Mentor Corporation
ITALY	Pending	AUTOMATED RADIOISOTOPE SEED CARTRIDGE	June 5, 2001	01950271.5			Mentor Corporation
US	Issued	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2000	09/587,624	March 25, 2003	6,537,192	Mentor Corporation
US	Pending	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	January 31, 2003	10/355,603			Mentor Corporation
BRAZIL	Pending	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2001	PI01111443-3			Mentor Corporation
CANADA	Pending	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2001	2,409,977			Mentor Corporation
EPO	Issued	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2001	01941940.7	February 22, 2006	1286720	Mentor Corporation
GERMANY	Issued	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2001	01941940.7	February 22, 2006	1286720	Mentor Corporation
SPAIN	Issued	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2001	01941940.7	February 22, 2006	1286720	Mentor Corporation

Seller Listing Schedules

Page 105 of 179

Country Status Title Filed Serialno Issued Patent No Owner

FRANCE	Issued	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2001	01941940.7	February 22, 2006	1286720	Mentor Corporation
UK	Issued	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2001	01941940.7	February 22, 2006	1286720	Mentor Corporation
ITALY	Issued	AUTOMATED RADIOISOTOPE SEED LOADER SYSTEM FOR IMPLANT NEEDLES	June 5, 2001	01941940.7	February 22, 2006	1286720	Mentor Corporation
US	Issued	AUTOMATED IMPLANTATION SYSTEM FOR RADIOISOTOPE SEEDS	November 13, 2001	10/010,968	March 22, 2005	6,869,390	Mentor Corporation
US	Pending	AUTOMATED IMPLANTATION SYSTEM FOR RADIOISOTOPE SEEDS	March 22, 2005	11/086,779			Mentor Corporation
US	Pending	SELECTIVELY LOADABLE/SEALABLE BIORESORBABLE CARRIER ASSEMBLY FOR RADIOISOTOPE SEEDS	May 25, 2004	10/853,575			Mentor Corporation
PCT	Pending	SELECTIVELY LOADABLE/SEALABLE BIORESORBABLE CARRIER ASSEMBLY FOR RADIOISOTOPE SEEDS	March 31, 2005	PCT/US2005/10945			Mentor Corporation
US	Pending	PUMP W/ONE TOUCH RELEASE	December 19, 2005				Newly filed - not yet assigned to Mentor Corporation
UK	Issued	MEDICAL WASTE COLLECTION DEVICE	April 29, 2003		June 29, 2004	2390547	Mentor Medical Limited
Abandoned U.S. Patent No. 09/910,474 filed on July 20, 2001, entitled “Method and Apparatus For Supporting A Body Organ”, published January 17, 2002, under Publication No. 2002/0007222. (No representations or warranties are made with respect to the abandoned U.S. Patent No. 09/910,474).

Seller Listing Schedules

Page 106 of 179

Porges Patent Listing

Family Country Titular Filing Date Filing Number NumBrev Grant Titre

POR21	FR	Porges SAS	February 25, 1991	91 02213	2 673 110	October 16, 1998	BALLON SUREXTRUDE
POR25	DE	Porges SAS	May 25, 1994	94 401147 7	694 31 090 5 / 0 631 762	July 31, 2002	PROTHESE URETROSPIRAL
POR25	ES	Porges SAS	May 25, 1994	94 401147 7	2 177 567 / 0 631 762	July 31, 2002	PROTHESE URETROSPIRAL
POR25	FR	Porges SAS	June 24, 1993	93 07693	2 706 764		PROTHESE URETROSPIRAL
POR25	FR	Porges SAS	May 25, 1994	94 401147 7	0 631 762	July 31, 2002	PROTHESE URETROSPIRAL
POR25	GB	Porges SAS	May 25, 1994	94 401147 7	0 631 762	July 31, 2002	PROTHESE URETROSPIRAL
POR25	IT	Porges SAS	May 25, 1994	94 401147 7	0 631 762	July 31, 2002	PROTHESE URETROSPIRAL
POR25	JP	Porges SAS	June 24, 1994	06 143 421	3 321 494	June 21, 2002	PROTHESE URETROSPIRAL
POR25	US	Porges SAS	May 27, 1994	08/250577	5 514 178	May 7, 1996	PROTHESE URETROSPIRAL
POR27	FR	Porges SAS	April 17, 1996	96 04783	2 747 574	October 16, 1998	DISPOSITIF MAINTIEN CATHETER
POR28	DE	Porges SAS	September 23, 1997	97 402205 5	697 21 433.8 / 0 836 858	May 2, 2003	SYSTEME ASPIRATION LAVAGE
PPOR28	ES	Porges SAS	September 23, 1997	97402250.5	2195099/0836858	May 2, 2003	SYSTEME ASPIRATION LAVAGE
POR28	FR	Porges SAS	October 18, 1996	96 12686	2 754 716	November 13, 1998	SYSTEME ASPIRATION LAVAGE
POR28	FR	Porges SAS	September 23, 1997	97 402205 5	0 836 858	May 2, 2003	SYSTEME ASPIRATION LAVAGE

Seller Listing Schedules

Page 107 of 179

Family Country Titular Filing Date Filing Number NumBrev Grant Titre

POR28	GB	Porges SAS	September 23, 1997	97 402205 5	0 836 858	May 2, 2003	SYSTEME ASPIRATION LAVAGE
POR28	IT	Porges SAS	September 23, 1997	97 402205 5	0 836 858	May 2, 2003	SYSTEME ASPIRATION LAVAGE
POR28	US	Porges SAS	September 5, 1997	08/924139	6 149 622	November 2, 2000	SYSTEME ASPIRATION LAVAGE
POR29	DE	Porges SAS	September 24, 1997	97 402215 4	697 14 180 2 / 0 836 863	July 24, 2002	CATHETER A CORPS SECCABLE
POR29	DK	Porges SAS	September 24, 1997	97 402215 4	0 836 863	July 24, 2002	CATHETER A CORPS SECCABLE
POR29	ES	Porges SAS	September 24, 1997	97 402215 4	2 177 913 / 0 836 863	July 24, 2002	CATHETER A CORPS SECCABLE
POR29	FR	Porges SAS	October 18, 1996	96 12687	2 754 718	November 13, 1998	CATHETER A CORPS SECCABLE
POR29	FR	Porges SAS	September 24, 1997	97 402215 4	0 836 863	July 24, 2002	CATHETER A CORPS SECCABLE
POR29	GB	Porges SAS	September 24, 1997	97 402215 4	0 836 863	July 24, 2002	CATHETER A CORPS SECCABLE
POR29	IT	Porges SAS	September 24, 1997	97 402215 4	30059/BE/2002/ 0 836 863	July 24, 2002	CATHETER A CORPS SECCABLE
POR29	US	Porges SAS	September 5, 1997	08/924140	5 800 414	September 1, 1998	CATHETER A CORPS SECCABLE
POR30	DE	Porges SAS	March 26, 1998	98 400704 7	698 07 773 3 / 0 872 259	September 11, 2002	DRAIN MULTITUBULAIRE
POR30	ES	Porges SAS	March 26, 1998	98 400704 7	0 872 259	September 11, 2002	DRAIN MULTITUBULAIRE
POR30	FR	Porges SAS	April 14, 1997	97 04532	2 761 891	September 24, 1999	DRAIN MULTITUBULAIRE
POR30	FR	Porges SAS	March 26, 1998	98 400704 7	0 872 259	September 11, 2002	DRAIN MULTITUBULAIRE
POR30	GB	Porges SAS	March 26, 1998	98 400704 7	0 872 259	September 11, 2002	DRAIN MULTITUBULAIRE

Seller Listing Schedules

Page 108 of 179

Family Country Titular Filing Date Filing Number NumBrev Grant Titre

POR30	IT	Porges SAS	March 26, 1998	98 400704 7	325 18/BE/2002/ 0 872 259	September 11, 2002	DRAIN MULTITUBULAIRE
POR30	JP	Porges SAS	April 14, 1998	10/102961			DRAIN MULTITUBULAIRE
POR30	US	Porges SAS	March 30, 1998	09/050102	5 891 111	April 6, 1999	DRAIN MULTITUBULAIRE
POR32	DE	Porges SAS	July 16, 1998	98 401787 1	698 24 677 2 / 0 906 750	June 23, 2004	PROTHESE SPHINCTERIENNE
POR32	ES	Porges SAS	July 16, 1998	98 401787 1	0 906 750	June 23, 2004	PROTHESE SPHINCTERIENNE
POR32	FR	Porges SAS	August 27, 1997	97 10694	2 767 673	November 26, 1999	PROTHESE SPHINCTERIENNE
POR32	FR	Porges SAS	July 16, 1998	98 401787 1	0 906 750	June 23, 2004	PROTHESE SPHINCTERIENNE
POR32	GB	Porges SAS	July 16, 1998	98 401787 1	0 906 750	June 23, 2004	PROTHESE SPHINCTERIENNE
POR32	IT	Porges SAS	July 16, 1998	98 401787 1	0 906 750	June 23, 2004	PROTHESE SPHINCTERIENNE
POR34	EP	Porges SAS	September 17, 2002	02 11501	1 400 210		Extracteur chirugical pour l’extraction
PPOR34	FR	Porges SAS	September 17, 2002	0211501	1 473 001		Extracteur chirugical pour l’extraction
POR35	EP	Porges SAS	September 16, 2003	03 292285 8			Dispositif pour prelever un ĕchantillon
POR35	FR	Porges SAS	October 3, 2002	02 12234			Dispositif pour prelever un ĕchantillon
POR35	JP	Porges SAS	October 2, 2003	15-344606			Dispositif pour prelever un ĕchantillon

Seller Listing Schedules

Page 109 of 179

Porges Patent Listing of Abandoned Patents (No representations or warranties are made with respect to any Patents listed below that have expired or are being abandoned)

Family Country Titular Filing Date Filing Number NumBrev Grant Titre

POR18	FR	Porges	May 12, 1989	89 06244	2 646 771	October 17, 1997	BLOQUER HYDRAULIQUE
POR19	FR	Porges	October 26, 1990	90 403032 7	0 426 545	August 25, 1993	INVERSEUR DE PRESSION
POR20	FR	Porges	January 31, 1991	91 00042	2 671 282	June 12, 1998	POUSSOIR CONNECTABLE
POR22	FR	Porges	May 5, 1992	92 05516	2 590 842		APPLICATEUR ETUI PENIEN DC
POR22	FR	Porges	May 4, 1993	93 401149 5	0 569 287	July 10, 1996	APPLICATEUR ETUI PENIEN DC
POR22	US	Porges	May 3, 1993	08/055563	5 318 551	June 7, 1994	APPLICATEUR ETUI PENIEN DC
POR24	FR	Porges	July 20, 1992	92 08927	2 693 651		APPLICATEUR ETUI PENIEN 2
POR24	FR	Porges	June 30, 1993	93 401699 9	0 580 470	May 19, 1999	APPLICATEUR ETUI PENIEN 2
POR24	US	Porges	July 19, 1993	08/092889	5 380 311	January 10, 1995	APPLICATEUR ETUI PENIEN 2
POR26	DE	Porges	February 6, 1995	95 400241 6	095 23 964 3 / 0 669 118	November 21, 2001	APPLICATEUR ETUI PENIEN V
POR26	DK	Porges	February 6, 1995	95 400241 6	0 669 118	November 21, 20r01	APPLICATEUR ETUI PENIEN V
POR26	ES	Porges	February 6, 1995	95 400241 6	0 669 118	November 21, 2001	APPLICATEUR ETUI PENIEN V
POR26	FR	Porges	February 24, 1994	94 02111	2 716 366		APPLICATEUR ETUI PENIEN V
POR26	GB	Porges	February 6, 1995	95 400241 6	0 669 118	November 21, 2r001	APPLICATEUR ETUI PENIEN V
POR26	IT	Porges	February 6, 1995	95 400241 6	0 6r69 118	November 21, 2001	APPLICATEUR ETUI PENIEN V
POR33	DE	Porges	February 2, 1999	99 400220 2	699 11 823 9 / 0 935 974	October 8, 2003	DEPOSITIF TELESCOPIQUE

Seller Listing Schedules

Page 110 of 179

Family Country Titular Filing Date Filing Number NumBrev Grant Titre

POR33	ES	Porges	February 2, 1999	99 400220 2	0 935 974	October 8, 2003	DEPOSITIF TELESCOPIQUE
POR33	FR	Porges	February November 1998	98 01619	2 774 598	June 23, 2000	DEPOSITIF TELESCOPIQUE
POR33	FR	Porges	February 2, 1r999	99 400220 2	0 935 974	October 8, 2003	DEPOSITIF TELESCOPIQUE
POR33	GB	Porges	February 2, 1999	99 400220 2	0 935 974	October 8, 2003	DEPOSITIF TELESCOPIQUE
POR33	IT	Porges	February 2, 1999	99 400220 2	19r102/BE/2004/ 0 935 974	October 8, 2003	DEPOSITIF TELESCOPIQUE

Seller Listing Schedules

Page 111 of 179

Schedule 1.183

Transferred Real Property

(a) Non-U.S.

None.

(b) U.S.

Minnesota

Address:

1499, 1525, 1601 and 1615 West River Road

Minneapolis, Minnesota

Legal Description:

The land situated in the State of Minnesota, County of Hennepin, and described as follows:

PARCEL 1:

Lot 1, Block 2, North Washington Industrial Center 2^nd Addition, according to the recorded plat thereof on file and of record in the office of the County Recorder, Hennepin County, Minnesota.

PARCEL 2:

That part of Lot 2, Block 2, North Washington Industrial Center 2^nd Addition, lying North of a line drawn Easterly and at right angles from a point in the Westerly line of said Lot 2 which point is 65 feet Southerly from the Northwest corner, to its intersection with the westerly line of West River Road as now laid out, according to the plat thereof on file and of record in the office of the County Recorder, Hennepin County, Minnesota.

Together with and subject to the rights and easements described in that certain Reciprocal Easement Agreement recorded as Document No. 4379570, as amended by that certain Amendment to Reciprocal Easement Agreement recorded as Document No. 4379571, in the office of the County Recorder, Hennepin County, Minnesota.

PARCEL 3:

Lot 3, and that part of Lot 2 lying South of a line running East as measured at right angles from a point in the west line thereof distant 65 feet South from the northwest corner thereof, Block 2, North Washington Industrial Center 2^nd Addition, according to the plat thereof on file and of record in the office of the County Recorder, Hennepin County, Minnesota.

Seller Listing Schedules

Page 112 of 179

PARCEL 4:

Apartment No. A, Apartment Ownership No. 96, North River Road Industrial Condominium, 1401 West River Road North, Minneapolis, Minnesota located on the following described land: Lots 5 and 6, Block 2, North Washington Industrial Center 2^nd Addition, except that part of said Lot 5 which lies North of a line drawn parallel with and 58 feet South, as measured at right angles, from the North line of said Lot 5, according to the recorded plat thereof on file and of record in the office of the County Recorder, Hennepin County, Minnesota.

Together with and subject to an undivided interest in the common areas and facilities, as set forth in the Declaration of North River Road Industrial Condominium Apartment Ownership No. 96 and attached Bylaws recorded March 9, 1978 as Document No. 4362001, and the Floor Plans recorded March 9, 1978 as Document No. 4362002; as amended by the Amendment No. 1 to Declaration of North River Road Industrial Condominium Apartment Ownership No. 96 and the attached Amended Floor Plan, recorded October 6, 1989 as Document No. 5581512, in the Office of the County Recorder, Hennepin County, Minnesota.

Oklahoma

Address:

120 N.E. 26^th Street

Oklahoma City, Oklahoma

Legal Description:

A part of Block Eleven (11), in BARROWS ADDITION to Oklahoma City, Oklahoma County, Oklahoma, according to the recorded plat thereof, being more particularly described as follows:

BEGINNING at the Northeast corner of said Block 11;

Thence West a distance of 150 feet;

Thence South a distance of 135 feet;

Thence East a distance of 150 feet;

Thence North a distance of 135 feet to the Point or Place of Beginning.

AND

Seller Listing Schedules

Page 113 of 179

A part of Block Twelve (12), in BARROWS ADDITION to Oklahoma City, Oklahoma County, Oklahoma, according to the recorded plat thereof, being more particularly described as follows:

BEGINNING at the Northwest corner of Block 12, BARROWS ADDITION;

Thence East 250 feet;

Thence South 135 feet;

Thence West 250 feet;

Thence North 135 feet to the point of Beginning.

Seller Listing Schedules

Page 114 of 179

Schedule 1.184

Transferred Subsidiaries

Mentor International LLC (Delaware)

Mentor International EURL (France)

Porges SAS (France)

Porges S.r.l. (Italy)

Porges Co. Ltd. (Japan)

Porges Co. Ltd. (Portugal)

Porges-Reprex S.L. (Spain)

Porges Gmbh (Germany)

Mentor Medical Limited (UK)

Porges UK Limited (UK)

Mentor Development Limited Partnership (Minnesota)

Seller Listing Schedules

Page 115 of 179

Schedule 1.186

Transferred Tangible Assets

The assets set forth on Annex C hereto.

All fixed and other tangible assets (other than real property and buildings, inventory and Excluded Assets) owned by Seller or any Seller Subsidiaries located at Seller’s or Seller’s Subsidiaries’ facilities at the following addresses:

1401, 1499, 1525, 1601, 1615 West River Road North

Minneapolis, MN 55411

120 NE 26^th Street

Oklahoma City, OK 73105

All fixed and other tangible assets (other than real property and buildings, inventory and Excluded Assets) owned by Mentor Benelux BV primarily for use in the Business.

It is understood that Buyer shall receive all fixed and other tangible assets (other than real property and buildings and Excluded Assets) of the Transferred Subsidiaries by virtue of Buyer’s acquisition of the Transferred Equity Interests.

Seller Listing Schedules

Page 116 of 179

Schedule 3.2(g)

Conveyance Jurisdictions

France

Italy

Japan

Netherlands

Portugal

Spain

Germany

United Kingdom

United States

Other applicable jurisdictions set forth on Schedule 1.174 (Transferred Copyrights), Schedule 1.181(a) (Transferred Marks) and Schedule 1.182 (Transferred Patents).

Seller Listing Schedules

Page 117 of 179

Schedule 3.2(m)

Released Encumbrances

Under a $200,000,000 Credit Agreement with Bank of the West, Union Bank of California, N.A. and Wells Fargo Bank, National Association, dated May 25, 2005, two Subsidiaries of Seller, including a Transferred Subsidiary, guarantee any borrowings made under such Credit Agreement, pursuant to a Guaranty dated as of May 25, 2005. Borrowings under the Credit Agreement are secured (UCC File Record No. 200516701312) by the outstanding capital stock of various Mentor Subsidiaries, including 65% of the capital stock of Porges, SA, a Transferred Subsidiary, all as set forth in a Pledge Agreement dated as of May 25, 2005.

Liens of Record on Mentor Corporation, UCC File Record Nos. 200376897331 and 200515352320, in favor of US Bancorp securing Leased Equipment including copiers.

Seller Listing Schedules

Page 118 of 179

EE ID Name Loc Dept Name Title

000208	Amerson,David	CA-SB	Urology Sales Admin	VP Domestic Sales & Mktg Uro
000116	Springer,Thomas J	OK	MBI Administration	VP General Manager MBI
000996	Yang,Philip	CA-SB	Regulatory Submissions	Vice President Reg Submissions
003772	Palmer,Timothy	MN	Manufacturing Administration	Vice President Manufacturing
004301	Anderson,John	CA-SB	Healthcare Marketing	Director Marketing
004358	Reich,Lisa A	CA-SB	Surgical Marketing	Director Marketing
004483	Gay,Travis	CA-SB	Oncology	Nat Sales Manager-Oncology
004281	Kline,Cliff	CA-SB	Clinical Submissions	Program Director Clinical
004559	Crawford,Donna	CA-SB	Regulatory Submissions	Program Director
003678	Uhlemann,Richard	MN	Surgical Mfg Administration	Manager Manufacturing
003461	Schumer,Jim	MN	Manufacturing Engineering	Director Engineering
004336	Pitman,Charles R	CA-SB	Oncology Marketing	Market Manager
003942	Blatherwick,Mary V	MN	Accounting	Controller
003995	Pydi,Chandrasekhar	MN	MAT	Manager Info Tech
020045	Theissen,Stephen	MN	Divisional QA Minn	Director RA/QA
003561	Modert,Keith	MN	R&D Administration	Manager R&D
000188	Caplan,Lawrence	AZ	Uro Sales Western Region	Regional Manager
000207	Rule,Todd	FL	Uro Sales Southern Region	Regional Manager
004091	Sellwood,Christopher S	MN	Uro Sales Northwest Region	Regional Manager
000236	Tantillo,Raymond	NJ	Uro Sales Mid-Atlantic Region	Regional Manager
000203	Valcarcel,John	OH	Uro Sales Great Lakes Region	Regional Manager
004088	Church,Bruce	TX	Uro Sales South-Central Region	Regional Manager
010131	O'Donnell,Kevin	CA-SB	Healthcare Marketing	Product Manager

Seller Listing Schedules

Page 119 of 179

EE ID Name Loc Dept Name Title

004650	Ledin,Gregg	MN	Advanced Manufacturing	Manager Engineering
020160	Pilling,Sue	MN	Warehousing/Distribution	Materials Manager
	van Velthoven, Ad	Benelux/Leiden		General Manager
000212	Morrell,Joel	FL	National Accounts	National Accounts Manager
000765	Eagles,Mark	MN	National Accounts	National Accounts Manager
001744	Kalvelage,Karen M.	MO	National Accounts	National Accounts Manager
004554	Reverman,William C	OR	National Accounts	National Accounts Manager
000256	Pellett,Donna	TX	Sales Training	National Sales Trainer
001718	McGuire,David	WA	Sales Training	National Sales Trainer
000132	Crawford,Paul A	OK	Support	IT Manager
020158	Larson,Bruce	MN	Human Resources	Manager Human Resources
020155	Ghai,Suresh K	MN	Surgical QA	RA/QA Program Manager
003227	Kramer,Tim	MN	Manufacturing Engineering	Project Manager
005004	Kubalak,Thomas	MN	Health Care R&D	Sr Engineer
003957	Berkey,John J	MN	MAT	Sr Engineer
020140	Strand,Joel J	MN	Advanced Manufacturing	Sr Engineer
001609	Curran-Moore, Melissa	CA-SB	Legal	Program Manager
005013	Moe,Sheila	MN	Divisional QA Minn	Sr Specialist
003923	Campagna,Joyce L	MN	Manufacturing Engineering	Manager Engineering
000087	Harkins,Jana R	OK	MBI Administration	Controller
003752	Moschel,Mark A	MN	Manufacturing Engineering	Sr Engineer
003776	Kegel,Paul J	MN	Materials Management	Manager Purchasing
003912	Noble,Birgitte A	MN	Accounting	Supervisor Accounting
003903	Smith,David R.	MN	Materials Management	Sr Buyer
003877	Schmitt,Jane C	MN	Materials Management	Sr Buyer
001952	Kruse,Maureen	CA-SB	HC Customer Service	Supervisor Customer Svc
003941	Daley,Emily	MN	Surgical R&D	Sr Engineer
000903	Feldman,Steven	CA-SB	Patient Services	Supervisor Mktg Services
003870	Munnich,John	MN	Information Systems	Supervisor IT
003907	Schnobrich,Scott	MN	Surgical Mfg Administration	Sr Scheduler

Seller Listing Schedules

Page 120 of 179

EE ID Name Loc Dept Name Title

020171	Wolter,David	MN	Warehousing/Distribution	Supervisor Warehouse
000071	Sztorc,Thomas	OK	Production	Manager Production
001786	Broumand,Teena	CA-SB	Healthcare Marketing	Product Manager
020166	Brouillard,Robert	MN	Advanced Manufacturing	Engineer
020146	Hoople,Cal	MN	Quality Assurance Engineering	Engineer
003263	Chezick,John	MN	Healthcare Mfg Admin	Sr Scheduler
003696	Ringwelski,Joyce	MN	Surgical Mfg Administration	Supervisor Manufacturing
005140	Lawrence,Joseph	CA	Oncology	Oncology Specialist
000193	Anderson,Tim	CO	Oncology	Oncology Specialist
004417	Moreau,Michael	FL	Oncology	Oncology Specialist
005154	Anderson,William	NC	Oncology	Oncology Specialist
010103	Spivey,Dustin B	TX	Oncology	Oncology Specialist
020178	Soto,Omar	MN	Accounting	Sr Analyst Finance
003855	Shaw,Ben A	MN	Quality Assurance Engineering	Engineer
020079	Gustafson,Craig	MN	MAT	Specialist
009009	Lindberg,Susan	MN	Healthcare Mfg Admin	Supervisor Manufacturing
003357	Femrite,Dennis	MN	R&D Administration	Associate Engineer
010055	Linquiti,Ross	CA-SB	Accounts Receivable	Supervisor Accounting
000194	Goodman,Carl	CO	Uro Sales Northwest Region	Territory Mgr Uro Specialties
010173	Grant,David	IA	Uro Sales Northwest Region	Territory Mgr Uro Specialties
004270	Ford,Alphonso	CA	Uro Sales Western Region	Territory Mgr Uro Specialties
001046	Madsen,Bernhardt	FL	Uro Sales Southern Region	Territory Mgr Uro Specialties
001915	Wood Jr.,James S.	FL	Uro Sales Southern Region	Territory Mgr Uro Specialties
000232	Hicks,Stuart	GA	Uro Sales Mid-Atlantic Region	Territory Mgr Uro Specialties
000199	Fuselier,Harold	LA	Uro Sales South-Central Region	Territory Mgr Uro Specialties
004446	Billings,P M	SC	Uro Sales Southern Region	Territory Mgr Uro Specialties
003881	Hollingsworth,Terri R	MN	Facilities	Supervisor Facilities
004038	Gustafson,Gina	MN	Advanced Manufacturing	Engineer
000981	Arroyo,Adriana	CA-SB	Patient Services	Coordinator

Seller Listing Schedules

Page 121 of 179

EE ID Name Loc Dept Name Title

001913	Scorzelli,Francis	CA-SB	Treasury/Payroll	Buyer
020159	Daniel,Geoffrey A	MN	Surgical R&D	Engineer
003598	Gullickson,Don	MN	Healthcare Mfg Admin	Supervisor Manufacturing
003930	Lutzke,Robert	MN	Advanced Manufacturing	Engineer
003597	Haug,Brenda	MN	Surgical QC	Supervisor RA/QA
005152	Wirth,Warren	CA	Uro Sales Western Region	Territory Mgr Uro Specialties
010058	Washington,Terry	FL	Uro Sales Southern Region	Territory Mgr Uro Specialties
010219	Connors,Shawn	OH	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
010117	Gilbert,Christopher	TX	Uro Sales South-Central Region	Territory Mgr Uro Specialties
000210	Walsh,Kevin	NJ	Uro Sales Northern Region	Territory Mgr Uro Specialties
004349	Thorpe,Craig F	NY	Uro Sales Northern Region	Territory Mgr Uro Specialties
000719	Steinwehr,Stephanie	CA-SB	Patient Services	Coordinator
010286	Castle,Jennifer	CA-SB	Legal	Associate II Paralegal
003947	Saatzer,James A	MN	Healthcare Mfg Admin	Supervisor Manufacturing
003841	Costello,Stephen	MN	R&D Administration	Toolmaker III
	Kliffen, Sjaak	Benelux/Leiden		Administrative Manager
003938	Youngblood,Dennis	MN	R&D Administration	Sci & Tech Technician III
010113	Roberson,Lance	AL	Uro Sales South-Central Region	Territory Mgr Uro Specialties
003211	Mao,Geoffrey	CA	Uro Sales Western Region	Territory Mgr Uro Specialties
010047	Williams,Lori	CA	Uro Sales Western Region	Territory Mgr Uro Specialties
010223	Anderson,Yvette	FL	Uro Sales Southern Region	Territory Mgr Uro Specialties
010274	Royer,Chad	IN	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
010060	Goedeker,Francis	MO	Uro Sales Northwest Region	Territory Mgr Uro Specialties
010318	Choate,Kara	OK	Uro Sales South-Central Region	Territory Mgr Uro Specialties

Seller Listing Schedules

Page 122 of 179

EE ID Name Loc Dept Name Title

003917	Liska,Ruth M	MN	Human Resources	Sr Representative
005156	Kennedy,Amy	CA-SB	Surgical Marketing Pelvic	Associate Product Manager
008010	Maras,James	MN	Advanced Manufacturing	Manufacturing Tech III
004395	Friedrich,Grant J	CA-SB	Healthcare Marketing	Associate Product Manager
004396	Becking,Jennifer	CA-SB	Surgical Marketing	Coordinator, Marketing
003906	Stevenson,Vickie L	MN	Materials Management	Buyer
020088	Zaide,Michael P	MN	Quality Assurance Engineering	Quality Eng Tech III
	Brille,Wolfgang	Germany		Sales Representative
010309	McDougall,Elizabeth	AZ	Uro Sales Western Region	Territory Mgr Uro Specialties
000177	Primeau,Edward C	CA	Uro Sales Western Region	Territory Mgr Uro Specialties
004493	Rodriguez,Bernardo	CA	Uro Sales Western Region	Territory Mgr Uro Specialties
010312	Foley,Shaun	CT	Uro Sales Northern Region	Territory Mgr Uro Specialties
010317	Babb,Nanci	FL	Uro Sales Southern Region	Territory Mgr Uro Specialties
010250	Fandrich,Tina	FL	Uro Sales Southern Region	Territory Mgr Uro Specialties
010134	Gheiler,Monika	FL	Uro Sales Southern Region	Territory Mgr Uro Specialties
010256	Hemingway,Nancy	GA	Uro Sales Mid-Atlantic Region	Territory Mgr Uro Specialties
004002	Cysewski,Paul	IL	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
010304	Gross,Trent	IL	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
010264	Boomsaad,Erika	KS	Uro Sales Northwest Region	Territory Mgr Uro Specialties
010140	Scholtz,Kathryn	MD	Uro Sales Mid-Atlantic Region	Territory Mgr Uro Specialties
003241	Achtman,Steven	MI	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
010142	Sekerke,Jaime	MI	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
000240	Prischmann,Matthew	MN	Uro Sales Northwest Region	Territory Mgr Uro Specialties
010249	Dyess,David T	MS	Uro Sales South-Central Region	Territory Mgr Uro Specialties

Seller Listing Schedules

Page 123 of 179

EE ID Name Loc Dept Name Title

010137	Nooney,Amy	NC	Uro Sales Mid-Atlantic Region	Territory Mgr Uro Specialties
010112	OPEN	NC	Uro Sales Mid-Atlantic Region	Territory Manager Surg/HC
004492	Shiffer,Daniel	NJ	Uro Sales Northern Region	Territory Mgr Uro Specialties
010242	Freedman,Lara	NY	Uro Sales Northern Region	Territory Mgr Uro Specialties
000228	Hirschbach,Jennifer	NY	Uro Sales Northern Region	Territory Mgr Uro Specialties
010243	Silva,Rick	NY	Uro Sales Northern Region	Territory Mgr Uro Specialties
010241	Bilczo,Keith	OH	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
004089	Burke,Dana	OH	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
010245	Bacon,Jennifer	OR	Uro Sales Western Region	Territory Mgr Uro Specialties
010302	Zone,Marcus	PA	Uro Sales Northern Region	Territory Mgr Uro Specialties
010014	Phillips,Monica	PA	Uro Sales Great Lakes Region	Territory Mgr Uro Specialties
010260	Rhyne,Paul	SC	Uro Sales Southern Region	Territory Mgr Uro Specialties
000239	Fearon,Molly	TN	Uro Sales South-Central Region	Territory Mgr Uro Specialties
010319	Cooley,Ben	TX	Uro Sales South-Central Region	Territory Mgr Uro Specialties
001323	Weeks,Sally L	TX	Uro Sales South-Central Region	Territory Mgr Uro Specialties
010277	Phelps,Tonya	VA	Uro Sales Mid-Atlantic Region	Territory Mgr Uro Specialties
010037	Khazaal,Megan	WA	Uro Sales Northwest Region	Territory Mgr Uro Specialties
010292	Piper,Tricia	WA	Uro Sales Northwest Region	Territory Mgr Uro Specialties
010248	Tille,Heath	WI	Uro Sales Northwest Region	Territory Mgr Uro Specialties
000064	Snow,Kenneth	OK	Support	Manager Safety
020156	Manson,Tim D	MN	Surgical R&D	Sci & Tech Technician III
000057	Kyle,Danny	OK	Quality	Manager Quality
003879	Korkowski,Brandon A	MN	Quality Assurance Engineering	Metrologist

Seller Listing Schedules

Page 124 of 179

EE ID Name Loc Dept Name Title

000939	Sanders,Katie	CA-SB	Financial Analysis	Analyst Sales Support
003950	Medenwaldt,Paul H	MN	Manufacturing Engineering	Manufacturing Tech III
001504	Nelson,James	MN	Surgical Maintenance	Production Maint Tech III
003766	Murray,Lori A	MN	Manufacturing Administration	Exec Secretary Admin Asst
000054	Kay,Penelope	OK	Document Control	Manager Document Control
020090	Swanson,Steven	MN	Facilities	Facil Maintenance Tech/HVAC
003909	Lesinska-Stierna,Anna	MN	Healthcare QA	Microbiology Tech III
010042	Russell,Gregory	CA-SB	Accounting	Accountant
003784	Livingstone,Marc S	MN	Surgical Maintenance	Production Maint Tech III
020175	Eiynck,Jason	MN	Information Systems	PLC/IT technician
001598	Gin,Mabel	CA-SB	Urology Sales Admin	Associate II
010063	Flores,Gabriela	CA-SB	Surgical Marketing Pelvic	Coordinator, Marketing
010266	Holcomb,Heather	TN	Uro Sales Mid-Atlantic Region	Territory Mgr Uro Specialties
003851	Plachetka,Randi R	MN	Product Evaluation	Specialist
	van Gorkum, Serge	Benelux/Leiden		Product Mgr Healthcare
001151	Stratton,Dana	CA-SB	Surgical Marketing	Associate II
000062	Stump,Robyn	OK	Distribution	Manager Distribution
020080	Bullis,Robert	MN	Quality Assurance Engineering	Calibration Technician
020168	Wood,Dale	MN	Healthcare Maintenance	Production Maint Tech III
020172	Naegle,Nathan	MN	Healthcare Mfg Admin	Supervisor Manufacturing
004615	Babel,Mark J	CA-SB	Surgical Customer Service	Associate III
004061	O'Malley,Dominic	CA-SB	Lit & Convention Services	Associate II
010326	Aguillon,Aimee	CA-SB	Surgical Marketing	Associate II
003209	Hanson,Susan K	MN	Surgical R&D	Sci & Tech Technician II

Seller Listing Schedules

Page 125 of 179

EE ID Name Loc Dept Name Title

003754	Lane,Michael P	MN	Document Control	Drafter
003085	Lero,Karen	MN	Document Control	Sr Documentation Associate
020089	Kihlman,Beth	MN	Divisional QA Minn	Administrative Assistant
000173	Staggs,Cori A	CA-SB	Healthcare Marketing	Associate II
000072	Young,Roy B	OK	ISO	Supervisor
	Rodenenburg-de Haas, Yvonne	Benelux/Leiden		Sales Rep Healthcare
003854	Thao,Tou	MN	Information Systems	IS Technician
003441	Luther,Lynn	MN	Manufacturing Engineering	Manufacturing Technician II
000136	Ogle,Cara C	OK	Quality Assurance	Associate Quality Engineer
009072	Johnsen,Marlene	MN	Surgical QC	Quality Inspector II
010230	Villalpando,Gerardo	CA-SB	Accounts Receivable	Associate III
004496	Hernandez,Robert	CA-SB	Accounts Receivable	Associate III
	Ooms, Danielle	Benelux/Belgium		Sales Rep Healthcare
000081	DeLeon,Mark A	OK	Production	Maintenance Technician
010325	Ortiz,Heidi	CA-SB	Surgical Marketing Men's Health	Coordinator Meetings & Events
	Veldhof, Trudy	Benelux/Leiden		Acct Mgr-Healthcare
010179	Grau,Ryan	CA-SB	Financial Analysis	Analyst, Contracts
	Klausner,Ulrike	Germany		Accountant
001654	Fernandez,Kelly	CA-SB	HC Customer Service	Associate III
	Jongeneel, M.	Benelux/Leiden		Assistant Controller
000812	Plackett,Justin	CA-SB	Surgical Marketing	Associate I
010212	Dayao,Gail	CA-SB	Clinical Studies	Associate Analyst (CRA 1)
004335	Ramos,Erika	CA-SB	HC Customer Service	Associate II
000065	Winningham,Stefanie	OK	Support	Buyer
	Bauer,Angela	Germany		Accountant
	Schouten, Gerard	Benelux/Leiden		Customer Support Manager
003105	Borowski,Gloria	MN	Surgical QC	Quality Inspector II

Seller Listing Schedules

Page 126 of 179

EE ID Name Loc Dept Name Title

020118	Smithson,Matthew B	MN	Healthcare Maintenance	Production Maint Tech III
003515	Smith,Tanya	MN	Document Control	Supervisor RA/QA
002004	McGillivray,Janice	MN	Surgical Mfg Administration	Senior Secretary
003168	Anonthisene,Alex Kay	MN	Healthcare Production	Manufacturing Lead
003322	Lumpkins,Henry	MN	Healthcare Production	Manufacturing Lead
003314	Wilson,Loya	MN	HC Self Cath Production	Manufacturing Lead
010152	Gama,Juanita	CA-SB	Accounts Receivable	Associate III
003991	Arndt,Leisa	MN	Document Control	Documentation Associate
003419	Phaengsy,Xay Ek	MN	Healthcare Maintenance	Production Maint Tech II
003202	Asaad,Rimon	MN	Surgical Mfg Administration	Maintenance Tech I
003516	Blashill,Donald	MN	Warehousing/Distribution	Materials Lead
003725	Lall,Gopaul	MN	Warehousing/Distribution	Materials Lead
004367	Alvaro,Laura	CA-SB	HC Customer Service	Associate II
020115	Kangas,Nathan W	MN	Document Control	Grahics Coordinator
003102	Lang-Khotsombath,Barbara	MN	Surgical QC	Quality Inspector II
003595	Gums,Sandra	MN	Surgical QC	Quality Inspector II
	Hund, Melanie	Benelux/Leiden		Assistant
010169	McHale,Merry S	CA-SB	Accounts Receivable	Associate III
004425	Morse,Laurie	CA-SB	Field Inventory Control	Associate III
009040	Weber,Kellen	MN	Warehousing/Distribution	Materials Clerk II
003963	Maksymovych,Luba	MN	Accounting	Sr Accounting Associate
000086	Horton,Ricky	OK	ISO	Production Technician II
000078	Honigsberg,Christopher S	OK	Production	Production Technician II
005167	Mangue,Josefa	CA-SB	Financial Analysis	Associate II
003251	Melland,Velda	MN	Surgical Implant Production	Manufacturing Lead
009007	Olson,Theresa	MN	HC Self Cath Production	Manufacturing Lead
003228	Henrickson,Kristi	MN	Surgical Implant Production	Surgical Production
003838	Wood,Jennifer	MN	Surgical QC	Quality Inspector II
000838	Strawder,Jan	CA-SB	HC Customer Service	Associate II

Seller Listing Schedules

Page 127 of 179

EE ID Name Loc Dept Name Title

003753	Dowell,Jake L	MN	Facilities	Building Maint Tech II
000085	Lloyd,Shannon	OK	Distribution	Distribution Tech II
003826	Kruger,Travis F	MN	Warehousing/Distribution	Materials Lead
003609	Thao,Pamoua	MN	Warehousing/Distribution	Materials Lead
009093	Atkins,Thomas	MN	Warehousing/Distribution	Materials Clerk II
003447	Schnell,Bradley	MN	Warehousing/Distribution	Materials Clerk II
010244	Llewellyn,Shirley	CA-SB	Surgical Marketing Pelvic	Associate III
009957	Gring,Cheryl	CA-SB	Inside Telesales	Supervisor Inside Sales
010099	Alexander,Dorothy	CA-SB	Surgical Customer Service	Associate II
003304	King,Beverly	MN	Surgical Implant Production	Surgical Production
020084	Varhol,Connie	MN	Surgical QC	Quality Inspector I
020167	Swift,Desiree	MN	Surgical Implant Production	Manufacturing Lead
003978	Heng,Dy	MN	Surgical Implant Production	Surgical Production
	Sommer, Welmoed	Benelux/Leiden		Sales Rep Healthcare
020142	Wilcox,Heidi	MN	Product Evaluation	Specialist
020063	Brandenburg,Sharen	MN	Healthcare Mfg Admin	Secretary
010236	Suryadi,Sylvia	CA-SB	Field Inventory Control	Associate III
010300	Clark,Steven	CA-SB	Field Inventory Control	Associate III
020029	Doss,Tina M	MN	Surgical Implant Production	Manufacturing Lead
010316	Cory,Steven	CA-SB	Accounts Receivable	Associate III Interim
003581	Robinson,Jonathon	MN	Warehousing/Distribution	Materials Clerk I
003654	Karadza,Drashko	MN	Surgical QC	Quality Inspector I
000088	Albert,Rachel L	OK	Document Control	Document Control Assoc II
000109	Wells,Brad T	OK	Quality	QC Technician II
000099	Knighton,Debra J	OK	Support	Accounting Associate II
020076	Sedlock,Mary Jo	MN	Surgical Implant Production	Surgical Production
003600	Boudreaux,Charlzetta	MN	Surgical Implant Production	Surgical Production
003984	Johnson,Thomas	MN	Surgical Implant Production	Surgical Production

Seller Listing Schedules

Page 128 of 179

EE ID Name Loc Dept Name Title

020147	Lonsky,Sarah	MN	Human Resources	HR Associate
003616	Vu,Lan	MN	HC Self Cath Production	Mfg Technician I
003722	Zorgbo,Isaac	MN	Accounting	Accounting Associate
004030	Gbalah,Saye	MN	Surgical Implant Production	Surgical Production
003498	McCabe,Etta	MN	Surgical Implant Production	Surgical Production
003948	Nguyen,Nhon	MN	Surgical Implant Production	Manufacturing Lead
003599	Keomaniphone,Ketmany	MN	Surgical QC	Quality Inspector I
010311	Jaremka,Jeremy	CA-SB	Field Inventory Control	Associate I Interim
003170	Khamsot,Bounmak	MN	Healthcare Production	Packaging Machine Operator
020005	Vang,Nancy	MN	Advanced Manufacturing	Documentation Associate
003233	Smith,Romelle	MN	Healthcare Production	Packaging Machine Operator
003411	Lor,Ker	MN	Surgical QC	Quality Inspector I
009099	Thammavongsa,Kham	MN	Healthcare Production	Packaging Machine Operator
003893	Yang,Toua	MN	Healthcare Production	Manufacturing Lead
009089	Phiphak,Saveng	MN	Surgical Implant Production	Surgical Production
000101	Caskey,Robert B	OK	Distribution	Distribution Technician
000094	Long,Rosie D	OK	Distribution	Distribution Technician
003326	Lumpkins,Mary	MN	HC Self Cath Production	Self Cath Production
003932	Doriott,Roxann M	MN	Surgical Implant Production	Surgical Production
010301	Angelos,Julie	CA-SB	Inside Telesales	Assoc Inside TeleSales
010098	Macleod,Andra	CA-SB	Inside Telesales	Assoc Inside TeleSales
003219	Phongsavath,Monexay	MN	HC Self Cath Production	Self Cath Production
003691	Brever,Joel	MN	Warehousing/Distribution	Materials Clerk I
003943	Browning,Raymond	MN	Warehousing/Distribution	Materials Clerk I
020038	Eckenrode,Valerie	MN	Warehousing/Distribution	Customer Serv. Liason
003301	Winebrenner,Sidney	MN	Healthcare Production	Packaging Machine Operator
003327	Miller,Donna	MN	HC Self Cath Production	Self Cath Production
000107	Woodring,Patti J	OK	ISO	Production Technician
000111	Barnes,Michael R	OK	Quality	QC Technician

Seller Listing Schedules

Page 129 of 179

EE ID Name Loc Dept Name Title

003690	Ly,Kongpheng	MN	HC Self Cath Production	Manufacturing Lead
003236	Savatdy,Kong Keo	MN	Healthcare Production	Packaging Machine Operator
000120	Owens,Melinda P	OK	Support	Inventory Control Associate
003268	Hellert,Peggy	MN	Healthcare Production	Packaging Machine Operator
003367	Rajphangthong,Kim Tien	MN	Healthcare Production	Packaging Machine Operator
003081	Vongphrachanh,Sengthong	MN	Healthcare Production	Packaging Machine Operator
020105	Singh,Karnail	MN	Lubricious Catheter Production	Lubricious Catheter
003373	Phoutthaphaphone,Khambo	MN	HC Self Cath Production	Self Cath Production
003334	Rychtarczyk,Janina	MN	HC Self Cath Production	Self Cath Production
003459	Saleum,Manykhone	MN	HC Self Cath Production	Self Cath Production
003398	Sythalath,Aaron	MN	HC Self Cath Production	Self Cath Production
009081	Thammavongsa,Khamlome	MN	HC Self Cath Production	Hand Assembly
003692	Hebzynski,Steven	MN	Warehousing/Distribution	Materials Clerk I
003381	Vang,Ka	MN	HC Self Cath Production	Self Cath Production
003582	Xayana,Bouakeo	MN	HC Self Cath Production	Self Cath Production
	Teig, M. Y.	Benelux/Leiden		Purchaser
004008	Warren,Patricia	MN	Surgical Implant Production	Surgical Production
003329	Nielsen,Janice	MN	HC Self Cath Production	Hand Assembly
003503	Sphabmixay,Pam	MN	HC Self Cath Production	Self Cath Production
004001	Ali,Ahmedyassin	MN	HC Self Cath Production	Extruder Operator
020112	Mims,Darnell	MN	Healthcare Production	Packaging Machine Operator
003945	Yemane,Cherinet	MN	Surgical Implant Production	Surgical Production
010299	Alvaro,Teresa	CA-SB	Surgical Customer Service	Associate I
000068	Zeller,Debra M	OK	Quality	QC Technician
003235	Vongphrachanh,Sayamphone E	MN	Healthcare Production	Packaging Machine Operator
003355	Sirimanothay,Khamsy	MN	Healthcare Production	Packaging Machine Operator
003999	Naovaraj,Saysomphou P	MN	Surgical Implant Production	Surgical Production
003734	Xiong,Peter	MN	Healthcare Production	Packaging Machine Operator
010071	Garcia,Felicia	CA-SB	Clinical Studies	Associate I

Seller Listing Schedules

Page 130 of 179

EE ID Name Loc Dept Name Title

003366	Boudsavath,Ketmany	MN	Healthcare Production	Packaging Machine Operator
003822	Inthichack,Lattana L	MN	Surgical Implant Production	Surgical Production
003618	Laurich,Luz	MN	Surgical Implant Production	Surgical Production
003998	Moua,Yang	MN	Surgical Implant Production	Surgical Production
003585	Booker,Vernoise	MN	Healthcare Production	Packaging Machine Operator
003790	Han,Amy S	MN	HC Self Cath Production	Self Cath Production
020037	Sorenson,LaVonne	MN	Surgical Implant Production	Surgical Production
000135	Weaver,Scott D	OK	Production	Production Technician
003680	Marial,Kuei	MN	Healthcare Production	Packaging Machine Operator
003443	Nelson Dahl,Ramona	MN	Healthcare Production	Packaging Machine Operator
003469	Phonseya,Haikham	MN	Healthcare Production	Packaging Machine Operator
003738	Thao,Shoua Y	MN	HC Self Cath Production	Self Cath Production
003352	Vilaysane,Phetkesone	MN	HC Self Cath Production	Self Cath Production
020028	Phommachack,Thongla	MN	Healthcare ADL Production	ADL Operator
020061	Chanthapanya,Gerry	MN	Healthcare ADL Production	ADL Operator
003588	Plair,Andra	MN	Healthcare Production	Packaging Machine Operator
020018	Tran,Cindy	MN	Surgical Implant Production	Surgical Production
020078	Imsdahl,Ronda	MN	Healthcare Production	Packaging Machine Operator
020012	Legesse,Mohamed	MN	HC Self Cath Production	Extruder Operator
003875	Ratrisavath,Viengsavanh	MN	HC Self Cath Production	Self Cath Production
020048	Yang,Pao	MN	Lubricious Catheter Production	Lubricious Catheter
020069	Moua,Hueseng	MN	Surgical Implant Production	Surgical Production
003863	Rychtarczyk,Boguslawa H	MN	HC Self Cath Production	Self Cath Production
000114	Barber,Tina M	OK	Production	Production Technician
020024	Buie,Mitiku	MN	Warehousing/Distribution	Materials Clerk I
020102	Xiong,Yee	MN	Surgical Implant Production	Surgical Production
003982	Rydh,Cara J	MN	HC Self Cath Production	Self Cath Production

Seller Listing Schedules

Page 131 of 179

EE ID Name Loc Dept Name Title

020152	Mayotte,Jarrid	MN	Warehousing/Distribution	Materials Clerk I
003944	Hassan,Burhan	MN	Healthcare Production	Packaging Machine Operator
020083	Abdullahi,Gonje	MN	Surgical Implant Production	Surgical Production
020100	Yang,Shoua	MN	Healthcare Production	Packaging Machine Operator
003996	Polliard,Miranda	MN	HC Self Cath Production	Self Cath Production
020098	Vang,Mai Vu	MN	HC Self Cath Production	Self Cath Production
003898	Thongdy,Khamvath	MN	Healthcare Production	Packaging Machine Operator
003807	Hicks,Carolyn Y	MN	Healthcare Production	Packaging Machine Operator
010166	Cordeiro,Ritchie	CA-SB	Lit & Convention Services	Associate I
003926	Saleum,Deng	MN	HC Self Cath Production	Self Cath Production
020129	Fogarty,Patrick H	MN	Surgical Implant Production	Surgical Production
020130	Vue,Mee	MN	Surgical Implant Production	Surgical Production
020136	Yang,Fue	MN	Surgical Implant Production	Surgical Production
020127	Lee,Phong	MN	Healthcare ADL Production	ADL Operator
003847	Bounchanh,Matsa	MN	HC Self Cath Production	Self Cath Production
003925	Said,Muqtar	MN	HC Self Cath Production	Self Cath Production
003810	Phommachanh,Danny	MN	Healthcare Production	Packaging Machine Operator
003536	Keovongsa,Khampounh	MN	HC Self Cath Production	Self Cath Production
020009	Vang,KC	MN	HC Self Cath Production	Self Cath Production
004028	Vue,Mao	MN	HC Self Cath Production	Self Cath Production
003874	Douangchanh,Keo	MN	HC Self Cath Production	Self Cath Production
003876	Ratrisavath,Tippy M	MN	HC Self Cath Production	Self Cath Production
003742	Munkhamxang,Toune	MN	HC Self Cath Production	Self Cath Production
020125	Lee,Pheng	MN	HC Self Cath Production	Extruder Operator
020064	Chang,Tsia	MN	Lubricious Catheter Production	Lubricious Catheter
004023	Hersi,Nasra	MN	Healthcare Production	Packaging Machine Operator
003605	Taylor,Diane	MN	Healthcare ADL Production	Superfreedom Operator
003527	Zimmerman,D. Wayne	MN	Healthcare ADL Production	Superfreedom Operator
003931	Boudsavath,Vyraphanh	MN	Healthcare Production	Packaging Machine Operator

Seller Listing Schedules

Page 132 of 179

EE ID Name Loc Dept Name Title

004004	Farah,Ahmed	MN	HC Self Cath Production	Self Cath Production
003848	Sphabmixay,Phanmalay	MN	HC Self Cath Production	Self Cath Production
003968	Mohamed,Khadija	MN	Healthcare Production	Packaging Machine Operator
020144	Garcia,Robert P	MN	Surgical Implant Production	Surgical Production
020143	Stern,Betty J	MN	Surgical Implant Production	Surgical Production
004009	Yang,Ia	MN	Healthcare Production	Packaging Machine Operator
003794	Conway,Faith A	MN	Lubricious Catheter Production	Lubricious Catheter
020043	Vang,Moua	MN	Healthcare Production	Packaging Machine Operator
004027	Osman,Mawlid	MN	HC Self Cath Production	Self Cath Production
004000	Xayana,Sunun	MN	HC Self Cath Production	Self Cath Production
003936	Forbes,Sophia	MN	Healthcare Production	Packaging Machine Operator
003976	Mohamed,Sitti	MN	HC Self Cath Production	Self Cath Production
003901	Mohammed,Tajer	MN	Healthcare Production	Packaging Machine Operator
020006	Barway,Leo J	MN	Healthcare Production	Packaging Machine Operator
020169	Johnson,Michealadam	MN	Healthcare ADL Production	ADL Operator
020139	Adem,Hassan	MN	Surgical Implant Production	Surgical Production
020133	Xiong,Kao	MN	Surgical Implant Production	Surgical Production
020176	Xiong,Song	MN	HC Self Cath Production	Extruder Operator
020103	Thompson,Michael	MN	Healthcare Production	Packaging Machine Operator
020086	Xiong,Hmong	MN	Healthcare Production	Packaging Machine Operator
020059	Ali,Fardowsa	MN	HC Self Cath Production	Self Cath Production
020065	Ongou,Alexander	MN	HC Self Cath Production	Self Cath Production
020050	Johnson,Deborah	MN	HC Self Cath Production	Self Cath Production
020151	Holte,Deborah	MN	Surgical Implant Production	Surgical Production
020173	Yang,Pao	MN	Surgical Implant Production	Surgical Production
004021	Mohammed,Kimia	MN	HC Self Cath Production	Self Cath Production
020053	Bates,Toshia	MN	HC Self Cath Production	Self Cath Production

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EE ID Name Loc Dept Name Title

020056	Florence,Jason	MN	HC Self Cath Production	Self Cath Production
020060	Guure,Kiin	MN	HC Self Cath Production	Self Cath Production
020081	Elmi,Ahmed	MN	HC Self Cath Production	Self Cath Production
020096	Stafin,Krystyna	MN	HC Self Cath Production	Self Cath Production
020058	Phothirath,Phetsovanh	MN	HC Self Cath Production	Self Cath Production
020054	Salaam,Ronald	MN	HC Self Cath Production	Self Cath Production
020087	Siharath,Soutthanary	MN	HC Self Cath Production	Self Cath Production
020123	Hansch,Joy A	MN	Healthcare Production	Packaging Machine Operator
020040	Teague,Deborah	MN	Healthcare Production	Packaging Machine Operator
020110	Woods,Jermaine	MN	HC Self Cath Production	Self Cath Production
	Krijgsman, P.	Benelux/Leiden		Customer Support Healthcare
020109	Xiong,Thai	MN	Healthcare Production	Packaging Machine Operator
020111	Aspelund,Christopher	MN	HC Self Cath Production	Self Cath Production
020106	Vang,Mai	MN	HC Self Cath Production	Self Cath Production
020124	Hassan,Shafik	MN	HC Self Cath Production	Self Cath Production
020121	Severson,Joshua E	MN	HC Self Cath Production	Self Cath Production
020138	Lee,Tou	MN	HC Self Cath Production	Self Cath Production
020145	Xiong,Chiang	MN	HC Self Cath Production	Self Cath Production
020162	Lee,Xee	MN	Healthcare ADL Production	Superfreedom Operator
020148	Her,Maoh	MN	Lubricious Catheter Production	Lubricious Catheter
020164	Moua,Long	MN	Healthcare Production	Packaging Machine Operator
020157	El-Hage,Fernando	MN	Lubricious Catheter Production	Lubricious Catheter
020170	Weldesenbet,Abdi	MN	Healthcare ADL Production	Superfreedom Operator
020165	Olsen,Eric W	MN	HC Self Cath Production	Self Cath Production
020174	Wolobah,Emily	MN	HC Self Cath Production	Self Cath Production
003552	Thongrasmy,Kaenchanh	MN	HC Self Cath Production	Self Cath Production
	van Helden, Sergio Lopez	Benelux/Leiden		Customer Support -Healthcare
000134	Oliver,Clara R	OK	Support	Custodian
003805	Kornhauser,Linda S	MN	Warehousing/Distribution	Mail Sorter
	Schipper,Natasja	Benelux/Leiden		Customer Support Healthcare
	Foster,Nicole	CA-SB	Accounting	Agency Temp Employee
	Durchslag-Richardson,Tyler	CA-SB	Field Inventory Control	Agency Temp Employee

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Transferred Sub Location - Japan

Name	Location	Position
Hinata Minoru	Porges Japan	Area Manager
Ikeo Norihiro	Porges Japan	Sales Rep
Iwamori Jun	Porges Japan	Sales Director
Kawahara Kazuhiro	Porges Japan	Area Manager
Kawasaki Keita	Porges Japan	Sales Rep
Koga Mizuho	Porges Japan	Sales Rep
Kyono Kiyomichi	Porges Japan	Quality Insurance Controller
Nishi Miyuki	Porges Japan	Safety controller, Product Manager
Nishimura Manabu	Porges Japan	Sales Rep
Ogura Atsuya	Porges Japan	Total QA Controller
Omura Noboru	Porges Japan	Sales Rep
Tabuchi Masako	Porges Japan	Customer Service
Takagi Kazuya	Porges Japan	Sales Rep
Umeda Mitsuzo	Porges Japan	Representative Director
Yamada Kumi	Porges Japan	Customer Service

Transferred Sub Location - Canada

Name	Location	Position
Desjardins,Beau	Canada	Sales Uro
Donchegay,Laurent	Canada	Sales Uro
Leroux,Norm	Canada	Sales Uro
O'Connell,Troy	Canada	Sales Uro
Stephens,David	Canada	Sales Uro

Transferred Sub Locations - EU

In accordance with European Union Directive 95/46/EC on the protection of individuals with regard to processing personal data and the free movement of such data, Seller is restricted from transferring personal data from an EU Member State to countries outside of the EU where the legal regime does not ensure an adequate level of privacy protection for individuals. Seller does not subscribe to the required principles under the Directive to allow Seller to transfer personal data as required by the safe harbor privacy principles issued by the U.S. Department of Commerce. As such, full employee lists will be provided at each European Union location to comply with these stringent privacy laws.

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Dept Title

Australia	Sales Manager
Belgium-Mechelen	Manager
Belgium-Mechelen	Internal Sales Force
Belgium-Mechelen	Internal Sales Force
Belgium-Mechelen	Sales Administration
Belgium-Mechelen	Sales Administration
Belgium-Netherlands	Internal Sales Force
Colchester	Site Keeper
France	Attaché commercial
France	Assistante de direction
France	Délégué Techni comm
France	Attaché techni commercial
France	Attaché techni commercial
France	Assistante commerciale
France	Assistante commerciale
France	Gestionnaire Administratif
Italy Porges	Manager
Italy Porges	Area Manager
Italy Porges	Area Manager
Italy Porges	Area Manager
Italy Porges	Area Manager
Italy Porges	Office Manager
Italy Porges	Product Specialist
Italy Porges	Customer Service Manager
Italy Porges	Marketing/Secretary
Italy Porges	Customer Service
Italy Porges	Customer Service
Italy Porges	Customer Service
Italy Porges	Customer Service
Italy Porges	Customer Service
Lancing	Managing Director

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Dept Title

Lancing	Accounts Controller
Lancing	Marketing Manager
Lancing	Sales Manager
Lancing	Human Resources Manager
Lancing	Technical Manager
Lancing	Development Engineering Manager
Lancing	It Manager
Lancing	Factory Manager
Lancing	Cost Accountant
Lancing	Nursing Advisor
Lancing	Sales Specialist
Lancing	Territory Manager (Sales)
Lancing	Project Manager
Lancing	It & Communications Specialist
Lancing	Sales Specialist
Lancing	Sales Specialist
Lancing	Sales Specialist
Lancing	Sales Specialist
Lancing	Purchasing Manager
Lancing	Nursing Advisor
Lancing	Sales Specialist
Lancing	Sales Specialist
Lancing	Sales Specialist
Lancing	Sales Specialist
Lancing	Financial Accountant
Lancing	Quality Assurance Manager
Lancing	Engineering Manager
Lancing	Production Planner
Lancing	Distribution Manager
Lancing	Sales Specialist
Lancing	Production Support Engineer
Lancing	Production Setter
Lancing	Technician/Setter
Lancing	Specifications Officer
Lancing	Sales Specialist
Lancing	Purchasing Manager
Lancing	Pa To Managing Director
Lancing	Sales Administrator
Lancing	Sales Administrator

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Dept Title

Lancing	Stock Auditor
Lancing	Assistant Accountant
Lancing	Development Technician
Lancing	Production Supervisor
Lancing	Production Supervisor
Lancing	Ar/Ap Administrator
Lancing	Quality Assurance Assistant
Lancing	Setter/Operator
Lancing	Acting Manager Customer Service
Lancing	Senior Customer Service Advisor
Lancing	Sales Update Administrator
Lancing	Senior Customer Service Advisor
Lancing	Ar/Ap Accountant
Lancing	Human Resources Administrator
Lancing	Accounts Payable Co-Ordinator
Lancing	Quality Assurance Technician
Lancing	Purchasing Assistant
Lancing	Quality Assurance Administrator
Lancing	Technical Assistant
Lancing	Warehouse Supervisor
Lancing	Customer Service Advisor
Lancing	Purchasing Assistant
Lancing	Process Operator
Lancing	Prescriptions Co-Ordinator
Lancing	Process Setter/Technician
Lancing	Customer Service Advisor
Lancing	Factory Assistant
Lancing	Warehouse Person
Lancing	Warehouse Person
Lancing	Distribution Co-Ordinator
Lancing	Warehouse Person
Lancing	Warehouse Person
Lancing	Stockkeeper/Driver
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Warehouse Person
Lancing	Warehouse Person
Lancing	Warehouse Person
Lancing	Warehouse Person

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Dept Title

Lancing	Warehouse Person
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Warehouse Operative
Lancing	Warehouse Person
Lancing	Warehouse Person
Lancing	Warehouse Person
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Factory Assistant
Lancing	Maintenance Assistant
Mentor Italy	Controller
Mentor Spain	Controller
Porges France	Manager
Porges France	Manager
Porges France	Manager
Porges France	Manager
Porges France	Manager
Porges France	Manager
Porges France	Manager

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Dept Title

Porges France	Manager
Porges France	Manager
Porges France	Manager
Porges France	Directeur Assurance Qualite
Porges France	Resp Gestion Industrielle
Porges France	Resp Conditionnement
Porges France	Directeur De Production
Porges France	Directeur Du Dvlpmt Commercial
Porges France	Responsable Affaires Reglement
Porges France	Directeur Marketing-Ventes Had
Porges France	Directeur Achats Porges Sas
Porges France	Resp Lignes Silicone/Dormia
Porges France	Dir Commercial Urologie France
Porges France	Directeur D'etablissement
Porges France	Resp Du Service Commercial
Porges France	Chef De Marche
Porges France	Chef De Marche
Porges France	Specialiste Produit
Porges France	Responsable De Zone
Porges France	Chef De Projet
Porges France	Responsable Recherches Et Dev
Porges France	Resp Qualite Prod S/Traitance
Porges France	Directeur Des Ventes
Porges France	Resp De Ligne Prod Latex/Kd
Porges France	Dir Regional Des Ventes
Porges France	Responsible Conso Et Reporting
Porges France	Resp Indust/Entret-Trav Neufs
Porges France	Controleur De Gestion Industri
Porges France	Ingenieur Conseil
Porges France	Specialiste Produit
Porges France	Dir Regional Des Ventes
Porges France	Chef De Marche
Porges France	Administrateur Reseaux Et Syst
Porges France	Chef De Projet Developpement
Porges France	Attache Technico-Commercial
Porges France	Responsable D'application
Porges France	Respons Relations Professionn
Porges France	Administrateur Donnees Commerc
Porges France	Ingenieur Developpement

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Dept Title

Porges France	Resp Paie Et Adminis Personnel
Porges France	Acheteur
Porges France	Controleur De Gestion
Porges France	Attache Technico-Commercial
Porges France	Responsable D'ilots
Porges France	Responsable Controle Qualite
Porges France	Att Rech Clinique-Att Scientif
Porges France	Attache Technico-Commercial
Porges France	Resp Paye Et Adm Du Personnel
Porges France	Responsable Atelier
Porges France	Resp Unite De Fabrication
Porges France	Responsable D'ilot
Porges France	Responsable Cellule R D
Porges France	Assistante Direction Bilingue
Porges France	Resp Maintenance Ent Tx Neufs
Porges France	Attache Technico-Commercial
Porges France	D A O
Porges France	Chef De Projet R & D
Porges France	Resp Unite De Fabrication
Porges France	Attache Technico-Commercial
Porges France	Chef De Projet R Et D
Porges France	Resp Regional Des Ventes
Porges France	Attache Technico-Commercial
Porges France	Attache Technico-Commercial
Porges France	Assistante Ressources Humaines
Porges France	Attache Technico Commercial
Porges France	Chef De Projet Fonctionnel
Porges France	Attache Technico-Commercial
Porges France	Acheteur
Porges France	Responsable Ilot Kd/Magasin
Porges France	Assistante De Direction
Porges France	Gestionnaire Export
Porges France	Technicien Support
Porges France	Expert Fonctionnel I T
Porges France	Attache Technico Commercial
Porges France	Attache Technico-Commercial
Porges France	Attache Technico Commercial
Porges France	Acheteur
Porges France	Responsable Adv Serv Commandes

Seller Listing Schedules

Page 141 of 179

Dept Title

Porges France	Gestionnaire Export
Porges France	Resp Assurance Qualite Retd
Porges France	Attache Technico Commercial
Porges France	Technicienne Achats
Porges France	Attache Technico-Commercial
Porges France	Assistant Controleur Indust
Porges France	Responsable De Publication
Porges France	Resp Qualite Junior Dist/Audit
Porges France	Controleur De Gestion
Porges France	Gestionnaire Export
Porges France	Technicien Support
Porges France	Attache Technico-Commerc H/C
Porges France	Tech En Metrologie
Porges France	Assistante Directeur Ventes Hc
Porges France	Gestionnaire Ordonnancement
Porges France	Secretaire
Porges France	Assistant De Direction
Porges France	Attache Technico-Commercial
Porges France	Medecin Materio Vigil Et R Cl
Porges France	Attache Technico Commercial
Porges France	Attache Technico Commercial
Porges France	Attache Technico-Commercial
Porges France	Assistant De Gestion
Porges France	Agent De Maitrise
Porges France	Attache Technico Commercial
Porges France	Gestionnaire Export
Porges France	Attache Technico-Commercial
Porges France	Attaché Techni Commercial
Porges France	Technicien Recherches Develop
Porges France	Controle Qualite Mat Prem
Porges France	Chef De Groupe
Porges France	Dessinateur
Porges France	Assist De Direction Trilingue
Porges France	Technicien
Porges France	Assistante De Gestion Admin
Porges France	Secretaire Trilingue
Porges France	Dessinateur
Porges France	Tech En Metrologie

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Dept Title

Porges France	Gestionnaire Administratif
Porges France	Gestionnaire Administratif
Porges France	Secretaire Bilingue
Porges France	Assistante De Gestion
Porges France	Technicien
Porges France	Technicien
Porges France	Assistante Bilingue
Porges France	Technicien
Porges France	Agent De Maitrise
Porges France	Technicien
Porges France	Technicien
Porges France	Gestionnaire Administratif
Porges France	Gestionnaire Export
Porges France	Technicien
Porges France	Technicien
Porges France	Tech De Maintenance
Porges France	Technicien De Maintenance
Porges France	Technicien
Porges France	Chef De Produit-Assis Conseil
Porges France	Technicien
Porges France	Gestionnaire Administratif
Porges France	Technicien
Porges France	Comptable-Comptabilites Auxili
Porges France	Chimiste
Porges France	Agent De Gestion
Porges France	Agent De Gestion
Porges France	Technicien
Porges France	Technicien
Porges France	Resp Reclamations Clients
Porges France	Agent De Maitrise
Porges France	Comptable Compta Auxiliaire
Porges France	Comptable Client
Porges France	Gestionnaire Administrative
Porges France	Acheteur
Porges France	Gestionnaire Administratif
Porges France	Agent De Gestion
Porges France	Gestionnaire Administratif
Porges France	Technicien De Maintenance
Porges France	Technicien

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Dept Title

Porges France	Technicien R D
Porges France	Technicien De Maintenance
Porges France	Gestion Adm Centrale Exped
Porges France	Magasinier
Porges France	Agent Administratif Cqap
Porges France	Technicien
Porges France	Technicien
Porges France	Technicien De Maintenance
Porges France	Technicien R D
Porges France	Technicien Recherche Et Devel
Porges France	Employe Administratif
Porges France	Agent D'approvisionnement
Porges France	Magasinier
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Technicien
Porges France	Employe De Stock
Porges France	Gestionnaire Stocks
Porges France	Ouvrier De Fabrication
Porges France	Preparatrice De Commandes
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Technicien
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Gestionnaire Administrative
Porges France	Magasinier
Porges France	Agent De Gestion
Porges France	Gestionnaire Administratif
Porges France	Gestionnaire Administratif
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication

Seller Listing Schedules

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Dept Title

Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Laborantin
Porges France	Agent De Gestion
Porges France	Magasinier
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Gestionnaire Administratif
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Magasinier
Porges France	Preparatrice De Commandes
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Hotesse Standardiste
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Magasinier
Porges France	Preparatrice De Commandes
Porges France	Ouvrier De Fabrication

Seller Listing Schedules

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Dept Title

Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Preparatrice De Commandes
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Magasinier - Cariste
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Agent De Gestion
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Laborantin
Porges France	Ouvrier De Fabrication
Porges France	Preparateur De Commande
Porges France	Preparateur De Commandes
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Preparateur Commandes
Porges France	Ouvrier De Fabrication
Porges France	Preparateur Commande
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication

Seller Listing Schedules

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Dept Title

Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Preparateur De Commandes
Porges France	Preparateur De Commandes
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Laborantin
Porges France	Magasinier Reapprovisionnement
Porges France	Ouvrier De Fabrication
Porges France	Magasinier
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication

Seller Listing Schedules

Page 147 of 179

Dept Title

Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Magasinier
Porges France	Magasinier
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication

Seller Listing Schedules

Page 148 of 179

Dept Title

Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Secretaire Bilingue
Porges France	Preparatrice De Commandes
Porges France	Assistante Bilingue
Porges France	Infirmiere
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Controleur
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Ouvrier De Fabrication
Porges France	Contrat Apprentis Ingenieur
Porges Germany	Manager
Porges Germany	Manager
Porges Germany	Manager
Porges Germany	Manager
Porges Germany	Regional Sales Manager
Porges Germany	Product Manager
Porges Germany	Sales Representative
Porges Germany	Office Manager
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Customer Service
Porges Germany	Sales Representative
Porges Germany	Marketing Assistant
Porges Germany	Sales Representative

Seller Listing Schedules

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Dept Title

Porges Germany	Customer Service
Porges Germany	Customer Service
Porges Germany	Customer Service
Porges Germany	Customer Service
Porges Germany	Customer Service
Porges Germany	Sales Representative
Porges Germany	Customer Service
Porges Germany	Sales Representative
Porges Germany	Sales Representative
Porges Germany	Customer Service
Porges Germany	Sales Representative
Porges Germany	Product Manager
Porges Germany	Customer Service
Porges Germany	Sales Representative
Porges Germany	Customer Service
Porges Germany	Customer Service
Porges Italy	Customer Service
Porges Italy	Customer Service
Spain Uro	Sales Manager
Spain Uro	Sales Manager
Spain Uro	Regional Sales Manager
Spain Uro	Sales Representative
Spain Uro	Sales Representative
Spain Uro	Office Manager
Spain Uro	Sales Representative
Spain Uro	Customer Service
Spain Uro	Sales Representative
Spain Uro	Sales Representative
Spain Uro	Customer Service
Spain Uro	Customer Service
Spain Uro	Customer Service
Spain Uro (Portugal)	Branch Manager
Spain Uro (Portugal)	Sales Representative
Spain Uro (Portugal)	Office Manager
Spain Uro (Portugal)	Sales Representative
Spain Uro (Portugal)	Customer Service

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Schedule 8.2(a)

Exceptions to Conducting Business in Ordinary Course

1.  ICX Modular Coating Line and Pallets - Implementation of Hydrophilic Catheter Coating System at Minneapolis facility. (Current estimated project cost is $825,000)

2.  Acquisition of two automated catheter tubing loader machines in Minnesota - Implement system to implement automatic loading of AutoCath machines. (Current estimated project cost is $190,000)

3.  Consulting project to train and implement Demand Flow Technology in Minnesota - Increase manufacturing capacity and reduce cost in Self-Cath and IPP product lines by implementing demand flow procedures. (Current estimated project cost is $186,000)

4.  Packaging automation project in Sarlat, France. (Current estimated project cost is $450,000)

5.  Extruder Puller / Cutter - to enhance capacity of PVC Extruder in Minnesota (Current estimated project cost is $212,000).

6.  Silicone Foley Cost Reduction, which may include a packaging automation component (Current estimated project cost is approximately $700,000).

7.  Notwithstanding anything to the contrary in the Agreement, Seller shall take whatever actions are necessary and proper to remove any and all Excluded Assets from any of the Transferred Subsidiaries and to satisfy any intercompany obligations involving any one or more of the Transferred Subsidiaries.

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Schedule 8.2(b)

Exceptions to Taking of Prohibited Actions

Purchase Agreement Number 729 between Healthtrust Purchasing Group and Mentor Corporation dated December 1, 2002 and amended February 1, 2003, November 1, 2004, June 24, 2005, November 30, 2005, and February 3, 2006, will terminate as of March 31, 2006.  Seller currently contemplates that on or around the date of termination of such agreement, Seller and Healthtrust Purchasing Group will enter into a new dual-source arrangement.

Execution and delivery of new leases for premises located at Unit 6 (K+M), Peter Road, Lancing, United Kingdom, and Unit 9, Peter Road, Lancing, United Kingdom.

Seller is negotiating a severance agreement with Richard Grugeaux. Any severance provided under such agreement will be paid by Seller.

As of April 1, 2006, all U.S. non-sales employees will receive a 2% salary increase.

Seller intends to increase the compensation available under the Sales Compensation Plan for fiscal year 2007 as of April 1, 2006. The increase in compensation will be consistent with past practice, and will consist of approximately $100,000 in aggregate salary increases and approximately $500,000 in aggregate variable compensation, with the aggregate increase in compensation not to exceed $650,000. Details are still being negotiated and Seller will provide further information as it becomes available.

Seller intends to update any outstanding retention/execution letters to reflect the later closing date of the transaction. The amount and terms granted pursuant to such retention/execution letters will not change (other than the inclusion of the later closing date).

Seller currently contemplates entering into an Agency Agreement with Anderson Jones.

Seller intends to enter into an amendment to the lease for 1401 West River Road, Minneapolis, Minnesota, consistent with the terms outlined in that certain Proposal for Lease dated April 10, 2006.

See open projects described in Items 1, 4 and 6 of Schedule 8.2(a).

See Item 7 of Schedule 8.2(a).

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Schedule 8.17(b)

Summary of Space Sharing Terms

301 Mentor Drive

Santa Barbara, CA 93111

CATEGORY PROPOSAL

Direction of Space Sharing:	Seller to provide space to Buyer (2nd Floor 301 Office)
Sublandlord:	Mentor Corporation
Subtenant:	Buyer
Sublease Premises:	301 Mentor Drive 2nd Floor Office Space shown on attached floor plan; provided, however, that Mentor shall have the right to retain and separate from the remainder of the sublease space an area consisting of approximately 1,000 to 2,000 square feet of contiguous space in a location to be determined. [Warehouse Space to be determined]
Size:	~ 12,620 usable sf Office Space, subject to compliance with applicable laws and permitting requirements.
Floor plan:	See attached floor plans
Separation/Condition of Premises:	Alterations and improvements may be required to prepare the Sublease Premises for occupancy and to prepare replacement premises for the current employees located in the Sublease Premises. Such alterations and improvements include, without limitation, (i) installing a separate security system in the Sublease Premises and (ii) installing a phone system, if required. Such alterations and improvements shall be performed by Mentor at the Subtenant’s cost and expense.
Relocation requirements:	Mentor personnel currently occupying Sublease Premises must be relocated from the Sublease Premises. Relocation will take approximately 30-90 days.
Term:	Twelve (12) months.
Extension option:	Two (2) options to extend for six (6) months each upon not less than four (4) months advance written notice to Mentor.

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CATEGORY PROPOSAL

Early termination right:	Subtenant shall have a one-time right to surrender all or a portion of the 2,770 sq.ft area identified in light grey on the attached floor plan. Subtenant shall notify Mentor within the first 2 months of the sublease term of such portion of the Sublease Premises that subtenant wishes to surrender in accordance with the foregoing sentence and the effective date of such reduction shall be the first day of the six month of the sublease term. Details regarding the required amount of advance written notification and other requirements shall be identified in the final sublease. In all events, the foregoing right shall be subject to applicable law and permit requirements.
Shared Areas:
Reception/Lobby:	Yes, located on first floor entrance. Currently, there is no receptionist in the lobby area, and, accordingly, any receptionist located in that area would be at subtenant’s cost.
Copy/Fax Rooms:	Included within Office Space.
Kitchen/Break Areas:	Included in Office Space. Subtenant shall also be granted access to the first floor cafeteria.
Conference Rooms:	[To be determined]
Mailrooms:	Subtenant shall not have access to any mailrooms and will need to arrange for post office pickup of mail.
Utility rooms:	Yes, located outside of Sublease Premises.
Shipping & receiving:	No.
Elevator:	Yes.
Stairwells:	Yes.
Restrooms:	Yes, located outside of Sublease Premises.

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CATEGORY PROPOSAL

Rent:	Office Space Subtenant shall pay its proportionate share of all of the costs and expenses paid by Mentor with respect to the Subleased Premises, approximately $2.28 per rentable sq.ft. plus overhead costs. Furnishings To be priced separately. Utilities Utilities (power, electrical, water, HVAC) are not included and will be charged as a pro rata share of Mentor’s actual costs.
Services:
Receptionist services:	To be determined and priced as a separate transition service. Currently there is no receptionist in the lobby area.
Mailroom services:	None.
Janitorial:	Buyer to contract with Mentor’s janitorial service vendor.
Security:	Security system to be installed and operated by Mentor.
Repair Obligations	To be determined consistent with other Subleases in the building.
Furniture & Equipment:	Space is provided furnished with desks, cubicles and limited file cabinet storage to be leased at a separate monthly charge per square foot to be negotiated. Chairs are not currently part of the furnished office space and will need to be provided by subtenant.
Parking:	Pro rata share of onsite parking included.
Signage:	No signage

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Schedule 8.21

Environmental Insurance

The Environmental Insurance Policy (“EIP”) will provide coverage for bodily injury, property damage and remediation costs for pre-existing pollution incidents and new pollution incidents. The EIP length is 10 years for pre-existing incidents and 5 years for new incidents. The EIP limits will be $10,000,000 for each pollution incident loss with a $10,000,000 policy aggregate limit. The deductible will be $100,000 per incident. The EIP will cover the following insured sites:

1. 120 N.E. 26^th St., Oklahoma City, Oklahoma;

2. 1401, 1499, 1525, 1601, and 1615 West River Road North, Minneapolis, Minnesota;

3. 10 Commerce Way, Lancing, West Sussex, United Kingdom;

4. Porges SA-Madrazès, Rue Blaise Pascal, Lieu-Dit Madrazès, Sarlat-La-Caneda, France; and

5. Porges SA, Avenue Edmond Rostand, Lieu-Dit « Le Pontet », Sarlat La- Caneda, France.

The EIP will also provide coverage for non-owned locations in the United States with limits of $10,000,000 for each pollution incident loss with a $10,000,000 policy aggregate limit, and such non-owned locations will be scheduled by the Seller.

A separate insurance policy may be purchased for underground storage tanks located at Porges SA, avenue Edmond Rostand, Lieu-dit « le Pontet », Sarlat La- Caneda, France and 1615 West River Rd. North, Minneapolis, MN, if available at a reasonable cost and with reasonable terms (“UST Policy”). The UST Policy may provide coverage for a maximum period of three years for both pre-existing and new pollution incidents with a per incident limit of $5,000,000 and a policy aggregate limit of $5,000,000.

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Schedule 9.3

Regulatory Approvals

Notification of the transaction to the German Federal Cartel Office, and the expiration or termination of any applicable, pre-closing waiting period under German law.

Notification of the transaction and any other applicable Governmental Actions required by Spanish competition Laws.

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Schedule 11.3(a)

Seller Indemnification Matters

1. All Losses relating to the ObTape® brand products, including any components thereof, and any instruments or other accessories sold in conjunction with and for use strictly with ObTape®, other than with respect to any sales by or on behalf of Buyer of ObTape® brand products, including any components thereof, and any instruments or other accessories sold in conjunction with and for use strictly with ObTape®, following the Closing.

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Annex A

Excluded Assets

1. The following tangible assets located at Seller Subsidiary’s facilities at 1401, 1499, 1525, 1601, 1615 West River Road North, Minneapolis, MN 55411:

FAS # 6172, Asset # 7841	- Mold Mentor Texas Sizer Patch
FAS # 6284, Asset # 7951	- 4 Cavity Dome Mold
FAS # 6301, Asset # 7968	- 4 Cavity Sizer Mold Modification
89-700091-001	PKG, NON-STERIL, qty 149
90-140067-002	MED-4735 ELASTO GM , qty 40,475
90-260021-001	CONNECTOR, S.S., qty 15,525
LBL 300755-01	LABEL, PROD IDE, qty 0
89-440204-001	DOME, MOLDED, qty 273
90-700026-001	PKG, NONST, CON, qty 2,500

2. Any tangible assets exclusively related to Seller’s Mammary Bioflex Project, including:

Class	Asset #	Description
Keep on Books
F&F	Various	Chairs
M&E	5575	Hand Feed Surface Grinder
M&E	7404	2 Gallon Pot
M&E	7644	Press and Eqpt - heat sealer
M&E	7732	Jar Roller
M&E	7741	Photo Extensemeter
M&E	7733	Polymer Separator (Fiber Unwinder)
M&E	7769	Scale
M&E	7770	Scale
M&E	7785	HVAC Equipment & Installation
M&E	7808	Temperature & Humidity Data Collection & Prining Equipment

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Class Asset # Description

Comptr	6117	Thermal Printer
Ls Imp	6114	Cleanroom Enclosure
M&E	7403	Pall-Gelman Filter Housing
M&E	7624	Table Top Laser
M&E	7710	Pilot Test Cells 5,6,7
M&E	7735	Pilot Test Cell 8 Oven
M&E	7734	Polymer Separator (Fiber Unwinder)
Tooling	5954	Drip Catcher Tooling
Tooling	6095	Tray Tooling/Outer Tray
Tooling	6096	Tray Tooling/Inner Tray
Tooling	6097	Drip-Catcher

3. The following tangible assets located at Seller Subsidiary’s facilities at BP89, 24200 Sarlat la Caneda, France:

Asset ID Description Account Category Location Business Unit Project ID

3 410	CLASSE 10000 PRESSE Mentor	2.214500.	AGE	SA	2128	IV5PD034
2 964	Mentor MOULAGE	2.215100.	SPE	SA	2128	IV1PD086
3 401	POSTE DE COMPTAGE PIECES MTR	2.215400.	SCI	SA	2128	IV5PD027
3 402	ONDULATEUR MACHINE PERCAGE	2.215400.	SCI	SA	2128	IV5PD030
2 675	MOLDS SEAT BODY DV ASSEMBLY	2.215700.	AGM	SA	2128	IV1PD086
2675-2	MOLDS HORS DV ASSEMBLY	2.215700.	AGM	SA	2128	IV1PD086
2 676	02H. CHAUMEIL ET FILS19	2.215700.	AGM	SA	2128	IV1PD086
2 677	02SACOMAT73n°doc10001307	2.215700.	AGM	SA	2128	IV1PD086
2 680	Eleco produits	2.215700.	AGM	SA	2128	IV1PD086
2 683	Pagès Mécanique	2.215700.	AGM	SA	2128	IV1PD086
2 685	Cothal	2.215700.	AGM	SA	2128	IV1PD086
2 687	SARL SICOM	2.215700.	AGM	SA	2128	IV1PD086
2 688	Technical Innovation	2.215700.	AGM	SA	2128	IV1PD086
2 689	Technical Innovation	2.215700.	AGM	SA	2128	IV1PD086
2 690	Festo	2.215700.	AGM	SA	2128	IV1PD086
2 692	POLIMECA	2.215700.	AGM	SA	2128	IV1PD086
2 694	Husson	2.215700.	AGM	SA	2128	IV1PD086
2 695	Como-Ari-Total LDA TOUR	2.215700.	AGM	SA	2128	IV1PD086
2 698	Comptoir elec midi	2.215700.	AGM	SA	2128	IV1PD086

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Asset ID Description Account Category Location Business Unit Project ID

2 706	Technical Innovations	2.215700.	AGM	SA	2128	IV1PD086
2 707	VWR International	2.215700.	AGM	SA	2128	IV1PD086
2 717	BIDON SECURITE IV1PD086	2.215700.	AGM	SA	2128	IV1PD086
2 718	INTEROFFICE DOC IV1PD086	2.215700.	AGM	SA	2128	IV1PD086
2 719	PATE DIAM IV1PD086	2.215700.	AGM	SA	2128	IV1PD086
2 720	DISJONCT POMPE A VIDE	2.215700.	AGM	SA	2128	IV1PD086
2 721	SUPPORT SUIVANT PLAN	2.215700.	AGM	SA	2128	IV1PD086
2 722	REPOLISSAGE MOULE IV1PD086	2.215700.	AGM	SA	2128	IV1PD086
2 733	MANDRINS DV IV1PD086	2.215700.	AGM	SA	2128	IV1PD086
2 755	02AUTO DISTRIBUTION	2.215700.	AGM	SA	2128	IV1PD086
2 856	ETUDE ET REALISATION STRACK	2.215700.	AGM	SA	2128	IV1PD086
2 960	Mentor ASSEMBLAGE	2.215100.	SPE	SA	2129	IV1PD091
2 962	Mentor ASSEMBLAGE	2.215100.	SPE	SA	2129	IV1PD091
2 963	Mentor ASSEMBLAGE	2.215100.	SPE	SA	2129	IV1PD091
2 965	Mentor MATERIEL POUR ASSEMBLAG	2.215100.	SPE	SA	2129	IV1PD091
3 127	PLAQUES SUPPORT	2.215100.	SPE	SA	2129	IV1PD091
3 137	USINAGE 20 SUPPORTS	2.215100.	SPE	SA	2129	IV1PD091
2 891	Mentor	2.215400.	SCI	SA	2129	IV1PD091
2 901	Mentor	2.215400.	SCI	SA	2129	IV1PD091
2 921	PROJET Mentor-PIGE ACIER	2.215400.	SCI	SA	2129	IV1PD091
3 070	SYSTEME DE CONTROLE DES PIECES	2.215400.	SCI	SA	2129	IV3PD007
3 071	Mentor ASSEMBLAGE	2.215400.	SCI	SA	2129	IV1PD091
3 203	USINAGE+ DIVERS MATERIEL	2.215400.	SCI	SA	2129	IV1PD091
3 211	ASSEMBLAGE Mentor	2.215400.	SCI	SA	2129	IV1PD091
3 340	APPAREIL CONTROLE VALVES DV	2.215400.	SCI	SA	2129	IV5PD012
2 678	Travaux atelier ELLA	2.215700.	AGM	SA	2129	IV1PD091
2 679	Bureau organ°	2.215700.	AGM	SA	2129	IV1PD091
2 681	SICOM	2.215700.	AGM	SA	2129	IV1PD091
2 682	Sté française de microscopie	2.215700.	AGM	SA	2129	IV1PD091
2 684	Bruneau	2.215700.	AGM	SA	2129	IV1PD091
2 686	Mettler Toledo	2.215700.	AGM	SA	2129	IV1PD091
2 723	BIDON SECURITE IV1PD091	2.215700.	AGM	SA	2129	IV1PD091
2 724	CASIERS MELAMINES IV1PD091	2.215700.	AGM	SA	2129	IV1PD091
2 725	DESSUS DE TABLES IV1PD091	2.215700.	AGM	SA	2129	IV1PD091
2 737	BTES AIGUILLES IV1PD091	2.215700.	AGM	SA	2129	IV1PD091
2 756	DOSEUR MANO	2.215700.	AGM	SA	2129	IV1PD091
2 851	ASSEMBLAGE OUTILLAGE	2.215700.	AGM	SA	2129	IV1PD091
2 854	ASSEMBLAGE	2.215700.	AGM	SA	2129	IV1PD091
2 928	PINCES COUPANTES	2.215700.	AGM	SA	2129	IV1PD091

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Product	Inventory in Lisses		Inventory in Sarlat		WIP in Sarlat		Total in hand		Orders pending		Excess inventory
ME1263 Plug cap; 200563-001		5,163						5,163		4,000		1163.00
ME2553 Std Dome; 200553-001												0.00
ME2554 Micro dome; 200554-001		3,955						3,955		4,000		(45.00	)
ME2555 Plug strap; 200555-001		3,435				21,000		24,435		25,000		(565.00	)
ME2556 Diapragm valve; 200556-001				6,108		65,000		71,108		80,000		(8892.00	)
												0.00
												0.00
ME256670 Dv Body molded unassembled				28,128				28,128
ME256770 DV Seat Molded Unassembled				3,727				3,727
												0.00

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Annex B

Infrastructure Assets

1.	Software (Enterprise, User licenses, and maintenance agreements):
	JD Edwards Enterprise One ERP Version 8.0
	Vertex Tax Software System: Quantum S/U System, Taxability Mapping Tool for QSUT, Quantum S/U
	Electronic Data Interface Software: Softshare Delta and ECS Software
	dcLink Automated Data Capture Software
	Optio e.ComIntegrate Output Management Software
	TRAXi3 Shipping and Freight Management Software
	Loftware Print Server Enterprise Edition
	Check Point NG Firewall Software
	Mail Store, domain controllers, and all associated e-mail software
	McAfee Anti-Virus Software
	GFI Mail Essentials Spam Filtering Software
	Webroot SpySweeper Software
	WSUS Windows Upgrade Software
	Informatica PowerMart
	Oracle Database and Support Agreements
	Cognos Impromptu and Powerplay
	ClinAccess
	SAS Base

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	All Help Desk software and support tools Software, Asset Problem Management Software; and Orion, Navigator - Asset, Incident & including Alloy Solar Winds - Network Management Software.
2.	Hardware and other Infrastructure Assets in Seller’s facilities at Santa Barbara, including, without limitation:

Location	Manufacturer		Model		Description		Quantity
Santa Barbara Data Center		Compaq		Deskpro EP		Workstation		1
Santa Barbara Data Center		Compaq		Deskpro EP		Workstation		1
Santa Barbara Data Center		Compaq		Evo D510		Workstation		1
Santa Barbara Data Center		Compaq		Evo D510 CMT		Workstation		1
Santa Barbara Data Center		Compaq		Proliant 3000		Server		1
Santa Barbara Data Center		Compaq		Proliant 3000		Server		1
Santa Barbara Data Center		Compaq		Proliant 3000		Server		1
Santa Barbara Data Center		Compaq		Proliant 3000		Server		1
Santa Barbara Data Center		Compaq		ProLiant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		Proliant DL360		Server		1
Santa Barbara Data Center		Compaq		PROLIANT DL360 G1		Server		1
Santa Barbara Data Center		Compaq		ProLiant DL380		Server		1
Santa Barbara Data Center		Compaq		Proliant DL380		Server		1
Santa Barbara Data Center		Compaq		Proliant DL380		Server		1
Santa Barbara Data Center		Compaq		Proliant DL380		Server		1

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Location	Manufacturer	Model	Description	Quantity
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	Proliant DL380	Server	1
Santa Barbara Data Center	Compaq	ProLiant DL380	Server	1
Santa Barbara Data Center	Compaq	ProLiant DL380 G4	Server	1
Santa Barbara Data Center	Compaq	Proliant DL580	Server	1
Santa Barbara Data Center	Compaq	Proliant DL580	Server	1
Santa Barbara Data Center	Compaq	Proliant DL580	Server	1
Santa Barbara Data Center	Compaq	Proliant DL580	Server	1
Santa Barbara Data Center	Compaq	Proliant DL580	Server	1
Santa Barbara Data Center	Compaq	Proliant DL580	Server	1
Santa Barbara Data Center	Compaq	Proliant DL580	Server	1
Santa Barbara Data Center	Compaq	Proliant DL580 G1	Server	1
Santa Barbara Data Center	Compaq	Proliant PL1600	Server	1
Santa Barbara Data Center	Dell	Dell Optiplex GX110	Workstation	1
Santa Barbara Data Center	Dell	Dell Optiplex GX110	Workstation	1
Santa Barbara Data Center	Dell	Dell Optiplex GX110	Workstation	1
Santa Barbara Data Center	Extreme Networks	Alpine 3808	Core Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1

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Location	Manufacturer	Model	Description	Quantity
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	Extreme Networks	Summit 48si	Edge Switch	1
Santa Barbara Data Center	HP	EVA 5000	SAN	1
Santa Barbara Data Center	Liebert	System 3	Cooling System	1
Santa Barbara Data Center	Liebert	System 3	Cooling System	1
Santa Barbara Data Center	Nokia	IP380	Firewall	1
Santa Barbara Data Center	Nokia	IP380	Firewall	1
Santa Barbara Data Center	Qualstar	RLS-6227 SDLT	Tape Library	1
Santa Barbara Data Center	Toshiba	4200FA	UPS	1
SB-Internal	Compaq	Compaq Evo D510 CMT	Desktop	1
SB-Internal	Compaq	Compaq Evo D510 CMT	Desktop	1
SB-Internal	Compaq	Compaq Evo D510 CMT	Desktop	1
SB-Internal	Compaq	Compaq Evo D510 CMT	Desktop	1
SB-Internal	Compaq	Compaq Evo D510 CMT	Desktop	1
SB-Internal	Compaq	Compaq Evo D510 CMT	Desktop	1
SB-Internal	Compaq	Compaq Evo N410	Laptop	1
SB-Internal	Dell	Dell Latitude CPx H500GT	Laptop	1
SB-Internal	HP	Hewlett-Packard Compaq nx7010 (PL529UA#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP Compaq dc5100 MT(PZ582UA)	Desktop	1
SB-Internal	HP	Hewlett-Packard HP Compaq nc4010 (PA741AA#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP Compaq nc4010 (PF672AA#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP Compaq nc4200 (PV983AW#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1

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Location	Manufacturer	Model	Description	Quantity
SB-Internal	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP Compaq nc8230 (PZ094UA#ABA)	Laptop	1
SB-Internal	HP	Hewlett-Packard HP d530 CMT (DG768A)	Desktop	1
SB-Internal	HP	Hewlett-Packard HP dc5000 uT (PB137UA)	Desktop	1
SB-Internal	HP	Hewlett-Packard HP dc5000 uT (PB137UA)	Desktop	1

3.	The tangible assets located at the following entities:
	Mentor Medical Italia Srl
	Mentor Benelux B.V.
	Mentor Medical Systems Canada
	Mentor Medical Systems, B.V.
	Mentor Medical Systems, C.V.
	Mentor Deutschland GmbH
	Mentor Medical Systems Iberia S.L.
	Mentor Medical Systems France, SA

Seller Listing Schedules 

Page 168 of 179

Annex C

Transferred Tangible Assets

1.   The following tangible assets located at Seller Subsidiary’s facilities at 3041 Skyway Circle North, Irving, TX 75038:

Asset 2585 - Ross Double Planetary Mixer purchased on 2/2003 - qty 1

Asset 2589 - Filler Assy/Pump Planetary Mixer purchased on 2/2003 - qty 1

Curing Trays

Small, P/N 314013 - qty 4, purchased on 9/2002

Medium, P/N 314014 - qty 3, purchased on 9/2002

Large, P/N 314015 - qty 2, purchased on 9/2002

Drip pan for curing trays, P/N 314016 - qty 6, purchased on 9/2002

Mandrels

Extra Small size, P/N 103009-1-005 - qty 106

Small size, P/N 103009-002 - qty 83

Medium size, P/N 103009-003 - qty 151

Large size, P/N 103009-004 - qty 79

Extra Large size, P/N 103009-1-006 - qty 110

Mandrel Rods, P/N 313362-002 - qty 250

Testicular Dipping Blocks, P/N 313362-001 - qty 11

Asset 2925 - Inner thermoform purchased on 3/2004, P/N 104468 - qty 3055

Asset 2924 - Outer thermoform purchased on 3/2004, P/N 104469 - qty 3274

Vulcanizing Platens, P/N 313747-001, qty 11; P/N 313747-002, qty 11

Vulcanizing pads, P/N 314031-001, qty 14; P/N 314031-002, qty 10

Testicular holding trays for dip coating - qty 11 (4 small, 3 medium, 4 large), Built by Mentor TX Machine Shop on 12/2002

Asset 2283 - Allen-Bradley Vulcanizer, qty 1+

Seller Listing Schedules 

Page 169 of 179

2.	The following tangible assets located at Seller Subsidiary’s facilities at Zernikedreef 2, 2333 CL Leiden, the Netherlands:
	LN01	FG01	450-1122	Gel Testicular S
	LN01	FG01	450-1124	Gel Testicular M
	LN01	FG01	450-1126	Gel Testicular L
	LN01	RM01	10178	Base Testicular
	LN01	RM01	10179	Cure Agent
	LN01	RM01	10181	Gel formulation testicular
	LN01	RM01	11274	Label patient lables
	LN01	RM01	11275	Label inner testicular
	LN01	RM01	11276	Label Testicular Box
	LN01	RM01	10421	Lid Inner Testicular
	LN01	RM01	10422	Lid Outer Testicular
	LN01	RM01	10323	Box Testicular
	LN01	RM01	10325	PID Testicular Gel, MLL
	LN01	RM01	10188	Shell Test S
	LN01	RM01	10189	Shell Test M
	LN01	RM01	10190	Shell Test L
	LN01	RM01	10600	Thermoform Inner Test. PC
	LN01	RM01	10601	Thermoform Outer Test. PC
	LN02	FG01	450-1122	Gel Testicular S
	LN02	FG01	450-1124	Gel Testicular M
	LN02	FG01	450-1126	Gel Testicular L

Seller Listing Schedules 

Page 170 of 179

5653196	WO	450-1122	S90
5664878	WO	450-1122	S90
5660825	WO	450-1124	S90
5664877	WO	450-1124	S90
5664879	WO	450-1124	S90
5664880	WO	450-1124	S90
5664881	WO	450-1124	S90
5651067	WO	450-1126	S90
5651068	WO	450-1126	S90
5653200	WO	450-1126	S90
5664876	WO	450-1126	S90
Sealers for testicular (selfmade), qty 1
Matrijzen tbv dozen testiculars (Supplier: InterGrafiPak), qty 1
Gereedschap tb. Tyvek (testiculars) (Supplier: Nelipak), qty 1
Losse pomp (Supplier: Stork), qty 1
Ombouw testicular system (Supplier: Stork), qty 1
Carbolite oven, qty 1
Bovenweger (Supplier: Sartorius), qty 1

3. The following tangible assets:

US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1

Seller Listing Schedules 

Page 171 of 179

US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C510	Laptop	1
US Remote Sales	Dell	Dell Latitude C600	Laptop	1
US Remote Sales	Dell	Dell Latitude C600	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1

Seller Listing Schedules 

Page 172 of 179

US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	Dell	Dell Latitude C640	Laptop	1
US Remote Sales	HP	Hewlett-Packard Compaq nx5000 (DW806AA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard Compaq nx7010 (DV139U#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard Compaq nx7010 (DV139U#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard Compaq nx7010 (PL529UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard Compaq nx7010 (PL529UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard Compaq nx7010 (PL529UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard Compaq nx7010 (PL529UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc4200 (PV983AW#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1

Seller Listing Schedules 

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US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PR175UA#ABA)	Laptop	1
US Remote Sales	HP	Hewlett-Packard HP Compaq nc8230 (PZ094UA#ABA)	Laptop	1

Healthcare Urology Marketing Literature
1/31/2006
Quantity	Description
	AD CARDS, 8.5" X " product slick
1200	BTA Stat
1625	Clear Advantage
0	Dormia Stone Baskets
1000	E-Z Hold
0	EasiVac
650	Elefant Irrigation Device
1925	Dfolysil Caths
275	Freedom Clear
950	Freedom Clear LS & SS
2500	Post Cath
5575	Self-Cath Closed System
4375	Self-Cath Plus
3850	Skin Care
500	Telecath Urostomy Sampling Cath
2450	Ultra-Fresh
	FORMS/SUPPLIES
1250	Mentor System Brochure(Freedom Products)
1000	Folder, old Corporate
2500	Folder, new Corporate
30	Pessary Order Form
1125	Sales Binder Tabs: Urology Healthcare
163	Sales Binder: Urology Healthcare/Surgical
525	Sales Binder: Double Vinyl Pouch
1000	Clear Poly Handled Bag
	PATIENT EDUCATION MATERIALS
325	Brochure: Discharge Planner Pack
1775	Brochure: Eva Care Pessaries Use & Care
1950	Brochure: Kids Can Cath
6350	Card: Patient Reference Card
3450	Toobie Coloring Book, English
4075	Toobie Coloring Book, Spanish
1200	Clean Internittent Cath
3875	Indwelling Caths
1100	Parent Guide to Clean Intermittent Cath, English
3825	Self-Cath Closed System
1500	Self-Cath Hydrogel
8000	Self-Cath Hydrogel, Rev A
950	Self-Cath for Adolescents
2150	Urinary & Bowel continence Procedure

Seller Listing Schedules 

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3500	Urinary Continence Systems for Men, English
2500	Urinary Continence Systems for Men, Spanish
2275	Clean Intermittent Cath, Spanish
1350	Parents CIC Guide, Spanish
400	Pessary Video, Spanish
	SURGEON LITERATURE
126	Booklet: Anatomical Prolapse & Pessary Placement Illustrations
175	Brochure: Eva Care Pessaries
5400	Brochure: Healthcare All Products
3375	Brochure: Self-Cath Hydrogel
15000	Brochure: Self-Cath Hydrogel, Rev A
100	Clinician Instructions: Pessary Fitting Tips
600	Clinician Instructions: Pessary Fitting Tips, Spanish
268	Poster: Eva Care Fitting Info
	DEALER LITERATURE
500	Brochure Insert: Freedom Brand Male External Catheters
522	Brochure Insert: Freedom Brand Male External Catheters, laminated
1825	Brochure: Mentor Continence Center - MEC's
	PRESCRIPTION PADS
484	Male External Catheters
933	Self-Cath
	PRICE LISTS
662	Department of Veteran Affairs
2550	Clinical, July 15, 2005
2050	Dealer, July 15, 2005
436	Provider/Distributor, July 15, 2005
145	Wholesaler, July 15, 2005
	CLINICIAN LITERATURE
2625	Brochure: Alpine Reusable Leg Bag
200	Brochure: Incontinence Education
5000	Brochure: Pessary Education Program
450	Instructional Aid: Clear Advantage
4200	Measurement Guide: MEC

Surgical Urology Marketing Literature
1/31/2006
Quantity	Description
	AD CARDS, 8.5" X " product slick
825	Adjustable Vaginal Stent
400	Brooks Corporal Dilator Set
2150	Mick 20 Cartridge
2025	Prescription Loaded Needles
975	Prostrate Brachytherapy Needles
1225	Saline-Filled Testicular, International
400	Suspend
1150	Suspend, International

Seller Listing Schedules 

Page 175 of 179

1050	Titan IPP w/Resist, International
2500	Titan IPP w/Resist, International, Rev B
1400	Titan Narrow Base
7900	Prostaseed
7350	Testiculars
1325	Brochure: Excel w/Resist (2 piece implant)
	FORMS & SUPPLIES
800	Direct Delivery Reciepts
8000	Urologic Specialties Request for Information
880	Sales Binder Tabs, Surgical Urology
162	Sales Binder, Surgical Urology
0	Sales Binder: Double Vinyl Pouch
	PATIENT EDUCATION
575	Display Stand: Brachy Patient Guides
1500	Impotence Peer-level Program Flyer (Straight Talk)
38000	Back in Control Guide
6500	Back in Control Guide, Spanish
2075	Excel with Resist Guide
1375	Patient Suspend & Axis Guide
2075	Patient Suspend & Axis Guide, Spanish
7050	Prostate Brachytherapy Guide
2575	Prostate Brachytherapy Guide, Spanish
5700	Saline Testiculars
11250	Straight Talk About ED
4125	Straight Talk About ED, Spanish
1125	Wallet Card: Titan IPP Courtesy
175	Wallet Card: Titan IPP Courtesy, Spanish
	SURGEON LITERATURE
1400	Brochure: Alpha I with Lock-Out Valve
6400	Brochure: Aris
2825	Brochure: AXIS Tutoplast Processed Dermis
3000	Brochure: Customer Support Programs
2575	Brochure: Dosimetry Planning
2900	Brochure: Genesis
2225	Brochure: Genesis with Resist, International
4375	Brochure: Isoloader
2900	Brochure: Proctorship Program
1800	Brochure: Strands
475	Brochure: Suspend and the History of Prions
900	Brochure: Suspend Pelvic Floor Reconstruction
950	Brochure: Suspend (reprint update)
4025	Brochure: Titan IPP
300	Card: Saline Testicular Filling Instructions
4800	Catalog: Urologic Specialties (Sept 2005)
195	FAX: Surgery Fax Sheet (ED)
4975	Flyer: Aris Tissue Ingrowth
9575	Flyer: Short Term Results of Aris Trans-Obturator Tape Implantation
1120	Folder: Customer Support Program

Seller Listing Schedules 

Page 176 of 179

1884	Folder: Womens Health
1050	Info Sheet: titan IPP with Resist Solution Absorption
0	Program Brochure: Early Detection
9	Pat Ed Program Kit Binder
0	Pat Ed Program Pateint Guide
12	Patient Marketing Program Kit Binder
200	Penile Implants Lifetime Replacement Policy
19	Physician Networking Program Kit Binder
4250	Physician Networking Program Physician Brochure
1825	Surgeon Instructions: Suspend/Axis Rehydration Card, laminated
10450	Surgical Guidelines: Pelvic Floor
1550	Surgical Protocol: Alpha I Penile Prosthesis
1775	Surgical Protocol: Excel with Resist, International
2000	Surgical Protocol: Genesis
300	Surgical Protocol: Genesis with Resist, International
	VIDEOS
0	DVD: Patient Ed, Back in Control, TOT Procedure
7700	VIDEO: Patient Ed, Back in Control
2600	VIDEO: Patient, Straight Talk About ED
1679	DVD: Patient Ed, Straight Talk About ED
100	DVD: Patient Ed, Straight Talk About ED, Spanish
910	VIDEO: Patient, Straight Talk About ED, Spanish
81	VIDEO: Alpha I Inflatable Penile,Scrotal Approach, PAL
472	Alpha I Infrapubic Technique
7	VIDEO: Malleable Penile, PAL
90	VIDEO: Suspend
19	VIDEO: Suspend, PAL
42	VIDEO: Cadaveric Prolapse Sling
79	CD: Cadaveric Prolapse Sling
43	VIDEO: CaVVERS, Leach
87	CD: CaVVERS, Leach
85	VIDEO: Male Perineal Sling
92	CD: Male Perineal Sling
83	VIDEO: Penile Reconstruction Using Human Cadaveric Pericardium
43	VIDEO: Suspend Cystocele Repair, PAL
16	VIDEO: Suspend Rectocele Repair
72	CD: Suspend Rectocele Repair
30	VIDEO: Suspend Rectocele Repair, PAL
4082	VIDEO: TOT Trans-oburator Technique Surgical Procedure
38	DVD: TOT Trans-oburator Technique Surgical Procedure,
6375	DVD: La Bombita with Andres, Spanish
	PRICE LIST
3350	Urology Surgical

Seller Listing Schedules 

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Miscellaneous Items
2/1//2006
Quantity	Urology Journal Reprints	Author
225	Management of Infected Penile Implants	Mulcahy
2950	Long Term Results with Hydroflex and Dynaflex Penile Prosthesis Device	Wilson
250	Outcome Analysis of Goal Directed Therapy for Impotence	Jarow
125	Safety and Efficacy Outcome of Mentor Alpha I Inflatable…	Goldstein
375	The Management of Localized Prostate Cancer: A Patient's Guide	Prostate cancer Clinical Guidelines Panel
598	Ultrasound-Guided transperineal Implantation of Iodine 125 and…	Do, Blasko & Ragde
821	Should Brachytherapy be considered a Therapeutic Option in Localized Prostate…	Blasko
821	Comparison of Mechanical Reliability of Original and Enhanced Mentor Alpha I…	Wilson, Cleves & Delk
3078	Application of pericardial Graft in the…	Hellstrom & Reddy
8700	Allograft Sling Material: Is It The State of the Art	Ghoniem
1600	Long Term Experience with Salvage of Infected penile Implants	Mulcahy
4551	Evaluation of Cadaceric Pericardium in the Rat for the Surgical Treatment of…	Leungwattanakihj, Bivalacqua & Justin
8800	Is Facia Lata Allograft Material Trustworthy for Pubovaginal Sling Repair	Elliott & Boone
4310	Pelvic Prolapse	Kobashi & Leach
6600	A New Technique for Cystocele Repair and Transvaginal Sling…	Kobashi, Mee & Leach
3650	Better Prospects for Stress Urinary Incontinence	Kobashi & Leach
798	Long term Mechanical Reliability of Multicomponent Inflatable…	Dubocq, Tefilli, Gheiler Li & CB
330	Diagnosis and Management of Male Sexual Dysfunction	Wilson
3100	The Use of Cadaveric Solvent…	Chaiken
7325	Male Perineal Sling	Ghoniem & Bryan
345	Efficacy, Safety and Patient Satisfaction outcomes of the AMS 700CX Inflatable…	Carson, Mulcahy, Govier & MMS 700CX Study
2550	Continuing Multicenter Follow Up of Cadaveric Prolapse Repair With…	Kobashi
2170	The Standardization of Terminology of Female Pelvic Organ Prolapse and…	Bump RC, Mattiasson A, BO K, et al
800	Empirical Dosimetric Characterization of Model I125-SL 125 Iodine	Wallace
775	Monte Carlo calculations of Dosimetry Parameters of the Urocor Prostaseed 125I	Li
375	Serial Assessment of Efficacy and Satisfaction Profiles Following Penile…	Mulhall
1900	Antimicrobial Activity of Antibiotic-Soaked Resist-Coated Bioflex	Hellstrom et al

Seller Listing Schedules 

Page 178 of 179

490	A Prospective Randomized Trial Comparing Tension-Free vaginal Tape	Tayac et al
400	The Why & How of Synthetic Replacement Testicles	Ortenberg & Kupper
375	Testicular Prosthesis	Beer & Kay
50	The Hydrophilic-Coated Inflatable Penile Prosthesis, 1 year	Wolster & Hellstrom
485	A Survey of Patients with Inflatable Penile Prostheses for…	Gerard, Henry, Wilson & Delk
225	Early Experience with the First Pre-Connected 3-Piece Inflatable Penile…	Goldstein et al
2925	Mentor Alpha I Inflatable Penile Prosthesis: Patient Satisfaction and Device…	Garber
450	Clinical Experience with Mentor Alpha I Inflatable Penile Prosthesis	Randrup, et al
125	A Guide to Safe Corporotomy Incisions in the Presence of Underlying…	Hakim
500	Long-Term Results of Penile Prosthetic implants	Lewis
700	Penile Curvatures and Aneurysmal Defects with the Ultrex Penile…	Kowalczyk
	Misc. Program & Promotional Materials
500	Aris Pen
26	Dry Erase Boards
150	Laser Pointers
180	Padfolio
200	Straight Talk Easel
3600	Couple's Disease Hard Cover Book
1800	ARIS Mousepads
63	ARIS Spiral Bound Purchasing Committee Book
320	Back in Control Easels
50	Back in Control Incontinence Binder
45	Back in Control Reference Binder
2100	brachytherapy Keychain
36	Acrylic Stand, Large
1800	Acrylic Stand, Small
1040	Testicular templates
12600	Mentor Custom Shipping Box
1176	HydroGel Plastic Water Bottle, Sports
2730	HydroGel Can Koozie
1440	HydroGel Metal Travel Mug
6000	HydroGel Pen
3000	Mentor Healthcare Blue Pen
1200	Self-Cath Note Cube
1500	Luggage Tag
780	Calculator
1400	BTA Stat Timer
3240	BTA Stat Post It Note
22	Spinal Network Book
180	Kid On Wheels Book

Seller Listing Schedules 

Page 179 of 179

3120	Kids Can Cath Program Back Pack
240	Discharge Planner Back Pack

EX-2

EXHIBIT 2.5

MENTOR CORPORATION
201 Mentor Drive
Santa Barbara, California 94311
USA

June 2, 2006

COLOPLAST A/S
Holtedam 1
3050 Humlebæk
Copenhagen, DENMARK

Ladies and Gentlemen:

Reference is made to that certain Purchase Agreement (the "Purchase Agreement") dated as of May 17, 2006, by and between Coloplast A/S, a Danish corporation ("Buyer") and Mentor Corporation, a Minnesota corporation ("Seller").  Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Purchase Agreement.

In connection with the consummation of the transactions contemplated by the Purchase Agreement, Seller and Buyer wish to document their mutual agreement and understanding with respect to the matters set forth in this letter. 

1.The Parties acknowledge and agree that the following items shall be excluded from the calculation of the Net Working Capital Target, the Net Working Capital as reflected on the Closing Date Net Working Capital Statement and the Net Working Capital as reflected on the Final Net Working Capital Statement:

            (a)any Liability for Taxes (including, without limitation, withholding and Transfer Taxes) and all costs (including third-party costs) incurred by Porges in connection with the Porges Asset Sale; and

            (b)any Liability with respect to Transferred Employees incurred by Porges in connection with the Porges Asset Sale arising under any profit sharing, profit participation, dividend or like plans or programs and any third party costs and expenses associated therewith ("Porges Transfer Liabilities").

2.Notwithstanding anything in the Purchase Agreement to the contrary and without limiting the obligations set forth in the Purchase Agreement, Buyer shall indemnify Seller and hold Seller harmless from and against the Porges Transfer Liabilities.

3.Attached hereto as Exhibit A is the Preliminary Purchase Price Allocation agreed to by Buyer and Seller as contemplated by Section 8.8 of the Purchase Agreement.

4.Schedule 1.173 to the Purchase Agreement is hereby amended to add the following license, which shall constitute a Transferred Contract under the Purchase Agreement:

            License Agreement dated as of June 1, 2006, by and between Bruce S. Crawford, MD, FACOG, and Mentor Corporation, a Minnesota corporation.

5.Schedule 1.178 to the Purchase Agreement is hereby amended to add the following domain names, which shall constitute Transferred Internet Properties under the Purchase Agreement:

            edtalk.org
            mypenilehealth.com
            getbackincontrol.com
            getbackincontrol.net
            getbackincontrol.org

6.Schedule 7.1(a) to the Purchase Agreement is hereby amended to delete the following named individuals: 

Henry Arnion

Philippe Berthat

Géraldine Foulon

Natali Fournier

Francis Frignani

Véronique Manscourt

Valérie Mautino

Valerie Tellier

7.The Parties agree that following the Closing they will work together in good faith to coordinate the transition of the statutory auditors for Porges and MML, with such transition to occur in a manner to allow for the following:  (a) timely completion of all required statutory audits (including pending audits); (b) preparation of financial statements for all periods through and including the Closing; and (c) as soon as reasonably practicable following the Closing (but in no event compromising completion of (a) and (b)), provide for PricewaterhouseCoopers (or its affiliate) to serve as a statutory auditor of such entities (either in capacity as the primary or second auditor of such entities, as is practicable). 

8.Buyer hereby agrees that it will provide reasonable assistance, without charge, to Seller in the preparation by Seller and its Subsidiaries of financial statements necessary for Buyer's SEC reporting requirements for all periods through and including the Closing the timely completion of any statutory audits for any period ending on or prior to Closing following the Closing, and the delivery of audited financial statements with respect to the Business required to be delivered to Buyer under the Purchase Agreement, which assistance in each case will include access to appropriate personnel, books and records of Buyer and its Subsidiaries and cooperation in the preparation of such financial statements and statutory audits.

9.Buyer and Seller agree to negotiate in good faith the terms and conditions of the Schedules to the Transition Services Agreement that are not completed as of the Closing as promptly as practicable following the Closing.

Except as expressly provided above, nothing in this letter agreement shall serve to modify the terms set forth in the Purchase Agreement. 

This letter agreement will be governed by the laws of the State of Minnesota, United States of America, without regard to any conflicts of law principles.  The provisions of Article 13 of the Purchase Agreement shall be applicable to any dispute, controversy or difference arising out of this letter agreement.

Please indicate Coloplast's concurrence with and acceptance of this letter agreement by executing two copies of it in the space provided below and returning one such copy to me at your earliest convenience.

Very truly yours,

MENTOR CORPORATION

By: /s/ Loren L. McFarland                        

Name: Loren L. McFarland                         

Title: VP, CFO                                               

AGREED TO AND ACCEPTED:

COLOPLAST A/S

By: /s/ Peter Volkers                                    

Name: Peter Volkers                                    

Title: Vice President, Legal Affairs           

EX-10

EXHIBIT 10.4

MENTOR CORPORATION

2005 LONG-TERM INCENTIVE PLAN

(AS AMENDED NOVEMBER 2005)

1.         PURPOSE OF PLAN

            The purpose of this Mentor Corporation 2005 Long-Term Incentive Plan (this "Plan") of Mentor Corporation, a
            Minnesota corporation (the "Corporation"), is to promote the success of the Corporation and to increase
            shareholder value by providing an additional means through the grant of awards to attract, motivate, retain and
            reward selected employees and other eligible persons.  This Plan amends and restates the Corporation's
            Amended 2000 Long-Term Incentive Plan.  The Share Limit set forth in Section 4.2 applies to awards granted
            under this Plan before and after this amendment and restatement of this Plan.  For purposes of clarity, no
            additional shares are added to the Share Limit as a result of this amendment and restatement.

2.         ELIGIBILITY

            The Administrator (as such term is defined in Section 3.1) may grant awards under this Plan only to those persons
            that the Administrator determines to be Eligible Persons.  An "Eligible Person" is any person who is either: (a) an
            officer (whether or not a director) or employee of the Corporation or one of its Subsidiaries; (b) a director of the
            Corporation or one of its Subsidiaries; or (c) an individual consultant or advisor who renders or has rendered bona
            fide services (other than services in connection with the offering or sale of securities of the Corporation or one of
            its Subsidiaries in a capital-raising transaction or as a market maker or promoter of securities of the Corporation
            or one of its Subsidiaries) to the Corporation or one of its Subsidiaries and who is selected to participate in this
            Plan by the Administrator; provided, however, that a person who is otherwise an Eligible Person under clause
            (c) above may participate in this Plan only if such participation would not adversely affect either the Corporation's
            eligibility to use Form S-8 to register under the Securities Act of 1933, as amended (the "Securities Act"), the
            offering and sale of shares issuable under this Plan by the Corporation or the Corporation's compliance with any
            other applicable laws.  An Eligible Person who has been granted an award (a "participant") may, if otherwise
            eligible, be granted additional awards if the Administrator shall so determine.  As used herein, "Subsidiary"
            means any corporation or other entity a majority of whose outstanding voting stock or voting power is beneficially
            owned directly or indirectly by the Corporation; and "Board" means the Board of Directors of the Corporation.

3.         PLAN ADMINISTRATION

3.1    The Administrator.  This Plan shall be administered by and all awards under this Plan shall be authorized
                    by the Administrator.  The "Administrator" means the Board or one or more committees appointed
                    by the Board or another committee (within its delegated authority) to administer all or certain aspects of this
                    Plan.  Any such committee shall be comprised solely of one or more directors or such number of directors as
                    may be required under applicable law.  A committee may delegate some or all of its authority to another
                    committee so constituted.  The Board or a committee comprised solely of directors may also delegate, to the
                    extent permitted by applicable law, to one or more officers of the Corporation, its powers under this Plan (a)
                    to designate the officers and employees of the Corporation and its Subsidiaries who will receive grants of
                    awards under this Plan, and (b) to determine the number of shares subject to, and the other terms and
                    conditions of, such awards.  The Board may delegate different levels of authority to different committees
                    with administrative and grant authority under this Plan.  Unless otherwise provided in the Bylaws of the
                    Corporation or the applicable charter of any Administrator: (a) a majority of the members of the acting
                    Administrator shall constitute a quorum, and (b) the vote of a majority of the members present assuming
                    the presence of a quorum or the unanimous written consent of the members of the Administrator shall
                    constitute action by the acting Administrator.

                    With respect to awards intended to satisfy the requirements for performance-based compensation under
                    Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code"), this Plan shall be
                    administered by a committee consisting solely of two or more outside directors (as this requirement is
                    applied under Section 162(m) of the Code); provided, however, that the failure to satisfy such
            

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                    requirement shall not affect the validity of the action of any committee otherwise duly authorized and
                    acting in the matter.  Award grants, and transactions in or involving awards, intended to be exempt
                    under Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
                    must be duly and timely authorized by the Board or a committee consisting solely of two or more
                    non-employee directors (as this requirement is applied under Rule 16b-3 promulgated under the
                    Exchange Act).  To the extent required by any applicable listing agency, this Plan shall be
                    administered by a committee composed entirely of independent directors (within the meaning of the
                    applicable listing agency).

            3.2    Powers of the Administrator.  Subject to the express provisions of this Plan, the Administrator is
                    authorized and empowered to do all things necessary or desirable in connection with the
                    authorization of awards and the administration of this Plan (in the case of a committee or delegation
                    to one or more officers, within the authority delegated to that committee or person(s)), including,
                    without limitation, the authority to:

                    (a)    determine eligibility and, from among those persons determined to be eligible, the particular
                            Eligible Persons who will receive an award under this Plan;

                    (b)    grant awards to Eligible Persons, determine the price at which securities will be offered or
                            awarded and the number of securities to be offered or awarded to any of such persons,
                            determine the other specific terms and conditions of such awards consistent with the express
                            limits of this Plan, establish the installments (if any) in which such awards shall become
                            exercisable or shall vest (which may include, without limitation, performance and/or time-based
                            schedules), or determine that no delayed exercisability or vesting is required, establish any
                            applicable performance targets, and establish the events of termination or reversion of such
                            awards;

                    (c)    approve the forms of award agreements (which need not be identical either as to type of award or
                            among participants);

                    (d)    construe and interpret this Plan and any agreements defining the rights and obligations of the
                            Corporation, its Subsidiaries, and participants under this Plan, further define the terms used in
                            this Plan, and prescribe, amend and rescind rules and regulations relating to the administration
                            of this Plan or the awards granted under this Plan;

                    (e)    cancel, modify, or waive the Corporation's rights with respect to, or modify, discontinue,
                            suspend, or terminate any or all outstanding awards, subject to any required consent under
                            Section 8.6.5;

                    (f)     accelerate or extend the vesting or exercisability or extend the term of any or all such outstanding
                            awards (in the case of options, within the maximum ten-year term of such awards) in such
                            circumstances as the Administrator may deem appropriate (including, without limitation, in
                            connection with a termination of employment or services or other events of a personal nature)
                            subject to any required consent under Section 8.6.5;

                    (g)    adjust the number of shares of Common Stock subject to any award, adjust the price of any or all
                            outstanding awards or otherwise change previously imposed terms and conditions, in such
                            circumstances as the Administrator may deem appropriate, in each case subject to Sections 4
                            and 8.6, and provided that in no case (except due to an adjustment contemplated by Section 7
                            or any repricing that may be approved by shareholders) shall such an adjustment constitute
                            a repricing (by amendment, cancellation and regrant, exchange or other means) of the per
                            share exercise price of any option;

                    (h)    determine the date of grant of an award, which may be a designated date after but not before the
                            date of the Administrator's action (unless otherwise designated by the Administrator, the date of
                            grant of an award shall be the date upon which the Administrator took the action granting an award);

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                    (i)     determine whether, and the extent to which, adjustments are required pursuant to Section 7 hereof
                            and authorize the termination, conversion, substitution or succession of awards upon the
                            occurrence of an event of the type described in Section 7;

                    (j)     acquire or settle (subject to Sections 7 and 8.6) rights under awards in cash, stock of equivalent
                            value, or other consideration; and 

                    (k)    determine the fair market value of the Common Stock or awards under this Plan from time to time
                            and/or the manner in which such value will be determined.

            3.3    Binding Determinations.  Any action taken by, or inaction of, the Corporation, any Subsidiary, or the
                    Administrator relating or pursuant to this Plan and within its authority hereunder or under applicable law
                    shall be within the absolute discretion of that entity or body and shall be conclusive and binding upon
                    all persons.  Neither the Board nor any Board committee, nor any member thereof or person acting at
                    the direction thereof, shall be liable for any act, omission, interpretation, construction or determination
                    made in good faith in connection with this Plan (or any award made under this Plan), and all such persons
                    shall be entitled to indemnification and reimbursement by the Corporation in respect of any claim, loss,
                    damage or expense (including, without limitation, attorneys' fees) arising or resulting therefrom to the
                    fullest extent permitted by law and/or under any directors and officers liability insurance coverage that
                    may be in effect from time to time. 

            3.4    Reliance on Experts.  In making any determination or in taking or not taking any action under this Plan, the
                    Board or a committee, as the case may be, may obtain and may rely upon the advice of experts, including
                    employees and professional advisors to the Corporation.  No director, officer or agent of the Corporation or
                    any of its Subsidiaries shall be liable for any such action or determination taken or made or omitted in
                    good faith.

            3.5    Delegation.  The Administrator may delegate ministerial, non-discretionary functions to individuals who are
                    officers or employees of the Corporation or any of its Subsidiaries or to third parties.

4.        SHARES OF COMMON STOCK SUBJECT TO THE PLAN; SHARE LIMITS

            4.1    Shares Available.  Subject to the provisions of Section 7.1, the capital stock that may be delivered under
                    this Plan shall be shares of the Corporation's authorized but unissued Common Stock and any shares of its
                    Common Stock held as treasury shares.  For purposes of this Plan, "Common Stock" shall mean the
                    common stock of the Corporation and such other securities or property as may become the subject of
                    awards under this Plan, or may become subject to such awards, pursuant to an adjustment made under
                    Section 7.1.

            4.2    Share Limits.  The maximum number of shares of Common Stock that may be delivered pursuant to awards
                    granted to Eligible Persons under this Plan is 6,000,000 shares (the "Share Limit").  The following limits
                    also apply with respect to awards granted under this Plan:

                    (a)    The maximum number of shares of Common Stock that may be delivered pursuant to options qualified
                            as incentive stock options granted under this Plan is 6,000,000 shares.

                    (b)    The maximum number of shares of Common Stock subject to options that are granted during any
                            fiscal year to any individual under this Plan is 500,000 shares.

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                    (c)    The maximum number of shares of Common Stock subject to all awards that are granted during any
                            fiscal year to any individual under this Plan is 500,000 shares.  This limit does not apply, however, to
                            shares delivered in respect of compensation earned but deferred.

                    (d)    Additional limits with respect to Performance-Based Awards are set forth in Section 5.2.3.

                    (e)    In no event will greater than ten percent (10%) of the total shares of Common Stock available for
                            award grant purposes under this Plan be used for purposes of granting certain "Special Full-Value
                            Awards" referred to in Section 5.1.4.

                    Each of the foregoing numerical limits is subject to adjustment as contemplated by Section 4.3, Section 7.1,
                    and Section 8.10.  

            4.3    Awards Settled in Cash, Reissue of Awards and Shares.  To the extent that an award is settled in cash
                    or a form other than shares of Common Stock, the shares that would have been delivered had there been no
                    such cash or other settlement shall not be counted against the shares available for issuance under this Plan.
                    In the event that shares of Common Stock are delivered in respect of a dividend equivalent right, only the
                    actual number of shares delivered with respect to the award shall be counted against the share limits of this
                    Plan.  To the extent that shares of Common Stock are delivered pursuant to the exercise of a stock option,
                    the number of underlying shares as to which the exercise related shall be counted against the applicable
                    share limits under Section 4.2, as opposed to only counting the shares actually issued.  Shares that are
                    subject to or underlie awards which expire or for any reason are cancelled or terminated, are forfeited, fail to
                    vest, or for any other reason are not paid or delivered under this Plan shall again be available for subsequent
                    awards under this Plan.  Refer to Section 8.10 for application of the foregoing share limits with respect to
                    assumed awards.  The foregoing adjustments to the share limits of this Plan are subject to any applicable
                    limitations under Section 162(m) of the Code with respect to awards intended as performance-based
                    compensation thereunder.

4.4    Reservation of Shares; No Fractional Shares; Minimum Issue.  The Corporation shall at all times reserve
                    a number of shares of Common Stock sufficient to cover the Corporation's obligations and contingent
                    obligations to deliver shares with respect to awards then outstanding under this Plan (exclusive of any
                    dividend equivalent obligations to the extent the Corporation has the right to settle such rights in cash). 
                    No fractional shares shall be delivered under this Plan.  The Administrator may pay cash in lieu of any
                    fractional shares in settlements of awards under this Plan.  No fewer than 100 shares may be purchased on
                    exercise of any award (or, in the case of stock purchase rights, no fewer than 100 rights may be exercised
                    at any one time) unless the total number purchased or exercised is the total number at the time available
                    for purchase or exercise under the award.

5.        AWARDS

            5.1    Type and Form of Awards.  The Administrator shall determine the type or types of award(s) to be made
                    to each selected Eligible Person.  Awards may be granted singly, in combination or in tandem.  Awards
                    also may be made in combination or in tandem with, in replacement of, as alternatives to, or as the
                    payment form for grants or rights under any other employee or compensation plan of the Corporation or
                    one of its Subsidiaries.  The types of awards that may be granted under this Plan are:

                    5.1.1    Stock Options.  A stock option is the grant of a right to purchase a specified number of shares of
                                Common Stock during a specified period as determined by the Administrator.  An option may be
                                intended as an incentive stock option within the meaning of Section 422 of the Code (an "ISO") or
                                a nonqualified stock option (an option not intended to be an ISO).  The award agreement for an
                                option will indicate if the option is intended as an ISO; otherwise it will be deemed to be a
                                nonqualified stock option.  The maximum term of each option (ISO or nonqualified) shall be ten (10)
                                years.  The per share exercise price for each option shall be not less than 100% of the fair market
                          

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                                value of a share of Common Stock on the date of grant of the option, except in the case of a stock
                                option granted retroactively in tandem with or as a substitution for another award, the per share
                                exercise price may be no lower than the fair market value of a share of Common Stock on the date
                                such other award was granted (to the extent consistent with Sections 422 and 424 of the Code in
                                the case of options intended as incentive stock options).  When an option is exercised, the exercise
                                price for the shares to be purchased shall be paid in full in cash or such other method permitted by
                                the Administrator consistent with Section 5.5.

                  5.1.2    Additional Rules Applicable to ISOs.  To the extent that the aggregate fair market value
                                (determined at the time of grant of the applicable option) of stock with respect to which ISOs first
                                become exercisable by a participant in any calendar year exceeds $100,000, taking into account both
                                Common Stock subject to ISOs under this Plan and stock subject to ISOs under all other plans of the
                                Corporation or one of its Subsidiaries (or any parent or predecessor corporation to the extent required
                                by and within the meaning of Section 422 of the Code and the regulations promulgated thereunder),
                                such options shall be treated as nonqualified stock options.  In reducing the number of options treated
                                as ISOs to meet the $100,000 limit, the most recently granted options shall be reduced first.  To the
                                extent a reduction of simultaneously granted options is necessary to meet the $100,000 limit, the
                                Administrator may, in the manner and to the extent permitted by law, designate which shares of 
                                Common Stock are to be treated as shares acquired pursuant to the exercise of an ISO.  ISOs may
                                only be granted to employees of the Corporation or one of its subsidiaries (for this purpose, the term
                                "subsidiary" is used as defined in Section 424(f) of the Code, which generally requires an unbroken
                                chain of ownership of at least 50% of the total combined voting power of all classes of stock of each
                                subsidiary in the chain beginning with the Corporation and ending with the subsidiary in question). 
                                There shall be imposed in any award agreement relating to ISOs such other terms and conditions
                                as from time to time are required in order that the option be an "incentive stock option" as that term
                                is defined in Section 422 of the Code.  No ISO may be granted to any person who, at the time the
                                option is granted, owns (or is deemed to own under Section 424(d) of the Code) shares of
                                outstanding Common Stock possessing more than 10% of the total combined voting power of all
                                classes of stock of the Corporation, unless the exercise price of such option is at least 110% of
                                the fair market value of the stock subject to the option and such option by its terms is not
                                exercisable after the expiration of five years from the date such option is granted.

                    5.1.3    Other Awards.  The other types of awards that may be granted under this Plan include: (a) stock
                                bonuses, restricted stock, performance stock, stock units, phantom stock, dividend equivalents, or
                                similar rights to purchase or acquire shares, whether at a fixed or variable price or ratio related to the
                                Common Stock, upon the passage of time, the occurrence of one or more events, or the satisfaction
                                of performance criteria or other conditions, or any combination thereof; (b) any similar securities with
                                a value derived from the value of or related to the Common Stock and/or returns thereon; or (c) cash
                                awards granted consistent with Section 5.2 below.

                    5.1.4    Minimum Vesting Requirements.  Except for any accelerated vesting required or permitted pursuant
                                to Section 7 and except as otherwise provided in the following provisions of this Section 5.1.4, and
                                subject to such additional vesting requirements or conditions as the Administrator may establish with
                                respect to the award, each award granted under this Plan that is a Full-Value Award (as defined
                                below) and payable in shares of Common Stock shall be subject to the following minimum vesting
                                requirements:  (a) if the award includes a performance-based vesting condition, the award shall not
                                vest earlier than the first anniversary of the date of grant of the award and vesting shall occur only
                                if the award holder is employed by, a director of, or otherwise providing services to the Corporation
                                or one of its Subsidiaries on such vesting date; and (b) if the award does not include a
                                performance-based vesting condition, the award shall not vest more rapidly than in monthly
                                installments over the three-year period immediately following the date of grant of the award and
                                vesting of any vesting installment of the award shall occur only if the award holder is employed by,
                                a director of, or otherwise providing services to the Corporation or one of its Subsidiaries on the date
                                such installment is scheduled to vest; provided that the Administrator may accelerate or provide in
                                the applicable award agreement for the accelerated vesting of any Full-Value Award in connection
                                with a change in control of the award holder's employer (or a parent thereof) or the reportable
                                segment of the Corporation that employs the award holder, the termination of the award holder's

5

                                employment (including a termination of employment due to the award holder's death, disability or
                                retirement, but not including a termination of employment by the award holder's employer for
                                cause), or as consideration or partial consideration for a release by the award holder of pending
                                or threatened claims against the Corporation, the award holder's employer, or any of their
                                respective officers, directors or other affiliates (regardless of whether the release is given in
                                connection with a termination of employment by the award holder's employer for cause or other
                                circumstances).  The Administrator may, however, accelerate or provide in the applicable award
                                agreement for the accelerated vesting of any Full-Value Award in circumstances not contemplated
                                by the preceding sentence, and/or provide for a vesting schedule that is shorter than the minimum
                                schedule contemplated by the preceding sentence, in such circumstances as the Administrator
                                may deem appropriate; provided, however, that the portion of any such Full-Value Award that
                                vests earlier than the minimum vesting dates that would be applicable pursuant to the minimum
                                vesting requirements of the preceding sentence (or, as to any accelerated vesting, provides for
                                accelerated vesting other than in the circumstances contemplated by the preceding sentence)
                                shall count against the applicable share limits of Section 4.2 as a Special Full-Value Award.  For
                                purposes of this Plan, a "Full-Value Award" means any award under this Plan that is
                                neither: (1) a delivery of shares in respect of compensation earned but deferred nor (2) a stock option.

5.2   Section 162(m) Performance-Based Awards.  Without limiting the generality of the foregoing, any of the
                    types of awards listed in Section 5.1.3 above may be, and options granted with an exercise price not less
                    than the fair market value of a share of Common Stock at the date of grant ("Qualifying Options")
                    typically will be, granted as awards intended to satisfy the requirements for "performance-based
                    compensation" within the meaning of Section 162(m) of the Code ("Performance-Based Awards").  The
                    grant, vesting, exercisability or payment of Performance-Based Awards may depend (or, in the case of
                    Qualifying Options, may also depend) on the degree of achievement of one or more performance goals
                    relative to a pre-established targeted level or level using one or more of the Business Criteria set forth
                    below (on an absolute or relative basis) for the Corporation on a consolidated basis or for one or more of
                    the Corporation's subsidiaries, segments, divisions or business units, or any combination of the foregoing.
                    Any Qualifying Option shall be subject only to the requirements of Sections 5.2.1 and 5.2.3 in order for
                    such award to satisfy the requirements for "performance-based compensation" under Section 162(m) of the
                    Code.  Any other Performance-Based Award shall be subject to all of the following provisions of this
                    Section 5.2.

                    5.2.1     Class; Administrator.  The eligible class of persons for Performance-Based Awards under this
                                Section 5.2 shall be officers and employees of the Corporation or one of its Subsidiaries.  The
                                Administrator approving Performance-Based Awards or making any certification required pursuant
                                to Section 5.2.4 must be constituted as provided in Section 3.1 for awards that are intended as
                                performance-based compensation under Section 162(m) of the Code.

                    5.2.2     Performance Goals.  The specific performance goals for Performance-Based Awards (other than
                                Qualifying Options) shall be, on an absolute or relative basis, established based on one or more
                                of the following business criteria ("Business Criteria") as selected by the Administrator in its sole
                                discretion:  earnings per share, cash flow (which means cash and cash equivalents derived from
                                either net cash flow from operations or net cash flow from operations, financing and investing
                                activities), total shareholder return, gross revenue, revenue growth, operating income (before or
                                after taxes), net earnings (before or after interest, taxes, depreciation and/or amortization), return
                                on equity or on assets or on net investment, cost containment or reduction, or any combination
                                thereof.  These terms are used as applied under generally accepted accounting principles or in
                                the financial reporting of the Corporation or of its Subsidiaries.  To qualify awards as
                                performance-based under Section 162(m), the applicable Business Criterion (or Business Criteria,
                                as the case may be) and specific performance goal or goals ("targets") must be established and
                                approved by the Administrator during the first 90 days of the performance period (and, in the case
                                of performance periods of less than one year, in no event after 25% or more of the performance
                                period has elapsed) and while performance relating to such target(s) remains substantially
                                uncertain within the meaning of Section 162(m) of the Code.  Performance targets shall be
                                adjusted to mitigate the unbudgeted impact of material, unusual or nonrecurring gains and losses,
                                accounting changes or other extraordinary events not foreseen at the time the targets were set
                                unless the Administrator provides otherwise at the time of establishing the targets.  The applicable
                                performance measurement period may not be less than three months nor more than 10 years.

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                    5.2.3     Form of Payment; Maximum Performance-Based Award.  Grants or awards under this
                                Section 5.2 may be paid in cash or shares of Common Stock or any combination thereof.  Grants
                                of Qualifying Options to any one participant in any one fiscal year shall be subject to the limit set
                                forth in Section 4.2(b).  The maximum number of shares of Common Stock which may be delivered
                                pursuant to Performance-Based Awards (other than Qualifying Options and other than cash awards
                                covered by the following sentence) that are granted to any one participant in any one fiscal year
                                shall not exceed 100,000 shares, either individually or in the aggregate, subject to adjustment as
                                provided in Section 7.1.  In addition, the aggregate amount of compensation to be paid to any one
                                participant in respect of all Performance-Based Awards payable only in cash and not related to
                                shares of Common Stock and granted to that participant in any one fiscal year shall not exceed
                                $1,000,000.  Awards that are cancelled during the year shall be counted against these limits to the
                                extent permitted by Section 162(m) of the Code.

                    5.2.4    Certification of Payment.  Before any Performance-Based Award under this Section 5.2 (other than
                                Qualifying Options) is paid and to the extent required to qualify the award as performance-based
                                compensation within the meaning of Section 162(m) of the Code, the Administrator must certify in
                                writing that the performance target(s) and any other material terms of the Performance-Based Award
                                were in fact timely satisfied.

                    5.2.5    Reservation of Discretion.  The Administrator will have the discretion to determine the restrictions
                                or other limitations of the individual awards granted under this Section 5.2 including the authority to
                                reduce awards, payouts or vesting or to pay no awards, in its sole discretion, if the Administrator
                                preserves such authority at the time of grant by language to this effect in its authorizing resolutions
                                or otherwise.

                    5.2.6    Expiration of Grant Authority.  As required pursuant to Section 162(m) of the Code and the
                                regulations promulgated thereunder, the Administrator's authority to grant new awards that are
                                intended to qualify as performance-based compensation within the meaning of Section 162(m) of
                                the Code (other than Qualifying Options) shall terminate upon the first meeting of the Corporation's
                                shareholders that occurs in the fifth year following the year in which the Corporation's shareholders
                                first approve this restated Plan.

            5.3    Award Agreements.  Each award shall be evidenced by a written award agreement in the form approved by
                    the Administrator and executed on behalf of the Corporation and, if required by the Administrator, executed
                    by the recipient of the award.  The Administrator may authorize any officer of the Corporation (other than the
                    particular award recipient) to execute any or all award agreements on behalf of the Corporation.  The award
                    agreement shall set forth the material terms and conditions of the award as established by the Administrator
                    consistent with the express limitations of this Plan.

           5.4    Deferrals and Settlements.  Payment of awards may be in the form of cash, Common Stock, other awards
                    or combinations thereof as the Administrator shall determine, and with such restrictions as it may impose. 
                    The Administrator may also require or permit participants to elect to defer the issuance of shares or the
                    settlement of awards in cash under such rules and procedures as it may establish under this Plan.  The
                    Administrator may also provide that deferred settlements include the payment or crediting of interest or other
                    earnings on the deferral amounts, or the payment or crediting of dividend equivalents where the deferred
                    amounts are denominated in shares.

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5.5    Consideration for Common Stock or Awards.  The purchase price for any award granted under this Plan
                    or the Common Stock to be delivered pursuant to an award, as applicable, may be paid by means of any
                    lawful consideration as determined by the Administrator, including, without limitation, one or a combination
                    of the following methods:

                    •    services rendered by the recipient of such award;

                    •    cash, check payable to the order of the Corporation, or electronic funds transfer;

                    •    notice and third party payment in such manner as may be authorized by the Administrator;

                    •    the delivery of previously owned shares of Common Stock;

                    •    by a reduction in the number of shares otherwise deliverable pursuant to the award; or

                    •    subject to such procedures as the Administrator may adopt, pursuant to a "cashless exercise" with a
                         third party who provides financing for the purposes of (or who otherwise facilitates) the purchase or
                         exercise of awards.

                    In no event shall any shares newly-issued by the Corporation be issued for less than the minimum lawful
                    consideration for such shares or for consideration other than consideration permitted by applicable state law. 
                    In the event that the Administrator allows a participant to exercise an award by delivering shares of Common
                    Stock previously owned by such participant and unless otherwise expressly provided by the Administrator,
                    any shares delivered which were initially acquired by the participant from the Corporation (upon exercise of a
                    stock option or otherwise) must have been owned by the participant at least six months as of the date of
                    delivery.  Shares of Common Stock used to satisfy the exercise price of an option shall be valued at their fair
                    market value on the date of exercise.  The Corporation will not be obligated to deliver any shares unless and
                    until it receives full payment of the exercise or purchase price therefore and any related withholding
                    obligations under Section 8.5 and any other conditions to exercise or purchase have been satisfied.  Unless
                    otherwise expressly provided in the applicable award agreement, the Administrator may at any time eliminate
                    or limit a participant's ability to pay the purchase or exercise price of any award or shares by any method
                    other than cash payment to the Corporation.

5.6    Definition of Fair Market Value.  For purposes of this Plan, "fair market value" shall mean, unless otherwise
                    determined or provided by the Administrator in the circumstances, the closing price for a share of Common
                    Stock as reported on the composite tape for securities listed in the New York Stock Exchange
                    (the "Exchange") for the date in question or, if no sales of Common Stock were made on the Exchange on
                    that date, the closing price for a share of Common Stock as reported on said composite tape for the next
                    preceding day on which sales of Common Stock were made on the Exchange.  The Administrator may,
                    however, provide with respect to one or more awards that the fair market value shall equal the last closing
                    price for a share of Common Stock as reported on the composite tape for securities listed on the Exchange
                    available on the date in question or the average of the high and low trading prices of a share of Common
                    Stock as reported on the composite tape for securities listed on the Exchange for the date in question or the
                    most recent trading day.  If the Common Stock is no longer listed or is no longer actively traded on the
                    Exchange as of the applicable date, the fair market value of the Common Stock shall be the value as
                    reasonably determined by the Administrator for purposes of the award in the circumstances.  The
                    Administrator also may adopt a different methodology for determining fair market value with respect to one
                    or more awards if a different methodology is necessary or advisable to secure any intended favorable tax,
                    legal or other treatment for the particular award(s) (for example, and without limitation, the Administrator
                    may provide that fair market value for purposes of one or more awards will be based on an average of
                    closing prices (or the average of high and low daily trading prices) for a specified period preceding the
                    relevant date). 

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            5.7    Transfer Restrictions.

                    5.7.1    Limitations on Exercise and Transfer.  Unless otherwise expressly provided in (or pursuant to) this
                                Section 5.7, by applicable law and by the award agreement, as the same may be amended, (a) all
                                awards are non-transferable and shall not be subject in any manner to sale, transfer, anticipation,
                                alienation, assignment, pledge, encumbrance or charge; (b) awards shall be exercised only by the
                                participant; and (c) amounts payable or shares issuable pursuant to any award shall be delivered
                                only to (or for the account of) the participant.

                    5.7.2    Exceptions.  The Administrator may permit awards to be exercised by and paid to, or otherwise
                                transferred to, other persons or entities pursuant to such conditions and procedures, including
                                limitations on subsequent transfers, as the Administrator may, in its sole discretion, establish in
                                writing.  Any permitted transfer shall be subject to compliance with applicable federal and state
                                securities laws and shall not be a transfer for value (other nominal consideration, settlement of
                                marital property rights, or for interests in an entity in which more than fifty percent of the voting
                                interests are held by the Eligible Person or by the Eligible Person's family members).

                    5.7.3    Further Exceptions to Limits on Transfer.  The exercise and transfer restrictions in
                                Section 5.7.1 shall not apply to:

                                (a)    transfers to the Corporation,

                                (b)    the designation of a beneficiary to receive benefits in the event of the participant's death
                                        or, if the participant has died, transfers to or exercise by the participant's beneficiary, or,
                                        in the absence of a validly designated beneficiary, transfers by will or the laws of descent
                                        and distribution,

                                (c)    subject to any applicable limitations on ISOs, transfers to a family member (or former family
                                        member) pursuant to a domestic relations order if approved or ratified by the Administrator,

                                (d)    if the participant has suffered a disability, permitted transfers or exercises on behalf of the
                                        participant by his or her legal representative, or

                                (e)    the authorization by the Administrator of "cashless exercise" procedures with third parties
                                        who provide financing for the purpose of (or who otherwise facilitate) the exercise of awards
                                        consistent with applicable laws and the express authorization of the Administrator.

            5.8    International Awards.  One or more awards may be granted to Eligible Persons who provide services to the
                    Corporation or one of its Subsidiaries outside of the United States.  Any awards granted to such persons
                    may be granted pursuant to the terms and conditions of any applicable sub-plans, if any, appended to this
                    Plan and approved by the Administrator.

6.        EFFECT OF TERMINATION OF SERVICE ON AWARDS

6.1    General.  The Administrator shall establish the effect of a termination of employment or service on the rights
                    and benefits under each award under this Plan and in so doing may make distinctions based upon, inter alia,
                    the cause of termination and type of award.  If the participant is not an employee of the Corporation or one of
                    its Subsidiaries and provides other services to the Corporation or one of its Subsidiaries, the Administrator
                    shall be the sole judge for purposes of this Plan (unless a contract or the award otherwise provides) of
                    whether the participant continues to render services to the Corporation or one of its Subsidiaries and the
                    date, if any, upon which such services shall be deemed to have terminated.

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           6.2    Events Not Deemed Terminations of Service.  Unless the express policy of the Corporation or one of its
                    Subsidiaries, or the Administrator, otherwise provides, the employment relationship shall not be considered
                    terminated in the case of (a) sick leave, (b) military leave, or (c) any other leave of absence authorized by the
                    Corporation or one of its Subsidiaries, or the Administrator; provided that unless reemployment upon the
                    expiration of such leave is guaranteed by contract or law, such leave is for a period of not more than 90 days.
                    In the case of any employee of the Corporation or one of its Subsidiaries on an approved leave of absence,
                    continued vesting of the award while on leave from the employ of the Corporation or one of its Subsidiaries
                    may be suspended until the employee returns to service, unless the Administrator otherwise provides or
                    applicable law otherwise requires.  In no event shall an award be exercised after the expiration of the term
                    set forth in the award agreement.

            6.3    Effect of Change of Subsidiary Status.  For purposes of this Plan and any award, if an entity ceases to
                    be a Subsidiary of the Corporation a termination of employment or service shall be deemed to have occurred
                    with respect to each Eligible Person in respect of such Subsidiary who does not continue as an Eligible
                    Person in respect of another entity within the Corporation or another Subsidiary that continues as such
                    after giving effect to the transaction or other event giving rise to the change in status.

7.        ADJUSTMENTS; ACCELERATION

            7.1    Adjustments.  Upon or in contemplation of: any reclassification, recapitalization, stock split (including a
                    stock split in the form of a stock dividend) or reverse stock split ("stock split"); any merger, combination,
                    consolidation, or other reorganization; any spin-off, split-up, or similar extraordinary dividend distribution in
                    respect of the Common Stock (whether in the form of securities or property); any exchange of Common
                    Stock or other securities of the Corporation, or any similar, unusual or extraordinary corporate transaction
                    in respect of the Common Stock; or a sale of all or substantially all the business or assets of the
                    Corporation as an entirety; then the Administrator shall, in such manner, to such extent (if any) and at
                    such time as it deems appropriate and equitable in the circumstances:

                    (a)    proportionately adjust any or all of (1) the number and type of shares of Common Stock (or other
                            securities) that thereafter may be made the subject of awards (including the specific share limits,
                            maximums and numbers of shares set forth elsewhere in this Plan), (2) the number, amount and type
                            of shares of Common Stock (or other securities or property) subject to any or all outstanding awards,
                            (3) the grant, purchase, or exercise price of any or all outstanding awards, (4) the securities, cash or
                            other property deliverable upon exercise or payment of any outstanding awards, or (5) (subject to
                            Section 8.8.3(a)) the performance standards applicable to any outstanding awards, or

                    (b)    make provision for a cash payment or for the assumption, substitution or exchange of any or all
                            outstanding share-based awards or the cash, securities or property deliverable to the holder of any or
                            all outstanding share-based awards, based upon the distribution or consideration payable to holders of
                            the Common Stock upon or in respect of such event.

                    The Administrator may adopt such valuation methodologies for outstanding awards as it deems reasonable
                    in the event of a cash or property settlement and, in the case of options, but without limitation on other
                    methodologies, may base such settlement solely upon the excess if any of the per share amount payable
                    upon or in respect of such event over the exercise price of the award.  With respect to any award of an ISO,
                    the Administrator may make such an adjustment that causes the option to cease to qualify as an ISO
                    without the consent of the affected participant.

                    In any of such events, the Administrator may take such action prior to such event to the extent that the
                    Administrator deems the action necessary to permit the participant to realize the benefits intended to be
                    conveyed with respect to the underlying shares in the same manner as is or will be available to shareholders
                    generally.  In the case of any stock split or reverse stock split, if no action is taken by the Administrator, the
                    proportionate adjustments contemplated by clause (a) above shall nevertheless be made.

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            7.2    Automatic Acceleration of Awards.  Upon a dissolution of the Corporation or other event described in
                    Section 7.1 that the Corporation does not survive (or does not survive as a public company in respect of its
                    Common Stock), then each then-outstanding option shall become fully vested, all shares of restricted stock
                    then outstanding shall fully vest free of restrictions, and each other award granted under this Plan that is
                    then outstanding shall become payable to the holder of such award; provided that such acceleration provision
                    shall not apply, unless otherwise expressly provided by the Administrator, with respect to any award to the
                    extent that the Administrator has made a provision for the substitution, assumption, exchange or other
                    continuation or settlement of the award, or the award would otherwise continue in accordance with its terms,
                    in the circumstances.

            7.3    Possible Acceleration of Awards.  Without limiting Section 7.2, in the event of a Change in Control Event
                    (as defined below), the Administrator may, in its discretion, provide that any outstanding option shall become
                    fully vested, that any share of restricted stock then outstanding shall fully vest free of restrictions, and that
                    any other award granted under this Plan that is then outstanding shall be payable to the holder of such
                    award.  The Administrator may take such action with respect to all awards then outstanding or only with
                    respect to certain specific awards identified by the Administrator in the circumstances.  For purposes of this
                    Plan, "Change in Control Event" means any of the following:

                    (a)    The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of
                            the Exchange Act (a "Person")) of beneficial ownership (within the meaning of Rule 13d-3 promulgated
                            under the Exchange Act) of more than 20% of either (1) the then-outstanding shares of common stock
                            of the Corporation (the "Outstanding Company Common Stock") or (2) the combined voting power of
                            the then-outstanding voting securities of the Corporation entitled to vote generally in the election of
                            directors (the "Outstanding Company Voting Securities"); provided, however, that, for purposes of
                            this clause (a), the following acquisitions shall not constitute a Change in Control Event; (A) any
                            acquisition directly from the Corporation, (B) any acquisition by the Corporation, (C) any acquisition by
                            any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any affiliate
                            of the Corporation or a successor, or (D) any acquisition by any entity pursuant to a transaction that
                            complies with Sections (c)(1), (2) and (3) below;

                    (b)    Individuals who, as of the Effective Date, constitute the Board (the "Incumbent Board") cease for any
                            reason to constitute at least a majority of the Board; provided, however, that any individual becoming a
                            director subsequent to the Effective Date whose election, or nomination for election by the Corporation's
                            shareholders, was approved by a vote of at least two-thirds of the directors then comprising the
                            Incumbent Board (including for these purposes, the new members whose election or nomination was so
                            approved, without counting the member and his predecessor twice) shall be considered as though such
                            individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual
                            whose initial assumption of office occurs as a result of an actual or threatened election contest with
                            respect to the election or removal of directors or other actual or threatened solicitation of proxies or
                            consents by or on behalf of a Person other than the Board;

                  (c)    Consummation of a reorganization, merger, statutory share exchange or consolidation or similar
                            corporate transaction involving the Corporation or any of its Subsidiaries, a sale or other disposition of
                            all or substantially all of the assets of the Corporation, or the acquisition of assets or stock of another
                            entity by the Corporation or any of its Subsidiaries (each, a "Business Combination"), in each case
                            unless, following such Business Combination, (1) all or substantially all of the individuals and entities
                            that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding
                            Company Voting Securities immediately prior to such Business Combination beneficially own, directly
                            or indirectly, more than 60% of the then-outstanding shares of common stock and the combined voting
                            power of the then-outstanding voting securities entitled to vote generally in the election of directors, as
                            the case may be, of the entity resulting from such Business Combination (including, without limitation,
                            an entity that, as a result of such transaction, owns the Corporation or all or substantially all of the
 

11

                            Corporation's assets directly or through one or more subsidiaries (a "Parent")) in substantially the same
                            proportions as their ownership immediately prior to such Business Combination of the Outstanding
                            Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (2) no
                            Person (excluding any entity resulting from such Business Combination or a Parent or any employee
                            benefit plan (or related trust) of the Corporation or such entity resulting from such Business
                            Combination or Parent) beneficially owns, directly or indirectly, more than 20% of, respectively, the
                            then-outstanding shares of common stock of the entity resulting from such Business Combination or
                            the combined voting power of the then-outstanding voting securities of such entity, except to the extent
                            that the ownership in excess of 20% existed prior to the Business Combination, and (3) at least a
                            majority of the members of the board of directors or trustees of the entity resulting from such Business
                            Combination or a Parent were members of the Incumbent Board at the time of the execution of the
                            initial agreement or of the action of the Board providing for such Business Combination; or

                    (d)    Approval by the shareholders of the Corporation of a complete liquidation or dissolution of the
                            Corporation other than in the context of a transaction that does not constitute a Change in Control
                            Event under clause (c) above.

            7.4    Early Termination of Awards.  Any award that has been accelerated as required or contemplated by
                    Section 7.2 or 7.3 (or would have been so accelerated but for Section 7.5, 7.6 or 7.7) shall terminate upon the
                    related event referred to in Section 7.2 or 7.3, as applicable, subject to any provision that has been expressly
                    made by the Administrator, through a plan of reorganization or otherwise, for the survival, substitution,
                    assumption, exchange or other continuation or settlement of such award and provided that, in the case of
                    options that will not survive, be substituted for, assumed, exchanged, or otherwise continued or settled in the
                    transaction, the holder of such award shall be given reasonable advance notice of the impending termination
                    and a reasonable opportunity to exercise his or her outstanding options in accordance with their terms before
                    the termination of such awards (except that in no case shall more than ten days' notice of accelerated vesting
                    and the impending termination be required and any acceleration may be made contingent upon the actual
                    occurrence of the event).

            7.5    Other Acceleration Rules.  Any acceleration of awards pursuant to this Section 7 shall comply with
                    applicable legal requirements and, if necessary to accomplish the purposes of the acceleration or if the
                    circumstances require, may be deemed by the Administrator to occur a limited period of time not greater
                    than 30 days before the event.  Without limiting the generality of the foregoing, the Administrator may deem
                    an acceleration to occur immediately prior to the applicable event and/or reinstate the original terms of an
                    award if an event giving rise to an acceleration does not occur.  The Administrator may override the
                    provisions of Section 7.2, 7.3, 7.4 and/or 7.6 by express provision in the award agreement and may accord
                    any Eligible Person a right to refuse any acceleration, whether pursuant to the award agreement or
                    otherwise, in such circumstances as the Administrator may approve.  The portion of any ISO accelerated in
                    connection with a Change in Control Event or any other action permitted hereunder shall remain exercisable
                    as an ISO only to the extent the applicable $100,000 limitation on ISOs is not exceeded.  To the extent
                    exceeded, the accelerated portion of the option shall be exercisable as a nonqualified stock option under
                    the Code.

            7.6    Possible Rescission of Acceleration.  If the vesting of an award has been accelerated expressly in
                    anticipation of an event or upon shareholder approval of an event and the Administrator later determines that
                    the event will not occur, the Administrator may rescind the effect of the acceleration as to any then
                    outstanding and unexercised or otherwise unvested awards.

            7.7    Golden Parachute Limitation.  Notwithstanding anything else contained in this Section 7 to the contrary,
                    in no event shall an award be accelerated under this Plan to an extent or in a manner which would not be
                    fully deductible by the Corporation or one of its Subsidiaries for federal income tax purposes because of
                    Section 280G of the Code, nor shall any payment hereunder be accelerated to the extent any portion of
                    such accelerated payment would not be deductible by the Corporation or one of its Subsidiaries because
                    of Section 280G of the Code.  If a participant would be entitled to benefits or payments hereunder and under
                    any other plan or program that would constitute "parachute payments" as defined in Section 280G of the
                    Code, then the participant may by written notice to the Corporation designate the order in which such
 

12

                    parachute payments will be reduced or modified so that the Corporation or one of its Subsidiaries is not
                    denied federal income tax deductions for any "parachute payments" because of Section 280G of the Code. 
                    Notwithstanding the foregoing, if a participant is a party to an employment or other agreement with the
                    Corporation or one of its Subsidiaries, or is a participant in a severance program sponsored by the
                    Corporation or one of its Subsidiaries, that contains express provisions regarding Section 280G and/or
                    Section 4999 of the Code (or any similar successor provision), the Section 280G and/or Section 4999
                    provisions of such employment or other agreement or plan, as applicable, shall control as to any awards
                    held by that participant (for example, and without limitation, a participant may be a party to an employment
                    agreement with the Corporation or one of its Subsidiaries that provides for a "gross-up" as opposed to a
                    "cut-back" in the event that the Section 280G thresholds are reached or exceeded in connection with a
                    change in control and, in such event, the Section 280G and/or Section 4999 provisions of such employment
                    agreement shall control as to any awards held by that participant).

8.        OTHER PROVISIONS

            8.1    Compliance with Laws.  This Plan, the granting and vesting of awards under this Plan, the offer, issuance
                    and delivery of shares of Common Stock, the acceptance of promissory notes and/or the payment of money
                    under this Plan or under awards are subject to compliance with all applicable federal and state laws, rules
                    and regulations (including but not limited to state and federal securities law, federal margin requirements)
                    and to such approvals by any listing, regulatory or governmental authority as may, in the opinion of counsel
                    for the Corporation, be necessary or advisable in connection therewith.  The person acquiring any securities
                    under this Plan will, if requested by the Corporation or one of its Subsidiaries, provide such assurances and
                    representations to the Corporation or one of its Subsidiaries as the Administrator may deem necessary or
                    desirable to assure compliance with all applicable legal and accounting requirements.

            8.2    No Rights to Award.  No person shall have any claim or rights to be granted an award (or additional
                    awards, as the case may be) under this Plan, subject to any express contractual rights (set forth in a
                    document other than this Plan) to the contrary.

            8.3    No Employment/Service Contract.  Nothing contained in this Plan (or in any other documents under this
                    Plan or in any award) shall confer upon any Eligible Person or other participant any right to continue in the
                    employ or other service of the Corporation or one of its Subsidiaries, constitute any contract or agreement of
                    employment or other service or affect an employee's status as an employee at will, nor shall interfere in any
                    way with the right of the Corporation or one of its Subsidiaries to change a person's compensation or other
                    benefits, or to terminate his or her employment or other service, with or without cause.  Nothing in this
                    Section 8.3, however, is intended to adversely affect any express independent right of such person under a
                    separate employment or service contract other than an award agreement.

            8.4    Plan Not Funded.  Awards payable under this Plan shall be payable in shares or from the general assets
                    of the Corporation, and no special or separate reserve, fund or deposit shall be made to assure payment of
                    such awards.  No participant, beneficiary or other person shall have any right, title or interest in any fund or
                    in any specific asset (including shares of Common Stock, except as expressly otherwise provided) of the
                    Corporation or one of its Subsidiaries by reason of any award hereunder.  Neither the provisions of this Plan
                    (or of any related documents), nor the creation or adoption of this Plan, nor any action taken pursuant to the
                    provisions of this Plan shall create, or be construed to create, a trust of any kind or a fiduciary relationship
                    between the Corporation or one of its Subsidiaries and any participant, beneficiary or other person.  To the
                    extent that a participant, beneficiary or other person acquires a right to receive payment pursuant to any
                    award hereunder, such right shall be no greater than the right of any unsecured general creditor of the
                    Corporation.

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8.5    Tax Withholding.  Upon any exercise, vesting, or payment of any award or upon the disposition of shares
                    of Common Stock acquired pursuant to the exercise of an ISO prior to satisfaction of the holding period
                    requirements of Section 422 of the Code, the Corporation or one of its Subsidiaries shall have the right at its
                    option to:

                    (a)    require the participant (or the participant's personal representative or beneficiary, as the case may be)
                            to pay or provide for payment of at least the minimum amount of any taxes which the Corporation or
                            one of its Subsidiaries may be required to withhold with respect to such award event or payment; or

                    (b)    deduct from any amount otherwise payable in cash to the participant (or the participant's personal
                            representative or beneficiary, as the case may be) the minimum amount of any taxes which the
                            Corporation or one of its Subsidiaries may be required to withhold with respect to such cash payment.

                    In any case where a tax is required to be withheld in connection with the delivery of shares of Common
                    Stock under this Plan, the Administrator may in its sole discretion (subject to Section 8.1) grant (either at
                    the time of the award or thereafter) to the participant the right to elect, pursuant to such rules and subject
                    to such conditions as the Administrator may establish, to have the Corporation reduce the number of
                    shares to be delivered by (or otherwise reacquire) the appropriate number of shares, valued in a consistent
                    manner at their fair market value or at the sales price in accordance with authorized procedures for
                    cashless exercises, necessary to satisfy the minimum applicable withholding obligation on exercise, vesting
                    or payment.  In no event shall the shares withheld exceed the minimum whole number of shares required for
                    tax withholding under applicable law.  The Corporation may, with the Administrator's approval, accept one or
                    more promissory notes from any Eligible Person in connection with taxes required to be withheld upon the
                    exercise, vesting or payment of any award under this Plan; provided that any such note shall be subject to
                    terms and conditions established by the Administrator and the requirements of applicable law. 

            8.6    Effective Date, Termination and Suspension, Amendments.

                    8.6.1    Effective Date.  This Plan is effective as of July 25, 2005, the date of its approval by the Board
                                (the "Effective Date").  This Plan shall be submitted for and subject to shareholder approval no
                                later than twelve months after the Effective Date.  Unless earlier terminated by the Board, this
                                Plan shall terminate at the close of business on the day before the tenth anniversary of the
                                Effective Date.  After the termination of this Plan either upon such stated expiration date or its
                                earlier termination by the Board, no additional awards may be granted under this Plan, but
                                previously granted awards (and the authority of the Administrator with respect thereto, including
                                the authority to amend such awards) shall remain outstanding in accordance with their applicable
                                terms and conditions and the terms and conditions of this Plan.

                    8.6.2    Board Authorization.  The Board may, at any time, terminate or, from time to time, amend,
                                modify or suspend this Plan, in whole or in part.  No awards may be granted during any period
                                that the Board suspends this Plan.

                    8.6.3    Shareholder Approval.  An amendment to this Plan shall be subject to shareholder approval:
                                (a) to the extent then required by applicable law or any applicable listing agency or required
                                under Section 162, 422 or 424 of the Code to preserve the intended tax consequences of this
                                Plan, (b) if shareholder approval for the amendment is otherwise deemed necessary or advisable
                                by the Board or (c) if the amendment increases the Share Limit set forth in Section 4.2.

                    8.6.4     Amendments to Awards.  Without limiting any other express authority of the Administrator under
                                (but subject to) the express limits of this Plan, the Administrator by agreement or resolution may
                                waive conditions of or limitations on awards to participants that the Administrator in the prior exercise
                                of its discretion has imposed, without the consent of a participant, and (subject to the requirements
                                of Sections 3.2 and 8.6.5) may make other changes to the terms and conditions of awards.  Any
                                amendment or other action that would constitute a repricing of an award is subject to the limitations
                                set forth in Section 3.2(g).

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                    8.6.5     Limitations on Amendments to Plan and Awards.  No amendment, suspension or termination of
                                this Plan or amendment of any outstanding award agreement shall, without written consent of the
                                participant, affect in any manner materially adverse to the participant any rights or benefits of the
                                participant or obligations of the Corporation under any award granted under this Plan prior to the
                                effective date of such change.  Changes, settlements and other actions contemplated by Section 7
                                shall not be deemed to constitute changes or amendments for purposes of this Section 8.6.

            8.7    Privileges of Stock Ownership.  Except as otherwise expressly authorized by the Administrator or this
                    Plan, a participant shall not be entitled to any privilege of stock ownership as to any shares of Common
                    Stock not actually delivered to and held of record by the participant.  No adjustment will be made for
                    dividends or other rights as a shareholder for which a record date is prior to such date of delivery.

            8.8    Governing Law; Construction; Severability.

                    8.8.1    Choice of Law.  This Plan, the awards, all documents evidencing awards and all other related
                                documents shall be governed by, and construed in accordance with the laws of the State
                                of Minnesota.

                    8.8.2    Severability.  If a court of competent jurisdiction holds any provision invalid and unenforceable,
                                the remaining provisions of this Plan shall continue in effect.

                    8.8.3    Plan Construction.

                                (a)    Rule 16b-3.  It is the intent of the Corporation that the awards and transactions permitted
                                        by awards be interpreted in a manner that, in the case of participants who are or may
                                        be subject to Section 16 of the Exchange Act, qualify, to the maximum extent compatible
                                        with the express terms of the award, for exemption from matching liability under Rule 16b-3
                                        promulgated under the Exchange Act.  Notwithstanding the foregoing, the Corporation shall
                                        have no liability to any participant for Section 16 consequences of awards or events under
                                        awards if an award or event does not so qualify.

                            (b)    Section 162(m).  Awards under Section 5.1.3 to persons described in Section 5.2 that are
                                        either granted or become vested, exercisable or payable based on attainment of one or
                                        more performance goals related to the Business Criteria, as well as Qualifying Options
                                        granted to persons described in Section 5.2, that are approved by a committee composed
                                        solely of two or more outside directors (as this requirement is applied under Section 162(m)
                                        of the Code) shall be deemed to be intended as performance-based compensation within
                                        the meaning of Section 162(m) of the Code unless such committee provides otherwise at
                                        the time of grant of the award.  It is the further intent of the Corporation that (to the extent
                                        the Corporation or one of its Subsidiaries or awards under this Plan may be or become
                                        subject to limitations on deductibility under Section 162(m) of the Code) any such awards
                                        and any other Performance-Based Awards under Section 5.2 that are granted to or held
                                        by a person subject to Section 162(m) will qualify as performance-based compensation
                                        or otherwise be exempt from deductibility limitations under Section 162(m).

            8.9   Captions.  Captions and headings are given to the sections and subsections of this Plan solely as a
                    convenience to facilitate reference.  Such headings shall not be deemed in any way material or
                    relevant to the construction or interpretation of this Plan or any provision thereof.

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            8.10  Stock-Based Awards in Substitution for Stock Options or Awards Granted by Other Corporation.
                    Awards may be granted to Eligible Persons in substitution for or in connection with an assumption of
                    employee stock options, restricted stock or other stock-based awards granted by other entities to
                    persons who are or who will become Eligible Persons in respect of the Corporation or one of its
                    Subsidiaries, in connection with a distribution, merger or other reorganization by or with the granting
                    entity or an affiliated entity, or the acquisition by the Corporation or one of its Subsidiaries, directly or
                    indirectly, of all or a substantial part of the stock or assets of the employing entity.  The awards so
                    granted need not comply with other specific terms of this Plan, provided the awards reflect only
                    adjustments giving effect to the assumption or substitution consistent with the conversion applicable to
                    the Common Stock in the transaction and any change in the issuer of the security.  Any shares that
                    are delivered and any awards that are granted by, or become obligations of, the Corporation, as a result
                    of the assumption by the Corporation of, or in substitution for, outstanding awards previously granted by
                    an acquired company (or previously granted by a predecessor employer (or direct or indirect parent
                    thereof) in the case of persons that become employed by the Corporation or one of its Subsidiaries in
                    connection with a business or asset acquisition or similar transaction) shall not be counted against the
                    Share Limit or other limits on the number of shares available for issuance under this Plan.

            8.11  Non-Exclusivity of Plan.  Nothing in this Plan shall limit or be deemed to limit the authority of the
                    Board or the Administrator to grant awards or authorize any other compensation, with or without
                    reference to the Common Stock, under any other plan or authority.

            8.12  No Corporate Action Restriction.  The existence of this Plan, the award agreements and the awards
                    granted hereunder shall not limit, affect or restrict in any way the right or power of the Board or the
                    shareholders of the Corporation to make or authorize: (a) any adjustment, recapitalization, reorganization
                    or other change in the capital structure or business of the Corporation or any Subsidiary, (b) any merger,
                    amalgamation, consolidation or change in the ownership of the Corporation or any Subsidiary, (c) any
                    issue of bonds, debentures, capital, preferred or prior preference stock ahead of or affecting the capital
                    stock (or the rights thereof) of the Corporation or any Subsidiary, (d) any dissolution or liquidation of the
                    Corporation or any Subsidiary, (e) any sale or transfer of all or any part of the assets or business of the
                    Corporation or any Subsidiary, or (f) any other corporate act or proceeding by the Corporation or any
                    Subsidiary.  No participant, beneficiary or any other person shall have any claim under any award or
                    award agreement against any member of the Board or the Administrator, or the Corporation or any
                    employees, officers or agents of the Corporation or any Subsidiary, as a result of any such action.

            8.13  Other Company Benefit and Compensation Programs.  Payments and other benefits received by a
                    participant under an award made pursuant to this Plan shall not be deemed a part of a participant's
                    compensation for purposes of the determination of benefits under any other employee welfare or benefit
                    plans or arrangements, if any, provided by the Corporation or any Subsidiary, except where the
                    Administrator expressly otherwise provides or authorizes in writing.  Awards under this Plan may be
                    made in addition to, in combination with, as alternatives to or in payment of grants, awards or
                    commitments under any other plans or arrangements of the Corporation or its Subsidiaries.

16

 

EX-10

EXHIBIT 10.41

MENTOR CORPORATION
2005 LONG-TERM INCENTIVE PLAN
RESTRICTED STOCK AWARD AGREEMENT

THIS RESTRICTED STOCK AWARD AGREEMENT (this "Award Agreement") is dated as of [____________, _____] (the "Award Date") by and between Mentor Corporation, a Minnesota corporation (the "Corporation"), and [______________] (the "Participant").

W I T N E S S E T H

WHEREAS, pursuant to the Mentor Corporation 2005 Long-Term Incentive Plan (the "Plan"), the Corporation hereby grants to the Participant, effective as of the date hereof, a restricted stock award (the "Award"), upon the terms and conditions set forth herein and in the Plan.

NOW THEREFORE, in consideration of services rendered and to be rendered by the Participant, and the mutual promises made herein and the mutual benefits to be derived therefrom, the parties agree as follows:

1.                   Defined Terms.  Capitalized terms used herein and not otherwise defined herein shall have the meaning assigned to such terms in the Plan.

2.                   Grant; Purchase Price.  Subject to the terms of this Award Agreement, the Corporation hereby grants to the Participant an Award with respect to an aggregate of [________] restricted shares of Common Stock of the Corporation (the "Restricted Stock") [at a purchase price of [______] per share (the "Purchase Price")].

3.                   Vesting.  Subject to Section 9 below, the Award shall vest, and restrictions (other than those set forth in Section 8.1 of the Plan) shall lapse, with respect to one-fifth of the total number of shares of Restricted Stock (subject to adjustment under Section 7.1 of the Plan) on each of the first, second, third, fourth and fifth anniversaries of the Award Date.

4.                   Continuance of Employment.  The vesting schedule requires continued employment or service through each applicable vesting date as a condition to the vesting of the applicable installment of the Award and the rights and benefits under this Award Agreement.  Partial employment or service, even if substantial, during any vesting period will not entitle the Participant to any proportionate vesting or avoid or mitigate a termination of rights and benefits upon or following a termination of employment or services as provided in Section 9 below or under the Plan.

Nothing contained in this Award Agreement or the Plan constitutes an employment or service commitment by the Corporation, affects the Participant's status, if the Participant is an employee, as an employee at will who is subject to termination without cause, confers upon the Participant any right to remain employed by or in service to the Corporation or any of its Subsidiaries, interferes in any way with the right of the Corporation or any of its Subsidiaries at any time to terminate such employment or services, or affects the right of the Corporation or any of its Subsidiaries to increase or decrease the Participant's other compensation or benefits.  Nothing in this paragraph, however, is intended to adversely affect any independent contractual right of the Participant without his or her consent thereto.

5.                   Dividend and Voting Rights.  After the Award Date, the Participant shall be entitled to cash dividends and voting rights with respect to the shares of Restricted Stock subject to the Award even though such shares are not vested, provided that such rights shall terminate immediately as to any shares of Restricted Stock that are forfeited pursuant to Section 9 below.

6.                   Restrictions on Transfer.

(a)                 Before Vesting.  Prior to the time that they have become vested pursuant to Section 3, neither the Restricted Stock, nor any interest therein, amount payable in respect thereof, or Restricted Property (as defined in Section 10 hereof) may be sold, assigned, transferred, pledged or otherwise disposed of, alienated or encumbered (collectively, a "Transfer"), either voluntarily or involuntarily.  The Transfer restrictions in the preceding sentence shall not apply to (i) transfers to the Corporation, or (ii) transfers by will or the laws of descent and distribution.

(b)                 After Vesting.  Upon and after the time that any shares of Restricted Stock have vested pursuant to Section 3, the Participant shall be permitted to Transfer (subject to applicable securities law requirements, the Corporation's insider trading policies, and other applicable laws and regulations) up to forty percent (40%) of such shares in the aggregate (taking into consideration the total number of shares of Restricted Stock that have vested pursuant to Section 3 and any past Transfers of any of such shares by the Participant).  The Administrator may, in its discretion, increase the foregoing percentage if the Participant demonstrates that such greater percentage is necessary to satisfy any income and employment taxes attributable to the vesting of such shares.  The Transfer limitation in the first sentence of this Section 6(b) shall not apply to (i) transfers to the Corporation, or (ii) transfers by will or the laws of descent and distribution.  The Transfer restriction in this Section 6(b) shall terminate on the earlier to occur of (x) the fifth anniversary of the Award Date (but the shares shall continue to be subject to the restrictions of Section 7), or (y) the Participant's Severance Date (as defined below).

7.                   Stock Ownership Guidelines.  By accepting the Award and executing this Award Agreement, the Participant agrees to be bound by the stock ownership requirements set forth in this Section 7.

(a)                 Ownership Threshold.  The Participant's "Ownership Threshold" shall be the number of shares of the Corporation's Common Stock obtained when (i) the product obtained by multiplying (A) the Participant's [annual retainer (in the case of Directors)] [or] [annualized base salary (in the case of CEO and other Corporation Officers)] in effect as of the Award Date, by (B) [three (3) (in the case of Directors and CEO)] [or] [two (2) (in the case of non-CEO Corporation Officers)], is divided by (ii) the Fair Market Value of a share of Common Stock on the Award Date.  The Ownership Threshold shall be subject to adjustment by the Administrator as provided in Section 10 hereof.  The Participant agrees to attain a level of Stock Ownership (as defined below) at least equal to the Ownership Threshold no later than the fifth anniversary of the Award Date and to maintain such level of Stock Ownership throughout the remainder of the Participant's employment or service with the Corporation and its Subsidiaries.

(b)                 Stock Ownership.  For purposes of this Section 7 and subject to the next sentence, the Participant's "Stock Ownership" shall consist of all actual shares of Common Stock actually or beneficially (within the meaning of Rule 13d-3 promulgated under the Exchange Act) owned by the Participant.  Notwithstanding the preceding sentence, none of the following shall constitute shares of Common Stock actually or beneficially owned by the Participant for this purpose: (i) any shares of restricted Common Stock, performance shares, or restricted Common Stock units (covered by this Award Agreement or a similar award) unless and until such shares or units are no longer subject to a substantial risk of forfeiture, (ii) any shares of Common Stock subject to an outstanding stock option or stock appreciation right (regardless of whether such award is vested and/or "in the money"), or (iii) any shares of Common Stock payable in respect of compensation earned but deferred prior to the time such shares are actually delivered.  For purposes of clarity, upon exercise of a stock option by the Participant, only the actual number of shares of Common Stock acquired upon such exercise and retained by the Participant shall count as Stock Ownership (i.e., any shares that are used to settle the exercise price of the option or any tax withholding requirements shall not be counted as part of the Participant's Stock Ownership).

(c)                 Waiver.  Notwithstanding the foregoing provisions, the Board may, in its sole discretion, take any action with respect to the provisions of this Section 7 that does not have a material adverse effect on the rights of the Participant, including without limitation effecting a reduction (but not an increase) in the Participant's Ownership Threshold and/or waiving any of the limitations set forth in this Section 7 if it determines that such action is appropriate under the circumstances.

2

8.                   Stock Certificates.

(a)                 Book Entry Form.  The Corporation shall issue the shares of Restricted Stock subject to the Award either: (i) in certificate form as provided in Section 8(b) below; or (ii) in book entry form, registered in the name of the Participant with notations regarding the applicable restrictions on transfer imposed under this Award Agreement.

(b)                 Certificates to be Held by Corporation; Legend.  Any certificates representing shares of Restricted Stock that may be delivered to the Participant by the Corporation prior to vesting shall be redelivered to the Corporation to be held by the Corporation until the restrictions on such shares shall have lapsed and the shares shall thereby have become vested or the shares represented thereby have been forfeited hereunder.  Such certificates shall bear the following legend:

"The ownership of this certificate and the shares of stock evidenced hereby and any interest therein are subject to substantial restrictions on transfer under an Agreement entered into between the registered owner and Mentor Corporation.  A copy of such Agreement is on file in the office of the Secretary of Mentor Corporation."

(c)                 Delivery of Certificates Upon Vesting.  Promptly after the vesting of any shares of Restricted Stock pursuant to Section 3, the Corporation shall, as applicable, either remove the notations on any shares of Restricted Stock issued in book entry form which have vested or deliver to the Participant a certificate or certificates evidencing the number of shares of Restricted Stock which have vested (or, in either case, such lesser number of shares as may be permitted pursuant to Section 8.5 of the Plan).  The Participant (or the beneficiary or personal representative of the Participant in the event of the Participant's death or disability, as the case may be) shall deliver to the Corporation any representations or other documents or assurances required pursuant to Section 8.1 of the Plan.  The shares so delivered shall no longer be restricted shares hereunder.

(d)                 Stock Power; Power of Attorney.  Concurrently with the execution and delivery of this Award Agreement, the Participant shall deliver to the Corporation an executed stock power in the form attached hereto as Exhibit A, in blank, with respect to such shares.  The Participant, by acceptance of the Award, shall be deemed to appoint, and does so appoint by execution of this Award Agreement, the Corporation and each of its authorized representatives as the Participant's attorney(s)‑in‑fact to effect any transfer of unvested forfeited shares (or shares otherwise reacquired by the Corporation hereunder) to the Corporation as may be required pursuant to the Plan or this Award Agreement and to execute such documents as the Corporation or such representatives deem necessary or advisable in connection with any such transfer.

9.                   Effect of Termination of Employment or Services. 

(a)                 General.  Subject to earlier vesting as provided in Section 7 of the Plan and Section 9(b) hereof, if the Participant ceases to be employed by or ceases to provide services to the Corporation or a Subsidiary, the Participant's shares of Restricted Stock (and related Restricted Property as defined in Section 10 hereof) shall be forfeited to the Corporation to the extent such shares have not become vested pursuant to Section 3 upon the date the Participant's employment or services terminate (the "Severance Date"), regardless of the reason for such termination (whether with or without cause, voluntarily or involuntarily, or due to death or disability).  Upon the occurrence of any forfeiture of shares of Restricted Stock hereunder, such unvested, forfeited shares and related Restricted Property shall be automatically transferred to the Corporation, without any other action by the Participant (or the Participant's beneficiary or personal representative in the event of the Participant's death or disability, as applicable) and the Corporation shall refund the Purchase Price (if any) for such forfeited shares to the Participant (or the Participant's beneficiary or personal representative in the event of the Participant's death or disability, as applicable).  No additional consideration shall be paid by the Corporation with respect to such transfer.  No interest shall be credited with respect to nor shall any other adjustments be made to the Purchase Price for fluctuations in the fair market value of the Common Stock either before or after the transfer date (except for customary adjustments to reflect stock splits, reverse stock splits, and stock dividends).  The Corporation may exercise its powers under Section 8(d) hereof and take any other action necessary or advisable to evidence such transfer.  The Participant (or the Participant's beneficiary or personal representative in the event of the Participant's death or disability, as applicable) shall deliver any additional documents of transfer that the Corporation may request to confirm the transfer of such unvested, forfeited shares and related Restricted Property to the Corporation.

3

(b)                 Acceleration on Certain Terminations.  Notwithstanding any other provision of this Award Agreement or of the Plan, (i) if a Change in Control Event (which, for purposes of this Agreement, shall have the meaning set forth below and not the one assigned to it in the Plan) occurs and the Award (to the extent outstanding and not otherwise vested at the time of the Change in Control Event) does not accelerate and become fully vested upon or in connection with such event as contemplated by Section 7.2 of the Plan (and is not otherwise accelerated by the Administrator as provided in Section 7.3 of the Plan), and (ii) if, within twelve (12) months following the date of the Change in Control Event, the Participant has a Severance Date as a result of a termination by the Corporation or a Subsidiary for any reason other than for Cause or as a result of resignation by the Participant for Good Reason (as each such term is defined below), the Award (to the extent outstanding and not otherwise vested immediately prior to such termination) shall automatically become fully vested as of the Severance Date; provided, however, that if the Participant is a member of the Board at the time of the Change in Control Event and ceases to be a member of the Board for any reason within twelve (12) months following the date of the Change in Control Event (and does not otherwise continue to be employed by or provide services to the Corporation or a Subsidiary), the Award (to the extent outstanding and not otherwise vested immediately prior to such cessation of service) shall automatically become fully vested as of the Severance Date.

(c)                 Definitions.  For purposes of this Section 9, the following definitions shall apply.

(i)                   "Cause" shall have the meaning ascribed to such term or a similar term in any employment or similar agreement between the Corporation (or a Subsidiary) and the Participant then in effect that defines such term with respect to the Participant's employment by the Corporation or a Subsidiary.  In the event that there is no such agreement then in effect (or that any such agreement includes no such definition), "Cause" means (1) personal or professional misconduct by the Participant (including, but not limited to, criminal activity or gross or willful neglect of duty); (2) breach of the Participant's fiduciary duty to the Corporation; (3) conduct which threatens public health or safety, or threatens to do immediate or substantial harm to the Corporation's business or reputation; or (4) any other misconduct, deficiency, failure of performance, breach or default, reasonably capable of being remedied or corrected by the Participant.

(ii)                 "Change in Control Event" means any of the following:

            (a)            the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a "Person")) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 50% of either (1) the then-outstanding shares of common stock of the Corporation (the "Outstanding Company Common Stock") or (2) the combined voting power of the then-outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities"); provided, however, that, for purposes of this clause (a), the following acquisitions shall not constitute a Change in Control Event; (A) any acquisition directly from the Corporation, (B) any acquisition by the Corporation, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any affiliate of the Corporation or a successor, or (D) any acquisition by any entity pursuant to a transaction that complies with Sections (c)(1), (2) and (3) below;

            (b)            individuals who, as of the Award Date, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Award Date whose election, or nomination for election by the Corporation's shareholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board (including for these purposes, the new members whose election or nomination was so approved, without counting the member and his predecessor twice) shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;

4

            (c)            consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving the Corporation or any of its Subsidiaries, a sale or other disposition of all or substantially all of the assets of the Corporation, or the acquisition of assets or stock of another entity by the Corporation or any of its Subsidiaries (each, a "Business Combination"), in each case unless, following such Business Combination, (1) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Corporation or all or substantially all of the Corporation's assets directly or through one or more subsidiaries (a "Parent")) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, and (2) at least a majority of the members of the board of directors or trustees of the entity resulting from such Business Combination or a Parent were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or

            (d)            approval by the shareholders of the Corporation of a complete liquidation or dissolution of the Corporation other than in the context of a transaction that does not constitute a Change in Control Event under clause (c) above.

(iii)                "Good Reason" shall have the meaning ascribed to such term or a similar term in any employment or similar agreement between the Corporation (or a Subsidiary) and the Participant then in effect that defines such term with respect to the Participant's employment by the Corporation or a Subsidiary.  In the event that there is no such agreement then in effect (or that any such agreement includes no such definition), "Good Reason" means the occurrence of any of the following without the Participant's express written consent: (1) if the Participant is a party to an employment or similar agreement with the Corporation then in effect, a significant reduction of the Participant's material duties, position or responsibilities, or the removal of the Participant from such duties, position or responsibilities, as specified in such agreement; (2) a reduction in the Participant's base salary or cash incentive bonus other than a one-time reduction of not more than ten percent (10%) that is also applied to substantially all senior executives of the Corporation; (3) a material reduction in the Participant's benefits as compared to the benefits in effect on the Award Date; (4) a requirement by the Corporation that the Participant perform a significant portion of his or her duties at a location other than the headquarters of the Corporation; or (5) a relocation of the Corporation's headquarters more than fifty (50) miles from the current location in Santa Barbara, California.

10.               Adjustments Upon Specified Events.  Upon the occurrence of certain events relating to the Corporation's stock contemplated by Section 7.1 of the Plan, the Administrator shall make adjustments if appropriate in the number and kind of securities that may become vested under the Award and in the Participant's Ownership Threshold.  If any adjustment shall be made under Section 7.1 of the Plan or an event described in Section 7.3 of the Plan shall occur and the shares of Restricted Stock are not fully vested upon such event or prior thereto, the restrictions applicable to such shares of Restricted Stock shall continue in effect with respect to any consideration or other securities (the "Restricted Property" and, for the purposes of this Award Agreement, "Restricted Stock" shall include "Restricted Property", unless the context otherwise requires) received in respect of such Restricted Stock.  Such Restricted Property shall vest at such times and in such proportion as the shares of Restricted Stock to which the Restricted Property is attributable vest, or would have vested pursuant to the terms hereof if such shares of Restricted Stock had remained outstanding.  To the extent that the Restricted Property includes any cash (other than regular cash dividends provided for in Section 5 hereof), such cash shall be invested, pursuant to policies established by the Administrator, in interest bearing, FDIC-insured (subject to applicable insurance limits) deposits of a depository institution selected by the Administrator, the earnings on which shall be added to and become a part of the Restricted Property.

5

11.               Tax Withholding.  The Corporation (or any of its Subsidiaries last employing the Participant) shall be entitled to require a cash payment by or on behalf of the Participant and/or to deduct from other compensation payable to the Participant any sums required by federal, state or local tax law to be withheld with respect to the vesting of any Restricted Stock.  Alternatively, the Participant or other person in whom the Restricted Stock vests may irrevocably elect, in such manner and at such time or times prior to any applicable tax date as may be permitted or required under Section 8.5 of the Plan and rules established by the Administrator, to have the Corporation  withhold and reacquire shares of Restricted Stock at their fair market value at the time of vesting to satisfy any withholding obligations of the Corporation or its Subsidiaries with respect to such vesting.  Any election to have shares so held back and reacquired shall be subject to such rules and procedures, which may include prior approval of the Administrator, as the Administrator may impose, and shall not be available if the Participant makes or has made an election pursuant to Section 83(b) of the Code with respect to such Award.

12.               Notices.  Any notice to be given under the terms of this Award Agreement shall be in writing and addressed to the Corporation at its principal office to the attention of the Secretary, and to the Participant at the Participant's last address reflected on the Corporation's payroll records.  Any notice shall be delivered in person or shall be enclosed in a properly sealed envelope, addressed as aforesaid, registered or certified, and deposited (postage and registry or certification fee prepaid) in a post office or branch post office regularly maintained by the United States Government.  Any such notice shall be given only when received, but if the Participant is no longer an Eligible Person, shall be deemed to have been duly given five business days after the date mailed in accordance with the foregoing provisions of this Section 12.

13.               Plan.  The Award and all rights of the Participant under this Award Agreement are subject to the terms and conditions of the provisions of the Plan, incorporated herein by reference.  The Participant agrees to be bound by the terms of the Plan and this Award Agreement.  The Participant acknowledges having read and understanding the Plan, the Prospectus for the Plan, and this Award Agreement.  Unless otherwise expressly provided in other sections of this Award Agreement, provisions of the Plan that confer discretionary authority on the Board or the Administrator do not (and shall not be deemed to) create any rights in the Participant unless such rights are expressly set forth herein or are otherwise in the sole discretion of the Board or the Administrator so conferred by appropriate action of the Board or the Administrator under the Plan after the date hereof.

14.               Entire Agreement.  This Award Agreement and the Plan together constitute the entire agreement and supersede all prior understandings and agreements, written or oral, of the parties hereto with respect to the subject matter hereof.  The Plan and this Award Agreement may be amended pursuant to Section 8.6 of the Plan.  Such amendment must be in writing and signed by the Corporation.  The Corporation may, however, unilaterally waive any provision hereof in writing to the extent such waiver does not adversely affect the interests of the Participant hereunder, but no such waiver shall operate as or be construed to be a subsequent waiver of the same provision or a waiver of any other provision hereof.

15.               Counterparts.  This Award Agreement may be executed simultaneously in any number of counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. 

16.               Section Headings.  The section headings of this Award Agreement are for convenience of reference only and shall not be deemed to alter or affect any provision hereof.

17.               Governing Law.  This Award Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Minnesota without regard to conflict of law principles thereunder.

6

[Remainder of Page Intentionally Left Blank]

7

            IN WITNESS WHEREOF, the Corporation has caused this Award Agreement to be executed on its behalf by a duly authorized officer and the Participant has hereunto set his or her hand as of the date and year first above written.

MENTOR CORPORATION,

a Minnesota corporation

By:                                                                        

Print Name:                                                            

Its:                                                                         

PARTICIPANT

Signature

Print Name

8

CONSENT OF SPOUSE

In consideration of the execution of the foregoing Restricted Stock Award Agreement by Mentor Corporation, I, _____________________________, the spouse of the Participant therein named, do hereby join with my spouse in executing the foregoing Restricted Stock Award Agreement and do hereby agree to be bound by all of the terms and provisions thereof and of the Plan.

Dated:   _____________, 2005

Signature of Spouse

Print Name

9

EXHIBIT A

STOCK POWER

FOR VALUE RECEIVED and pursuant to that certain Restricted Stock Award Agreement between Mentor Corporation, a Minnesota corporation (the "Corporation"), and the individual named below (the "Individual") dated as of _____________, 2005, the Individual, hereby sells, assigns and transfers to the Corporation, an aggregate ________ shares of Common Stock of the Corporation, standing in the Individual's name on the books of the Corporation and represented by stock certificate number(s) _____________________________________________ to which this instrument is attached, and hereby irrevocably constitutes and appoints _________________ ____________________________________ as his or her attorney in fact and agent to transfer such shares on the books of the Corporation, with full power of substitution in the premises.

Dated _____________, ________

Signature

Print Name

(Instruction: Please do not fill in any blanks other than the signature line.  The purpose of the assignment is to enable the Corporation to exercise its sale/purchase option set forth in the Restricted Stock Award Agreement without requiring additional signatures on the part of the Individual.)

A-1

EX-21

EXHIBIT 21

LIST OF SUBSIDIARIES OF MENTOR CORPORATION
 

Subsidiary	State of Incorporation or Organization
Biopolymers (Scotland) Limited	Scotland
Byron Medical, Inc.	Arizona
Inform Solutions Inc.	California
MDI Company Ltd.	Bermuda
Mentor Aesthetics B.V.	Netherlands
Mentor Benelux B.V.	Netherlands
Mentor Biologics, Inc.	Wisconsin
Mentor Biopolymers Limited	United Kingdom
Mentor Deutschland GmbH	Germany
Mentor International Holdings Alpha, Inc.	Delaware
Mentor International Holdings Beta, Inc.	Delaware
Mentor International Holdings Camda, Inc.	Delaware
Mentor International Holdings Delta, Inc.	Delaware
Mentor Medical Inc.	Delaware
Mentor Medical Italia, S.r.l.	Italy
Mentor Medical Systems (Canada), Inc.	Canada
Mentor Medical Systems B.V.	Netherlands
Mentor Medical Systems Ltd. (U.K.)	England
Mentor Medical Systems Pty. Ltd.	Australia
Mentor Medical Systems, C.V.	Netherlands
Mentor Medical Systems, France, S.A.	France
Mentor Medical Systems, Iberica, S.L.	Spain
Mentor Minnesota Inc. (Formerly Mentor Urology, Inc.)	Delaware
Mentor Texas GP, LLC	Delaware
Mentor Texas LP (Formerly Mentor H/S, Inc).	Delaware
Mentor Biopharmaceuticals, Inc. (Formerly Mills Biopharmaceuticals, Inc.)	Oklahoma
Melene Corporation (Formerly Selene Corporation)	California

EX-23

EXHIBIT 23

CONSENT OF ERNST & YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 

We consent to the incorporation by reference in the Registration Statement Number 33-25865 on Form S-8 dated December 22, 1988, the Registration Statement Number 33-48815 on Form S-8 dated June 24, 1992, the Registration Statement Number 333-73306 on Form S-8 dated November 14, 2001, the Registration Statement Number 333-100841 on Form S-8 dated October 30, 2002 and the Registration Statement Number 333-129160 on Form S-8 dated October 20, 2005, of our reports with respect to the consolidated financial statements and schedule of Mentor Corporation, Mentor Corporation management's assessment of the effectiveness of internal control over financial reporting, and the effectiveness of internal control over financial reporting of Mentor Corporation, included in this Annual Report (Form 10-K) for the year ended March 31, 2006.

/s/ERNST & YOUNG LLP

Los Angeles, California
June 12, 2006

EX-31

EXHIBIT 31.2

§302 CERTIFICATION

I, Loren L. McFarland, certify that:

1.    I have reviewed this annual report on Form 10-K of Mentor Corporation;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.    The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.  

Date:  June 14, 2006	/s/LOREN L. MCFARLAND
	Loren L. McFarland Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)

 

EX-32

EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Joshua H. Levine, President and Chief Executive Officer of Mentor Corporation (the "Company"), do hereby certify in accordance with 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1)        the accompanying Annual Report on Form 10-K of the Company for the year ended March 31, 2006 (the "Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934; as amended; and

(2)        information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 Dated: June 14, 2006

/s/JOSHUA H. LEVINE
Joshua H. Levine
President and Chief Executive Officer

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 ("Section 906"), or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Mentor Corporation and will be retained by Mentor Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32

EXHIBIT 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Loren L. McFarland, Vice President, Chief Financial Officer and Treasurer of Mentor Corporation (the "Company"), do hereby certify in accordance with 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1)        the accompanying Annual Report on Form 10-K of the Company for the year ended March 31, 2006 (the "Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934; as amended; and

(2)        information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 Dated: June 14, 2006

/s/LOREN L. MCFARLAND
Loren L. McFarland
Vice President, Chief Financial Officer and Treasurer

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 ("Section 906"), or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Mentor Corporation and will be retained by Mentor Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

EX-31

EXHIBIT 31.1

§302 CERTIFICATION

I, Joshua H. Levine, certify that:

1.    I have reviewed this annual report on Form 10-K of Mentor Corporation;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.    The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  June 14, 2006	/s/JOSHUA H. LEVINE
	Joshua H. Levine  President and Chief Executive Officer (Principal Executive Officer)