Exhibit 2
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SEPARATION AND DISTRIBUTION AGREEMENT
BY AND BETWEEN
XXXXXX LABORATORIES
AND
HOSPIRA, INC.
DATED AS OF _______, 2004
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THIS SEPARATION AND DISTRIBUTION AGREEMENT, dated as of _______, 2004, is
by and between XXXXXX LABORATORIES, an Illinois corporation ("ABBOTT") and
HOSPIRA, INC., a Delaware corporation ("HOSPIRA").
R E C I T A L S:
WHEREAS, the board of directors of Abbott has determined that it is
appropriate and advisable to: (i) separate the Hospira Business (as defined
herein) from the Abbott Business (as defined herein) (the "SEPARATION"); and
(ii) following the Separation, make a distribution, on a pro rata basis, to
holders of common shares, without par value, of Abbott (the "ABBOTT COMMON
SHARES") of all of the outstanding shares of common stock, par value $0.01 per
share, of Hospira (together with the associated preferred stock purchase rights,
the "HOSPIRA COMMON STOCK"), owned by Abbott (the "DISTRIBUTION"); and
WHEREAS, each of Abbott and Hospira has determined that it is necessary and
advisable to set forth the principal transactions required to effect the
Separation and the Distribution and to describe other agreements that will
govern certain other matters prior to and following the Separation and the
Distribution.
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained in this Agreement (as defined herein), the Parties (as
defined herein) hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. DEFINITIONS. Reference is made to SECTION 9.14 regarding
the interpretation of certain words and phrases used in this Agreement. In
addition, for the purpose of this Agreement, the following terms shall have the
meanings set forth below.
"ABBOTT" has the meaning set forth in the Preamble.
"ABBOTT BUSINESS" means all businesses and operations (whether or not such
businesses or operations are or have been terminated, divested or discontinued)
conducted prior to the Effective Time by Abbott, the Abbott Subsidiaries,
Hospira and the Hospira Subsidiaries, in each case that are not included in the
Hospira Business. For purposes of this Agreement and the Ancillary Agreements
only, the Abbott Business shall also be deemed to include the businesses and
operations (whether or not such businesses or operations are or have been
terminated, divested or discontinued) conducted prior to the Effective Time by
TAP Pharmaceutical Products Inc., TAP Finance Inc. and TAP Pharmaceuticals Inc.
"ABBOTT COMMON SHARES" has the meaning set forth in the Recitals.
"ABBOTT ENTRY POINT COMPANIES" means Abbott, Xxxxxx Laboratories
International Co., an Illinois corporation and Abbott Subsidiary, AIL and Tobal
Products Incorporated, an Illinois corporation and Abbott Subsidiary.
"ABBOTT INDEMNITEES" means: (i) Abbott and each Abbott Subsidiary; (ii)
each of the respective past, present and future directors, officers, employees
or agents of the entities described in (i) above, in each case in their
respective capacities as such; and (iii) each of the heirs, executors,
successors and assigns of any of the foregoing.
"ABBOTT INDEMNITY OBLIGATIONS" means all Liabilities (other than Hospira
Liabilities) to the extent such Liabilities relate to, arise out of or result
from any of the following items:
(i) any failure of Abbott or any Abbott Subsidiary to pay, perform or
otherwise promptly discharge any Abbott Liabilities in accordance with
their terms;
(ii) any breach by Abbott or any Abbott Subsidiary of this Agreement
or any of the Ancillary Agreements; and
(iii) any untrue statement or alleged untrue statement of a material
fact made explicitly in Xxxxxx'x name in the Registration Statement or the
Information Statement as the same may be amended prior to the Effective
Time, or any omission or alleged omission to state a material fact
necessary to make any such statement made explicitly in Xxxxxx'x name not
misleading.
"ABBOTT LIABILITIES" means the Liabilities relating to, arising out of or
resulting from actions, inactions, events, omissions, conditions, facts or
circumstances occurring or existing prior to the Effective Time (whether or not
such Liabilities cease being contingent, mature, become known, are asserted or
foreseen, or accrue, in each case before, at or after the Effective Time) of
Abbott and the Abbott Subsidiaries and, prior to the Effective Time, Hospira and
the Hospira Subsidiaries, in each case that are not Hospira Liabilities or
Hospira Indemnity Obligations.
"ABBOTT MARKETING AFFILIATE" means the entities set forth on SCHEDULE
1.01(a).
"ABBOTT OTHER LIABILITIES" has the meaning set forth on SCHEDULE 1.01(n).
"ABBOTT SUBSIDIARY" means any Subsidiary of Abbott other than Hospira and
any Hospira Subsidiary.
"ACTUAL DEFERRED TAXES" means the Tax effect of the sum of all temporary
differences relating to Taxes and all other differences relating to the basis of
property or liabilities properly classified under GAAP as temporary items of
Hospira and its Subsidiaries, adjusted for the effect of Xxxxxx'x filing its
2003 and 2004 U.S. federal income Tax returns.
"ADR" has the meaning set forth in SECTION 7.01.
"ADJUSTMENT" has the meaning set forth in SECTION 2.15.
"AGENT" means EquiServe Trust Company, N.A., or such other trust company or
bank appointed by Abbott that shall act as distribution agent, transfer agent
and registrar for the Hospira Common Stock in connection with the Distribution.
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"AGREEMENT" means this Separation and Distribution Agreement and each of
the Schedules hereto.
"AIL" means Abbott International Ltd., a Delaware corporation and an Abbott
Subsidiary that will become a limited liability company in connection with the
Separation.
"ALI" means Xxxxxx Laboratories Inc., a Delaware corporation and an Abbott
Subsidiary.
"ANCILLARY AGREEMENTS" means all written agreements, instruments,
understandings, assignments or other arrangements (other than this Agreement)
entered into by the Parties or any of their respective Subsidiaries in
connection with the Separation, the Distribution and the other transactions
contemplated by this Agreement, including the following: (i) the Conveyance and
Assumption Instruments; (ii) the Employee Benefits Agreement; (iii) the
Information Technology Agreement; (iv) the Intellectual Property Assignment
Agreement; (v) the Intellectual Property License Agreements; (vi) the
International Commercial Operations Agreement; (vii) the Inventory Trademark
License Agreement; (viii) the Leases; (ix) the Manufacture and Supply
Agreements; (x) the Tax Sharing Agreement; (xi) the Transition Marketing and
Distribution Services Agreements; (xii) the Transition Services Agreements; and
(xiii) any other agreements which the Parties determine are necessary or
advisable in connection with the Separation, the Distribution and the other
transactions contemplated by this Agreement and the Ancillary Agreements.
"ASSET TRANSFER DATE" means _______, 2004 or such other date not later than
the Distribution Date as may be determined by Abbott.
"ASSETS" means assets, rights, claims and properties of all kinds, real and
personal, tangible, intangible and contingent, including rights and benefits
pursuant to any contract, license, permit, indenture, note, bond, mortgage,
agreement, concession, franchise, instrument, undertaking, commitment,
understanding or other arrangement and any rights or benefits pursuant to any
Proceeding.
"BUSINESS ENTITY" means any corporation, general or limited partnership,
trust, joint venture, unincorporated organization, limited liability entity or
other entity.
"BYLAWS" means the Amended and Restated Bylaws of Hospira, substantially in
the form of EXHIBIT A.
"CERTIFICATE OF INCORPORATION" means the Restated Certificate of
Incorporation of Hospira, substantially in the form of EXHIBIT B.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMISSION" means the Securities and Exchange Commission.
"CONSENTS" means any consents, waivers or approvals from, or notification
requirements to, any Third Parties.
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"CONVEYANCE AND ASSUMPTION INSTRUMENTS" means, collectively, such deeds,
bills of sale, Asset transfer agreements, endorsements, assignments, assumptions
(including Liability assumption agreements), leases, subleases, affidavits and
other instruments of sale, conveyance, contribution, distribution, lease,
transfer and assignment between Abbott or, where applicable, any Abbott
Subsidiary, on the one hand, and Hospira or, where applicable, any Hospira
Subsidiary or designee of Hospira, on the other hand, as may be necessary or
advisable under the laws of the relevant jurisdictions to effect the Separation.
"DELAYED EX-U.S. COMMERCIAL ASSETS" means: (i) the Hospira Assets (other
than Delayed Ex-U.S. Manufacturing Assets) that are held as of the Effective
Time by: (A) any Abbott Marketing Affiliate; or (B) any Abbott Subsidiary
organized under the laws of any jurisdiction outside the United States; and (ii)
the Hospira Assets that are held by Abbott or any Abbott Subsidiary of the type
described in subsection (v) of the definition of Hospira Assets.
"DELAYED EX-U.S. COMMERCIAL LIABILITIES" means: (i) the Hospira Liabilities
(other than Delayed Ex-U.S. Manufacturing Liabilities) of: (A) any Abbott
Marketing Affiliate; or (B) any Abbott Subsidiary organized under the laws of
any jurisdiction outside the United States, in each case that remain outstanding
as of the Effective Time; and (ii) the Hospira Liabilities of Abbott or any
Abbott Subsidiary of the type described in subsection (vi) of the definition of
Hospira Liabilities.
"DELAYED EX-U.S. MANUFACTURING ASSETS" means the Hospira Assets held by the
Ex-U.S. Manufacturing Subsidiaries that are used in manufacturing operations at
the Hospira Ex-U.S. Manufacturing Facilities, legal title to which is not
contributed, assigned, transferred, conveyed or delivered to Hospira or a
Hospira Subsidiary prior to the Effective Time because such action would require
a Consent which has not been obtained as of that date.
"DELAYED EX-U.S. MANUFACTURING LIABILITIES" means the Hospira Liabilities
of the Ex-U.S. Manufacturing Subsidiaries that are incurred in the manufacturing
operations at the Hospira Ex-U.S. Manufacturing Facilities and are not assigned
to and accepted and assumed by Hospira or a Hospira Subsidiary prior to the
Effective Time because such action would require a Consent which has not been
obtained as of that date.
"DELAYED TRANSFER ASSETS" means the Delayed U.S. Assets, the Delayed
Ex-U.S. Manufacturing Assets and the Delayed Ex-U.S. Commercial Assets.
"DELAYED TRANSFER LIABILITIES" means the Delayed U.S. Liabilities, the
Delayed Ex-U.S. Manufacturing Liabilities and the Delayed Ex-U.S. Commercial
Liabilities.
"DELAYED U.S. ASSETS" means the Hospira Assets held by Abbott or any Abbott
Subsidiary incorporated under U.S. state law, legal title to which is not
contributed, assigned, transferred, conveyed and delivered to Hospira or a
Hospira Subsidiary prior to the Effective Time because such action would require
a Consent which had not been obtained as of that date.
"DELAYED U.S. LIABILITIES" means the Hospira Liabilities of Abbott or any
Abbott Subsidiary incorporated under U.S. state law which are not assigned to
and accepted and assumed by Hospira or a Hospira Subsidiary prior to the
Effective Time because such action would require a Consent which has not been
obtained as of that date.
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"DELAYED U.S./EX-U.S. MANUFACTURING ASSETS" means Delayed U.S. Assets and
Delayed Ex-U.S. Manufacturing Assets.
"DELAYED U.S./EX-U.S. MANUFACTURING LIABILITIES" means Delayed U.S.
Liabilities and Delayed Ex-U.S. Manufacturing Liabilities.
"DISCONTINUED PRODUCTS" means the products (regardless of whether or not
such products were: (i) abandoned or discontinued in clinical study phase; or
(ii) ever marketed or sold to Third Parties) that were terminated, divested or
discontinued by Xxxxxx'x hospital products division or Xxxxxx'x international
division prior to the Effective Time; PROVIDED that such products are of a
nature or type that would have resulted in such products' being included as
Hospira Products if such products had not been terminated, divested or
discontinued prior to the Effective Time. By way of example, SCHEDULE 1.01(o)
sets forth whether or not certain products shall be Discontinued Products.
"DISTRIBUTION" has the meaning set forth in the Recitals.
"DISTRIBUTION DATE" means the date determined by the board of directors of
Abbott, in its sole discretion, for the consummation of the Distribution.
"EFFECTIVE TIME" means 11:59 p.m. Eastern Time on the Distribution Date.
"EMPLOYEE BENEFITS AGREEMENT" means the Employee Benefits Agreement entered
into prior to the Effective Time by and between Abbott and Hospira.
"EMPLOYMENT TAX" means withholding, payroll, social security, workers
compensation, unemployment, disability and any similar tax imposed by any Tax
Authority, and any interest, penalties, additions to tax or additional amounts
with respect to the foregoing imposed on any taxpayer or consolidated, combined
or unitary group of taxpayers.
"ENVIRONMENTAL LAW" means any supranational, international, national,
federal, state, or local statute, ordinance, rule, regulation, code, license,
permit, authorization, approval, Consent, common law (including tort and
environmental nuisance law), legal doctrine, order, judgment, decree,
injunction, requirement or agreement with any Governmental Authority, now or
hereafter in effect relating to employee health and safety, pollution or the
environment (including ambient air, surface water, groundwater, land surface or
subsurface strata or wildlife or other natural resources) or to emissions,
discharges, releases or threatened releases of any substance currently or at any
time hereafter listed, defined, designated or classified as hazardous, toxic,
waste, radioactive or dangerous, or otherwise regulated, under any of the
foregoing, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of any such substances,
including the Comprehensive Environmental Response, Compensation and Liability
Act, the Superfund Amendments and Reauthorization Act and the Resource
Conservation and Recovery Act and comparable provisions in any other applicable
law.
"ENVIRONMENTAL LIABILITIES" means all Liabilities relating to, arising out
of or resulting from any Environmental Law or contract or agreement relating to
employee health and safety, pollution or environmental matters (including
ambient air, surface water, groundwater, land
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surface or subsurface strata or wildlife or other natural resources) or to
emissions, discharges, releases or threatened releases of any substance
currently or at any time hereafter listed, defined, designated or classified as
hazardous, toxic, waste, radioactive or dangerous, or otherwise regulated under
any Environmental Law, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of any
such substances (including all removal, remediation or cleanup costs,
investigatory costs, governmental response costs, natural resources damages,
property damages, personal injury damages, costs of compliance with any product
take back requirements or with any settlement, judgment or other determination
of Liability and indemnity, contribution or similar obligations).
"ESTIMATED DEFERRED TAXES" means the Tax effect of the estimated sum of all
temporary differences relating to Taxes and all other differences relating to
the basis of property or liabilities properly classified under GAAP as temporary
items, as reflected on the pro forma balance sheet accounts of Hospira and its
Subsidiaries as of the Distribution Date as determined by the Parties within 60
days after the Distribution Date.
"EX-U.S. MANUFACTURING SUBSIDIARIES" means: (i) the following Abbott
Subsidiaries: Xxxxxx Laboratories Limited, a Canadian company; Abbott Hospitals
Limited, a Bahamas company; Abbott Ireland, a Bermuda company; Xxxxxx Ireland
Holdings Ltd., a Bermuda limited liability company; and Xxxxx-Xxxxxxx
Farmaceutici SpA, an Italian company; and (ii) the following Transferred
Entities: Xxxxxx Laboratories de Costa Rica Ltd., a Bahamas company; and Abbott
Hospital de Costa Rica Ltd., a Bahamas company.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
together with the rules and regulations promulgated thereunder.
"EXCLUDED ASSETS" means: (i) all Assets of the Parties or their respective
Subsidiaries to the extent such Assets relate to, arise out of or result from
the Abbott Business, it being understood that none of the Assets on SCHEDULE
1.01(k) shall be Excluded Assets; (ii) all cash and cash equivalents as of the
Effective Time of Abbott, each Abbott Subsidiary, Hospira and each Hospira
Subsidiary, except as set forth on SCHEDULE 1.01(d); (iii) all Assets that are
expressly contemplated by this Agreement or any Principal Ancillary Agreement to
be Assets retained by Abbott or any Abbott Subsidiary; (iv) all Assets of TAP
Pharmaceutical Products Inc., TAP Finance Inc. or TAP Pharmaceuticals Inc.; and
(v) all other Assets set forth on SCHEDULE 1.01(b).
"EXCLUDED LIABILITIES" means all of the following Liabilities of the
Parties or their respective Subsidiaries:
(i) all Liabilities to the extent such Liabilities relate to, arise
out of, or result from any Excluded Assets (it being understood that
Liabilities relating to, arising out of or resulting from Hospira Assets or
Hospira Products shall not be Excluded Liabilities);
(ii) all Abbott Other Liabilities;
(iii) all Liabilities that are expressly contemplated by this
Agreement or any Principal Ancillary Agreement to be Liabilities not
transferred to or assumed by Hospira or any Hospira Subsidiary; and
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(iv) all other Liabilities set forth on SCHEDULE 1.01(c).
"FINAL ADJUSTMENT" has the meaning set forth in SECTION 2.15.
"FINANCING AGREEMENTS" means the financing agreements to be entered into
prior to the Effective Time by and among Abbott, Hospira and an agent or
co-agents selected by Abbott and Hospira for a principal amount of approximately
Seven Hundred Million U.S. Dollars (US$700,000,000).
"GAAP" means U.S. generally accepted accounting principles as applied by
Abbott as of the Distribution Date.
"GOVERNMENTAL AUTHORITY" means any supranational, international, national,
federal, state, or local court, government, department, commission, board,
bureau, agency, official or other regulatory, administrative or governmental
authority, including the NYSE and any similar self-regulatory body under
applicable securities laws or regulations.
"HOSPIRA" has the meaning set forth in the Preamble.
"HOSPIRA ASSETS" means only the following Assets of the Parties or their
respective Subsidiaries, but excluding any Excluded Assets:
(i) the outstanding capital stock of the Transferred Entities;
(ii) the Assets included on the Hospira Pro Forma Balance Sheet or any
subledger thereto that are owned by either Party or any of their respective
Subsidiaries as of the Effective Time;
(iii) the Assets of either Party or any of their respective
Subsidiaries as of the Effective Time that are of a nature or type that
would have resulted in such Assets' being included as Assets on a pro forma
combined balance sheet of Hospira and the notes or subledgers thereto as of
the Effective Time (were such balance sheet, notes and subledgers to be
prepared) on a basis consistent with the determination of the Assets
included on the Hospira Pro Forma Balance Sheet or any subledger thereto;
(iv) the Assets expressly allocated to Hospira or any Hospira
Subsidiary under this Agreement or any of the Principal Ancillary
Agreements;
(v) the trade receivables, inventory, service equipment and other
Assets (including Assets expressly allocated to Hospira or any Hospira
Subsidiary under this Agreement or any Principal Ancillary Agreement) that
will be held during the International Transition Period on behalf of
Hospira by Abbott or any Abbott Subsidiary in connection with the
International Transition Period Business; PROVIDED such Assets are of a
nature or type that would have resulted in such Assets' being included as
Assets on a pro forma combined balance sheet of Hospira and the notes or
subledgers thereto as of the Effective Time (were such balance sheet, notes
or subledgers to be prepared) on a basis consistent with the determination
of the Assets included on the Hospira Pro Forma Balance Sheet or any
subledger thereto;
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(vi) the Hospira Products and the rights to Hospira Products;
(vii) the contract rights, licenses, trade secrets, know-how, clinical
study data, product registrations, any other rights or intellectual
property and any other rights, claims or properties, in each case: (A) as
of the Effective Time; (B) to the extent related to the Hospira Products or
the Hospira Business; and (C) that are of a nature or type that would not
typically appear on a balance sheet and the notes or any subledger thereto
and are not otherwise specifically addressed under any other subsection of
this definition; and
(viii) the Assets identified on SCHEDULE 1.01(d).
All Delayed Transfer Assets shall be Hospira Assets for purposes of this
Agreement and the Ancillary Agreements regardless of when legal title to such
Delayed Transfer Assets is transferred to Hospira or any Hospira Subsidiary or
designee.
"HOSPIRA BAHAMAS" means Hospira Limited, a Bahamas company and a Hospira
Subsidiary.
"HOSPIRA BUSINESS" means:
(i) the business and operations conducted prior to the Effective Time
by Abbott, the Abbott Subsidiaries, Hospira and the Hospira Subsidiaries to
the extent such business and operations relate to, arise out of or result
from the Hospira Products (including the marketing, distribution and sale
of such Hospira Products, but excluding the research, development and
manufacture of such Hospira Products for the purposes of this clause (i));
(ii) the business and operations conducted prior to the Effective Time
by Abbott, the Abbott Subsidiaries, Hospira and the Hospira Subsidiaries of
manufacturing: (A) Hospira Products; (B) other products manufactured as
part of the One 2 OneTM contract manufacturing business; and (C) products
that will be manufactured for Abbott or any Abbott Subsidiary by Hospira or
its Subsidiaries after the Effective Time pursuant to the Manufacture and
Supply Agreements, in each case as conducted at the manufacturing
facilities set forth on SCHEDULE 1.01(k);
(iii) the research and development projects undertaken by Xxxxxx'x
hospital products division prior to the Effective Time: (A) to the extent
related to Hospira Products; (B) to the extent related to the intellectual
property being transferred or assigned to Hospira pursuant to this
Agreement or any Principal Ancillary Agreement; or (C) described on
SCHEDULE 1.01(l); and
(iv) the business and operations conducted prior to the Effective Time
by Abbott, the Abbott Subsidiaries, Hospira and the Hospira Subsidiaries
with respect to the Discontinued Products, but only to the extent of and
expressly limited to the Assets and Liabilities described in Item 4 of
SCHEDULE 1.01(d) and Item 1 of SCHEDULE 1.01(f).
"HOSPIRA COMMON STOCK" has the meaning set forth in the Recitals.
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"HOSPIRA EX-U.S. MANUFACTURING FACILITIES" means the manufacturing
facilities operated prior to the Effective Time by Abbott, Abbott Subsidiaries,
Hospira or Hospira Subsidiaries at the following locations: Finisklin, Ireland;
La Aurora, Costa Rica; Liscate, Italy; Lurganbuoy, Donegal, Ireland; Xxxxxxxx,
Xxxxxx, Xxxxxx; and San Xxxxxxxxx, Dominican Republic.
"HOSPIRA INDEMNITEES" means: (i) Hospira and each Hospira Subsidiary; (ii)
each of the respective past, present and future directors, officers, employees
or agents of the entities described in (i) above, in each case in their
respective capacities as such; and (iii) each of the heirs, executors,
successors and assigns of any of the foregoing.
"HOSPIRA INDEMNITY OBLIGATIONS" means all Liabilities to the extent such
Liabilities relate to, arise out of or result from any of the following items:
(i) any failure of Hospira or any Hospira Subsidiary to pay, perform
or otherwise promptly discharge any Hospira Liabilities in accordance with
their terms;
(ii) any breach by Hospira or any Hospira Subsidiary of this Agreement
or any of the Ancillary Agreements; and
(iii) any untrue statement or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, with respect to all information contained in the Registration
Statement or the Information Statement (other than the matters described in
subparagraph (iii) of the definition of Abbott Indemnity Obligations).
"HOSPIRA LIABILITIES" means all of the following Liabilities of the Parties
or their respective Subsidiaries, but excluding any Excluded Liabilities:
(i) all Liabilities included on the Hospira Pro Forma Balance Sheet or
any subledger thereto that remain outstanding as of the Effective Time;
(ii) all other Liabilities that are incurred or accrued by either
Party or any of their respective Subsidiaries from the date of the Hospira
Pro Forma Balance Sheet to the Effective Time that are of a nature or type
that would have resulted in such Liabilities' being included as Liabilities
on a pro forma combined balance sheet of Hospira and the notes or
subledgers thereto as of the Effective Time (were such balance sheet, notes
or subledgers to be prepared) on a basis consistent with the determination
of the Liabilities included on the Hospira Pro Forma Balance Sheet or any
subledger thereto
(iii) all Liabilities expressly allocated to Hospira or any Hospira
Subsidiary pursuant to this Agreement or any Principal Ancillary Agreement;
(iv) all Liabilities to the extent relating to, arising out of or
resulting from actions, inactions, events, omissions, conditions, facts or
circumstances occurring or existing prior to the Effective Time (whether or
not such Liabilities cease being contingent, mature, become known, are
asserted or foreseen, or accrue, in each case before, at or after the
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Effective Time) in each case to the extent such Liabilities relate to,
arise out of or result from any Hospira Asset or the Hospira Business;
(v) all Liabilities relating to, arising out of or resulting from the
Financing Agreements;
(vi) all Liabilities (including Liabilities expressly allocated to
Hospira or any Hospira Subsidiary under this Agreement or any Principal
Ancillary Agreement) relating to, arising out of or resulting from any
actions, inactions, omissions, conditions, facts or circumstances occurring
or existing during the International Transition Period to the extent such
Liabilities relate to, arise out of or result from the International
Transition Period Business or a Hospira Asset used in the International
Transition Period Business (except any indemnity or payment obligations of
Abbott or any Abbott Subsidiary under any Transition Marketing and
Distribution Services Agreement or the International Commercial Operations
Agreement;
(vii) all Hospira Other Liabilities; and
(viii) all other Liabilities set forth on SCHEDULE 1.01(f).
All Delayed Transfer Liabilities shall be Hospira Liabilities for purposes of
this Agreement and the Ancillary Agreements regardless of when legal title to
such Delayed Transfer Liabilities is transferred to Hospira or any Hospira
Subsidiary or designee.
"HOSPIRA OTHER LIABILITIES" has the meaning set forth on SCHEDULE 1.01(n).
"HOSPIRA PRO FORMA BALANCE SHEET" means the pro forma combined balance
sheet of Hospira, including the notes thereto, as of December 31, 2003, as
presented in the Information Statement mailed to the Record Holders prior to the
Effective Time.
"HOSPIRA PROCEEDING LIABILITIES" means any Proceeding Liabilities that are
Hospira Liabilities.
"HOSPIRA PRODUCTS" means the products set forth on SCHEDULE 1.01(e).
"HOSPIRA SPA" means Hospira SpA, an Italian company and a Hospira
Subsidiary.
"HOSPIRA SUBSIDIARY" means any Subsidiary of Hospira. For greater clarity,
the Transferred Entities shall be deemed to have been Hospira Subsidiaries at
all times prior to the Effective Time.
"HWI" means Hospira Worldwide, Inc., a Delaware corporation and a Hospira
Subsidiary.
"INDEMNIFYING PARTY" has the meaning set forth in SECTION 4.04(a).
"INDEMNITEE" means any Hospira Indemnitee or any Abbott Indemnitee, as
appropriate.
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"INDEMNITY PAYMENT" has the meaning set forth in SECTION 4.04(a).
"INFORMATION" means information, whether or not patentable or
copyrightable, in written, oral, electronic or other tangible or intangible
forms, including studies, reports, records, books, contracts, instruments,
surveys, discoveries, ideas, concepts, know-how, techniques, designs,
specifications, drawings, blueprints, diagrams, models, prototypes, samples,
flow charts, data, computer data, disks, diskettes, tapes, computer programs or
other software, marketing plans, customer names, communications by or to
attorneys (including attorney-client privileged communications), memos and other
materials prepared by attorneys or under their direction (including attorney
work product), and other technical, financial, employee or business information
or data.
"INFORMATION STATEMENT" means the information statement forming a part of
the Registration Statement as the same may be amended or supplemented from time
to time.
"INFORMATION TECHNOLOGY AGREEMENT" means the Information Technology
Agreement entered into prior to the Effective Time by and between Abbott and
Hospira or their respective Subsidiaries.
"INSURANCE PROCEEDS" means, with respect to any insured party, those
monies, net of any applicable premium adjustments (including reserves and
retrospectively rated premium adjustments) and net of any costs or expenses
incurred in the collection thereof, which are either: (i) received by an insured
from an insurance carrier or its estate; or (ii) paid by an insurance carrier or
its estate on behalf of the insured.
"INTELLECTUAL PROPERTY ASSIGNMENT AGREEMENT" means the Intellectual
Property Assignment Agreement entered into prior to the Effective Time by and
between Abbott and Hospira.
"INTELLECTUAL PROPERTY LICENSE AGREEMENTS" means the Intellectual Property
License Agreements entered into prior to the Effective Time by and between
Abbott and Hospira and set forth on SCHEDULE 1.01(g).
"INTERNATIONAL COMMERCIAL OPERATIONS AGREEMENT" means the International
Commercial Operations Agreement entered into prior to the Effective Time by and
between Abbott and Hospira.
"INTERNATIONAL TRANSITION PERIOD" means the period from the Effective Time
to the Final Closing Date (as defined in the International Commercial Operations
Agreement).
"INTERNATIONAL TRANSITION PERIOD BUSINESS" means the business and
operations conducted during the International Transition Period to the extent
such business and operations relate to, arise out of or result from the
activities to be performed by Abbott, any Abbott Subsidiary, Hospira or any
Hospira Subsidiary pursuant to any Transition Marketing and Distribution
Services Agreement or the International Commercial Operations Agreement.
"INVENTORY TRADEMARK LICENSE AGREEMENT" means the Inventory Trademark
License Agreement entered into prior to the Effective Time by and between Abbott
and Hospira.
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"LEASES" means the real property leases entered into prior to the Effective
Time by and between Abbott and Hospira or their respective Subsidiaries and set
forth on SCHEDULE 1.01(h).
"LIABILITIES" means all debts, liabilities, obligations, responsibilities,
response actions, losses, damages (whether compensatory, punitive,
consequential, treble or other), fines, penalties and sanctions, absolute or
contingent, matured or unmatured, liquidated or unliquidated, foreseen or
unforeseen, joint, several or individual, asserted or unasserted, accrued or
unaccrued, known or unknown, whenever arising, including those arising under or
in connection with any law, statute, ordinance, regulation, rule or other
pronouncements of Governmental Authorities having the effect of law (including
any Environmental Law), Proceeding, threatened Proceeding, order or consent
decree of any Governmental Authority or any award of any arbitration tribunal,
and those arising under any contract, guarantee, commitment or undertaking,
whether sought to be imposed by a Governmental Authority, private party, or
Party, whether based in contract, tort, implied or express warranty, strict
liability, criminal or civil statute, or otherwise, and including any costs,
expenses, interest, attorneys' fees, disbursements and expense of counsel,
expert and consulting fees and costs related thereto or to the investigation or
defense thereof.
"LOCAL CLOSINGS" means the local closings contemplated by the Transition
Marketing and Distribution Services Agreements.
"MANUFACTURE AND SUPPLY AGREEMENTS" means the Manufacture and Supply
Agreements entered into prior to the Effective Time by and between Abbott and
Hospira and set forth in SCHEDULE 1.01(m).
"MIXED ACCOUNTS" has the meaning set forth in SECTION 2.11(b).
"MIXED CONTRACT" has the meaning set forth in SECTION 2.11(a).
"MONTH END RATE" means for any currency other than United States dollars,
the official average monthly rates used by Abbott for conversion of its monthly
financial statements, known as the average B.2.0 rate. The month end B.2.0 rate
is determined by taking the numbers from the 9:00 a.m. (Central Time) Reuters
screen at the second to last Xxxxxx Park, Illinois business day of each calendar
month (with the exception of November, when the rate is taken on the last such
business day). For the Euro, British Pound, Australian Dollar and New Zealand
Dollar, the bid rate is used. For all other currencies, the ask price is used.
An average monthly rate is determined by taking the simple average of the prior
month book rate and the current month book rate. If the exchange rates available
locally are not reflected on the Reuters screen, Abbott may choose to approve a
deviation allowing the country to report rates directly; PROVIDED such
deviations are signed and in place in accordance with the B.2.0 policy.
"NOTICE" has the meaning set forth in SECTION 4.05(a).
"NYSE" means The New York Stock Exchange, Inc.
"PARTIES" means the parties to this Agreement.
"PERSON" means any: (i) individual; (ii) Business Entity; or (iii)
Governmental Authority.
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"PRIME RATE" means the rate which Citibank N.A. (or its successor or
another major money center commercial bank agreed to by the Parties) announces
as its prime lending rate, as in effect from time to time.
"PRINCIPAL ANCILLARY AGREEMENTS" means: (i) the Employee Benefits
Agreement; (ii) the Information Technology Agreement; (iii) the Intellectual
Property Assignment Agreement; (iv) the Intellectual Property License
Agreements; (v) the International Commercial Operations Agreement; (vi) the
Inventory Trademark License Agreement; (vii) the Leases; (viii) the Manufacture
and Supply Agreements; (ix) the Tax Sharing Agreement; (x) the Transition
Marketing and Distribution Services Agreements; and (xi) the Transition Services
Agreements.
"PROCEEDING" means: (i) any past, present or future suit, countersuit,
action, arbitration, mediation, alternative dispute resolution process, claim,
counterclaim, demand, proceeding; (ii) any inquiry or investigation by or before
any Governmental Authority; or (iii) any arbitration or mediation tribunal, in
each case involving Abbott, any Abbott Subsidiary, any Abbott Indemnitee (but
only if in a capacity entitling such Person to the rights of an Abbott
Indemnitee), Hospira, any Hospira Subsidiary, or any Hospira Indemnitee (but
only if in a capacity entitling such Person to the rights of a Hospira
Indemnitee).
"PROCEEDING LIABILITIES" means all Abbott Liabilities and Hospira
Liabilities relating to, arising out of or resulting from any Proceeding,
including the Proceedings identified on SCHEDULE 1.01(i).
"RECORD DATE" means the close of business on the date to be determined by
the Abbott board of directors as the record date for determining holders of
Abbott Common Shares entitled to participate in the Distribution.
"RECORD HOLDERS" means the holders of record of Abbott Common Shares as of
the close of business on the Record Date.
"REGISTRATION STATEMENT" means the registration statement on Form 10 filed
under the Exchange Act on December 22, 2003, pursuant to which the Hospira
Common Stock to be distributed in the Distribution has been registered, together
with all amendments and supplements thereto.
"RIGHTS PLAN" means the Rights Agreement to be entered into between Hospira
and EquiServe Trust Company, N.A., as rights agent, substantially in the form of
EXHIBIT C.
"SECURITIES ACT" means the Securities Act of 1933, as amended, together
with the rules and regulations promulgated thereunder.
"SECURITY INTEREST" means any mortgage, security interest, pledge, lien,
charge, claim, option, right to acquire, voting or other restriction,
right-of-way, covenant, condition, easement, encroachment, restriction on
transfer, or other encumbrance of any nature whatsoever.
"SEPARATION" has the meaning set forth in the Recitals.
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"SUBSIDIARY" of any Party means another Business Entity that is directly or
indirectly controlled by such Party. As used herein, "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Business Entity, whether
through ownership of voting securities or other interests, by contract or
otherwise. For the avoidance of doubt, TAP Pharmaceutical Products Inc., TAP
Finance Inc. and TAP Pharmaceuticals Inc. are not Subsidiaries of Abbott as that
term is used in this Agreement.
"TAX" means: (i) any income, net income, gross income, gross receipts,
profits, capital stock, franchise, property, ad valorem, stamp, excise,
severance, occupation, service, sales, use, license, lease, transfer, import,
export, customs duties, value added, alternative minimum, estimated or other
similar tax (including any fee, assessment, or other charge in the nature of or
in lieu of any tax) imposed by any Tax Authority, and any interest, penalties,
additions to tax or additional amounts with respect to the foregoing imposed on
any taxpayer or consolidated, combined or unitary group of taxpayers; and (ii)
any Employment Tax.
"TAX AUTHORITY" means, with respect to any Tax, the governmental entity or
political subdivision thereof that imposes such Tax, and the agency (if any)
charged with the collection of such Tax for such entity or subdivision.
"TAX SHARING AGREEMENT" means the Tax Sharing Agreement entered into prior
to the Effective Time by and between Abbott and Hospira.
"THIRD PARTY" means any Person other than Abbott, any Abbott Subsidiary,
Hospira and any Hospira Subsidiary.
"THIRD PARTY CLAIM" has the meaning set forth in SECTION 4.05(a).
"TRANSFERRED ENTITIES" means the entities set forth on SCHEDULE 1.01(j).
"TRANSITION MARKETING AND DISTRIBUTION SERVICES AGREEMENTS" means the
Transition Marketing and Distribution Services Agreements entered into prior to
the Effective Time by and between Hospira or any Hospira Subsidiary and each
Abbott Marketing Affiliate.
"TRANSITION SERVICES AGREEMENTS" means the U.S. Transition Services
Agreement and the Ex-U.S. Transition Services Agreement entered into prior to
the Effective Time by and between Abbott and Hospira or their respective
Subsidiaries.
"U.S." or "UNITED STATES" means the United States of America, including
each of the 50 states thereof, the District of Columbia and Puerto Rico, but
excluding all other territories and possessions.
ARTICLE II
THE SEPARATION
SECTION 2.01. FORMATION OF HOSPIRA.
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(a) INCORPORATION OF HOSPIRA. The Parties acknowledge that: (i) Abbott
caused Hospira to be incorporated in Delaware on September 16, 2003 under the
name ABC 2003 Newco, Inc.; (ii) as of December 12, 2003, ABC 2003 Newco, Inc.
changed its name to Hospira, Inc.; and (iii) immediately prior to the Effective
Time, Abbott will be the sole stockholder of Hospira.
(b) ADOPTION OF HOSPIRA'S CHARTER AND BYLAWS. On or prior to the
Distribution Date, Abbott and Hospira shall take all necessary actions so that,
as of the Effective Time, the Certificate of Incorporation and the Bylaws shall
be the certificate of incorporation and bylaws of Hospira.
(c) ADOPTION OF HOSPIRA'S RIGHTS PLAN. On or prior to the Distribution
Date, Abbott and Hospira shall take all necessary actions so that, as of the
Effective Time, the Rights Plan shall be adopted by Hospira.
(d) HOSPIRA'S DIRECTORS AND OFFICERS. On or prior to the Distribution
Date, Abbott and Hospira shall take all necessary actions so that as of the
Effective Time: (i) the directors and executive officers of Hospira shall be
those set forth in the Information Statement mailed to the Record Holders prior
to the Effective Time, unless otherwise agreed by the Parties; and (ii) Hospira
shall have such other officers as Hospira shall desire.
(e) NYSE LISTING. Hospira shall prepare and file, and shall use
commercially reasonable efforts to have approved prior to the Effective Time, an
application for the listing on the NYSE of the Hospira Common Stock to be
distributed in the Distribution and shares of Hospira Common Stock to be
reserved for issuance pursuant to any director or employee benefit plan or
arrangement, subject to official notice of distribution.
SECTION 2.02. THE SEPARATION TRANSACTIONS. The Parties acknowledge
that the Separation is intended to result in Hospira's directly or indirectly
operating the Hospira Business, owning the Hospira Assets and assuming the
Hospira Liabilities as set forth below in this ARTICLE II.
(a) SEPARATION OF EX-U.S. MANUFACTURING OPERATIONS. Abbott and Hospira
shall, and shall cause each of their respective Subsidiaries to, take all
necessary actions to cause, effect and consummate the transactions set forth in
SCHEDULE 2.02(a) on the dates specified therein or on such other dates prior to
the Effective Time as may be determined by Abbott in order to transfer the
Hospira Ex-U.S. Manufacturing Facilities to the Hospira Subsidiaries.
(b) CONTRIBUTION OF CERTAIN ALI ASSETS AND LIABILITIES TO HWI. On the
Asset Transfer Date, Abbott shall cause ALI to contribute, assign, transfer,
convey and deliver to HWI, and Abbott shall cause HWI to accept from ALI, all of
ALI's rights, title and interest in and to all Hospira Assets owned by ALI
(other than Delayed Transfer Assets and outstanding shares of capital stock of
HWI), and Abbott shall cause HWI to accept, assume and agree faithfully to
perform, discharge and fulfill all of the Hospira Liabilities (other than
Delayed Transfer Liabilities) of ALI, in accordance with their respective terms.
(c) DISTRIBUTION OF HWI SHARES BY ALI TO ABBOTT. On the Asset Transfer
Date and with effect as of immediately after the transactions described in
subsection (b) above, Abbott
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shall cause ALI to distribute as a dividend to Abbott all of the outstanding
shares of capital stock of HWI and all of the membership interests in Hospira
Fleet Services, LLC.
(d) AIL'S CONVERSION TO AN LLC AND DISTRIBUTION OF CERTAIN ASSETS AND
LIABILITIES. Prior to the Asset Transfer Date, Abbott shall cause AIL to convert
to a limited liability company under section 266 of the Delaware General
Corporation Law. On the Asset Transfer Date:
(i) Abbott shall cause AIL to distribute all of the Hospira Assets
owned by AIL, other than the Delayed Transfer Assets, to Abbott as AIL's
sole member; and
(ii) Abbott shall accept and assume all of the Hospira Liabilities of
AIL, other than the Delayed Transfer Liabilities, in accordance with their
respective terms.
(e) CONTRIBUTION OF HOSPIRA ASSETS AND LIABILITIES. On the Asset
Transfer Date, and with effect as of immediately after the transactions
described in subsections (b), (c) and (d)(i) and (ii) above:
(i) Abbott shall contribute, assign, transfer, convey and deliver to
Hospira, and Hospira shall accept from Abbott, all of Xxxxxx'x rights,
title and interest in and to all of the Hospira Assets, including all of
the outstanding shares of capital stock or other ownership interests in
HWI, Hospira Bahamas, Hospira Puerto Rico, LLC, Hospira SpA, Oximetrix,
Inc., Xxxxxxxx Research Co., Inc. and Hospira Fleet Services, LLC, but
excluding any Delayed Transfer Assets, which will result in Hospira owning
directly or indirectly all of the Transferred Entities; and
(ii) Hospira shall accept, assume and agree faithfully to perform,
discharge and fulfill all of the Hospira Liabilities (other than Delayed
Transfer Liabilities) in accordance with their respective terms.
SECTION 2.03. DELAYED U.S./EX-U.S. MANUFACTURING ASSETS AND
LIABILITIES.
(a) ADMINISTRATION OF THE ASSETS AND LIABILITIES. Except as otherwise
provided herein or in any Principal Ancillary Agreement, from and after the
Effective Time, Abbott shall, and shall cause the Abbott Subsidiaries to, hold
on behalf of and for the benefit of Hospira all Delayed U.S./Ex-U.S.
Manufacturing Assets, and to pay, perform and discharge fully all Delayed
U.S./Ex-U.S. Manufacturing Liabilities. Hospira and the Hospira Subsidiaries
shall promptly reimburse Abbott or its designated Subsidiaries for all payments
made in connection with the performance and discharge of such Delayed
U.S./Ex-U.S. Manufacturing Liabilities. Each such Delayed U.S./Ex-U.S.
Manufacturing Asset or Delayed U.S./Ex-U.S. Manufacturing Liability shall be
held by Abbott or, where applicable, an Abbott Subsidiary for, insofar as
reasonably practical, the benefit and detriment of Hospira or a designated
Hospira Subsidiary. Abbott and Hospira shall, and shall cause their respective
Subsidiaries to, take such other actions as may be reasonably requested by the
other in accordance with the provisions of this Agreement in order to place
Abbott and Hospira, insofar as reasonably practical, in the same position as if
such Delayed U.S./Ex-U.S. Manufacturing Asset or Delayed U.S./Ex-U.S.
Manufacturing Liability had been fully contributed, assigned, transferred,
conveyed, and delivered to, and accepted and assumed by, Hospira as of the
Effective Time so that all the benefits and burdens
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relating to such Delayed U.S./Ex-U.S. Manufacturing Asset and Delayed
U.S./Ex-U.S. Manufacturing Liability, including risk of loss, potential for
gain, and control of such Delayed U.S./Ex-U.S. Manufacturing Asset and Delayed
U.S./Ex-U.S. Manufacturing Liability, shall inure from and after the Effective
Time to Hospira or its designated Subsidiaries.
(b) TRANSFER OF THE ASSETS AND LIABILITIES. When and as the necessary
Consents for each Delayed U.S./Ex-U.S. Manufacturing Asset or Delayed
U.S./Ex-U.S. Manufacturing Liability are obtained:
(i) Abbott shall, and shall cause each Abbott Subsidiary to,
contribute, assign, transfer, convey and deliver to Hospira or such Hospira
Subsidiaries as Hospira may determine, and Hospira shall, and shall cause
such Hospira Subsidiaries to, accept from Abbott and the Abbott
Subsidiaries all of Xxxxxx'x and the Abbott Subsidiaries' respective
rights, title and interest in and to such Delayed U.S./Ex-U.S.
Manufacturing Asset; and
(ii) Hospira shall, and shall cause such Hospira Subsidiaries as
Hospira may determine to, accept, assume and agree faithfully to perform,
discharge and fulfill such Delayed U.S./Ex-U.S. Manufacturing Liability, in
accordance with its terms.
(c) HOSPIRA PROCEEDING LIABILITIES. Hospira Proceeding Liabilities
shall not be treated as Delayed U.S./Ex-U.S. Manufacturing Liabilities,
notwithstanding the fact that a Consent might be required to substitute parties
to any such Proceeding.
SECTION 2.04. DELAYED EX-U.S. COMMERCIAL ASSETS AND LIABILITIES AND
LOCAL CLOSINGS. The Parties agree that the International Commercial Operations
Agreement and the Transition Marketing and Distribution Services Agreements
shall govern certain matters between Abbott and the Abbott Subsidiaries, on the
one hand, and Hospira and the Hospira Subsidiaries, on the other hand, regarding
the Delayed Ex-U.S. Commercial Assets and Delayed Ex-U.S. Commercial Liabilities
during the International Transition Period and the sale, transfer, conveyance,
acceptance and assumption thereof at the Local Closings contemplated by the
Transition Marketing and Distribution Services Agreements to and by Hospira,
Hospira Subsidiaries or designees of Hospira.
SECTION 2.05. ANCILLARY AGREEMENTS. Prior to the Effective Time, the
Parties shall execute and deliver, or where applicable shall cause their
respective Subsidiaries to execute and deliver, each Ancillary Agreement to
which they are intended to be a party; PROVIDED, HOWEVER, that if this ARTICLE
II calls for an Ancillary Agreement to be executed and delivered on or as of a
later time, it shall be executed and delivered on or as of such later time.
SECTION 2.06. DISCLAIMER OF REPRESENTATIONS AND WARRANTIES. EXCEPT AS
SET FORTH IN SECTION 9.01(C), THE PARTIES UNDERSTAND AND AGREE THAT NEITHER
PARTY NOR ANY PARTY TO ANY ANCILLARY AGREEMENT IS MAKING ANY REPRESENTATIONS OR
WARRANTIES WHATSOEVER AS TO ANY HOSPIRA ASSETS OR HOSPIRA LIABILITIES OR THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY ANCILLARY AGREEMENT,
INCLUDING ANY REPRESENTATIONS OR WARRANTIES AS TO: (I) ANY CONSENTS REQUIRED IN
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CONNECTION THEREWITH; (II) THE VALUE OF OR FREEDOM FROM ANY SECURITY INTERESTS
IN, OR ANY OTHER MATTER CONCERNING, ANY HOSPIRA ASSET; (III) THE ABSENCE OF ANY
DEFENSES TO OR RIGHT OF SETOFF AGAINST OR FREEDOM FROM COUNTERCLAIM WITH RESPECT
TO ANY CLAIM; (IV) THE MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF
ANY OF THE HOSPIRA ASSETS; OR (V) THE LEGAL SUFFICIENCY OF ANY CONVEYANCE AND
ASSUMPTION INSTRUMENTS TO CONVEY TITLE TO ANY HOSPIRA ASSET OR THING OF VALUE
UPON THE EXECUTION, DELIVERY AND FILING OF SUCH CONVEYANCE AND ASSUMPTION
INSTRUMENTS. THE PARTIES FURTHER UNDERSTAND AND AGREE THAT ALL HOSPIRA ASSETS
ARE BEING TRANSFERRED ON AN "AS IS," "WHERE IS" BASIS (AND, IN THE CASE OF ANY
REAL PROPERTY, BY MEANS OF A QUITCLAIM OR SIMILAR FORM DEED OR CONVEYANCE), AND
HOSPIRA AND ITS SUBSIDIARIES SHALL BEAR THE ECONOMIC AND LEGAL RISKS THAT: (A)
ANY CONVEYANCE AND ASSUMPTION INSTRUMENT MAY PROVE TO BE INSUFFICIENT TO VEST IN
THE TRANSFEREE GOOD AND MARKETABLE TITLE, FREE AND CLEAR OF ANY SECURITY
INTEREST; AND (B) ANY NECESSARY CONSENTS ARE NOT OBTAINED OR THAT ANY
REQUIREMENTS OF LAWS, AGREEMENTS, SECURITY INTERESTS OR JUDGMENTS ARE NOT
COMPLIED WITH.
SECTION 2.07. FINANCING ARRANGEMENTS. Prior to the Effective Time,
Abbott and Hospira shall enter into the Financing Agreements. Abbott and Hospira
agree to take all necessary actions to permit Abbott to borrow up to the full
principal amount permitted by the Financing Agreements prior to the Effective
Time (without any obligation to pay such amount to Hospira) and to assure the
assignment to and the assumption by Hospira of all obligations thereunder and
the full release and discharge of Abbott and each Abbott Subsidiary from all of
Xxxxxx'x and the Abbott Subsidiaries' obligations thereunder as of immediately
before the Effective Time in accordance with the terms of the Financing
Agreements. Prior to the Effective Time, Abbott and Hospira shall participate in
the preparation of all materials as may be necessary or advisable to secure
funding pursuant to the Financing Agreements.
SECTION 2.08. TERMINATION OF AGREEMENTS.
(a) TERMINATION OF AGREEMENTS BETWEEN ABBOTT AND HOSPIRA. Except as
set forth in subsection (b) below, Hospira and each Hospira Subsidiary, on the
one hand, and Abbott and each Abbott Subsidiary, on the other hand, hereby
terminate and agree to cause to be terminated all agreements, arrangements,
commitments or understandings, whether or not in writing, entered into prior to
the Effective Time between or among Hospira or any Hospira Subsidiaries, on the
one hand, and Abbott or any Abbott Subsidiaries, on the other hand, effective as
of immediately prior to the Effective Time; PROVIDED that the provisions of this
subsection (a) shall not terminate any rights or obligations between Abbott and
any Abbott Subsidiary or between any Abbott Subsidiaries.
(b) EXCEPTIONS. The provisions of subsection (a) above shall not apply
to any of the following agreements, arrangements, commitments or understandings
(or to any of the provisions thereof): (i) this Agreement and the Ancillary
Agreements; (ii) any agreements, arrangements, commitments or understandings
listed or described on SCHEDULE 2.08(b); (iii) any
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agreements, arrangements, commitments or understandings to which any Third Party
is a party; and (iv) any agreements, arrangements, commitments or understandings
to which any non-wholly owned Subsidiary of Abbott or Hospira, as the case may
be, is a party (it being understood that directors' qualifying shares or similar
interests shall be disregarded for purposes of determining whether a Subsidiary
is wholly owned). To the extent that the rights and obligations of Abbott or any
Abbott Subsidiaries under any agreements, arrangements, commitments or
understandings not terminated under this SECTION 2.08 constitute Hospira Assets
or Hospira Liabilities, they shall be assigned or assumed pursuant to this
Agreement.
SECTION 2.09. SETTLEMENT OF ACCOUNTS BETWEEN ABBOTT AND HOSPIRA. All
intercompany receivables, payables and loans (other than intercompany
receivables, payables and loans otherwise specifically provided for in this
Agreement or any Ancillary Agreement as described on SCHEDULE 2.09), including
in respect of any cash balances, any cash balances representing deposited checks
or drafts for which only a provisional credit has been allowed or any cash held
in any centralized cash management system, between Abbott or any Abbott
Subsidiary, on the one hand, and Hospira or any Hospira Subsidiary, on the other
hand, and to which there are no Third Parties, shall, immediately prior to the
Effective Time, be settled, capitalized, cancelled, assigned or assumed by
Abbott or one or more Abbott Subsidiaries, in each case in the manner determined
prior to the Effective Time by duly authorized representatives of Abbott and
Hospira.
SECTION 2.10. NOVATION OF HOSPIRA LIABILITIES. Each of Abbott and
Hospira, at the request of the other, shall use commercially reasonable efforts
to: (a) obtain, or cause to be obtained, any Consent, substitution, or amendment
required to novate or assign all Hospira Liabilities and obtain in writing the
unconditional release of Abbott and any Abbott Subsidiary that is a party to any
such arrangements, so that, in any such case, Hospira and its designated
Subsidiaries shall be solely responsible for such Hospira Liabilities; (b)
unconditionally terminate and release any guarantees by Abbott or any Abbott
Subsidiary of any Hospira Liabilities; and (c) unconditionally terminate and
release any guarantees by Hospira or any Hospira Subsidiary of any Abbott
Liabilities; PROVIDED, HOWEVER, that neither Abbott nor Hospira (nor any of
their respective Subsidiaries) shall be obligated to pay any consideration,
grant any concession or incur any additional Liability to any Third Party other
than ordinary and customary fees to a Governmental Authority from whom such
Consents, substitutions, amendments, terminations or releases are requested; and
PROVIDED, FURTHER, that nothing herein shall require any attempt to substitute
Hospira or any Hospira Subsidiary for Abbott or any Abbott Subsidiary as a party
in any Proceeding.
SECTION 2.11. MIXED CONTRACTS; MIXED ACCOUNTS.
(a) MIXED CONTRACTS. Unless the Parties agree otherwise, any agreement
to which Abbott or any of its Subsidiaries is a party prior to the Effective
Time that inures to the benefit or burden of each of the Abbott Business and the
Hospira Business (a "MIXED CONTRACT") shall be assigned in part to Hospira or
its Subsidiaries, if so assignable, prior to, on or after the Effective Time, so
that each Party or their respective Subsidiaries shall be entitled to the rights
and benefits and shall assume the related portion of any obligations and
Liabilities inuring to their respective businesses; PROVIDED, HOWEVER, that in
no event shall Abbott or any of its Subsidiaries be required to assign any Mixed
Contract in its entirety. If any Mixed Contract cannot be so
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partially assigned, Abbott and Hospira shall, and shall cause each of their
respective Subsidiaries to, take such other reasonable and permissible actions
to cause: (i) the Assets associated with that portion of each Mixed Contract
that relates to the Hospira Business to be enjoyed by Hospira or a Hospira
Subsidiary; (ii) the Liabilities associated with that portion of each Mixed
Contract that relates to the Hospira Business to be borne by Hospira or a
Hospira Subsidiary; (iii) the Assets associated with that portion of each Mixed
Contract that relates to the Abbott Business to be enjoyed by Abbott or an
Abbott Subsidiary; and (iv) the Liabilities associated with that portion of each
Mixed Contract that relates to the Abbott Business to be borne by Abbott or an
Abbott Subsidiary.
(b) MIXED ACCOUNTS. Except as may otherwise be agreed by the Parties,
the Parties shall not seek to assign any accounts receivable or accounts payable
relating to both the Abbott Business and the Hospira Business ("MIXED
ACCOUNTS"). Abbott and Hospira shall, and shall cause each of their respective
Subsidiaries to, take such other reasonable and permissible actions to cause:
(i) the Assets associated with that portion of each Mixed Account that relates
to the Abbott Business to be enjoyed by Abbott or an Abbott Subsidiary; (ii) the
Liabilities associated with that portion of each Mixed Account that relates to
the Abbott Business to be borne by Abbott or an Abbott Subsidiary; (iii) the
Assets associated with that portion of each Mixed Account that relates to the
Hospira Business to be enjoyed by Hospira or a Hospira Subsidiary; and (iv) the
Liabilities associated with that portion of each Mixed Account that relates to
the Hospira Business to be borne by Hospira or a Hospira Subsidiary.
(c) NO PAYMENTS. Nothing in this Section shall require Abbott, Hospira
or any of their respective Subsidiaries to make any payment, incur any
obligation or grant any concession to any Third Party, other than ordinary and
customary fees to Governmental Authorities, in order to effect any transaction
contemplated by this Section.
SECTION 2.12. FURTHER ASSURANCES.
(a) ADDITIONAL ACTIONS. Except as set forth in SECTION 3.04, in
addition to the actions specifically provided for elsewhere in this Agreement,
each Party shall, and shall cause each of its respective Subsidiaries to, use
commercially reasonable efforts, prior to, at and after the Effective Time to
take, or cause to be taken, all actions, and to do, or cause to be done, all
things, necessary or advisable under applicable laws, regulations and agreements
to consummate the transactions contemplated by this Agreement and the Ancillary
Agreements; PROVIDED, HOWEVER, that neither Abbott nor Hospira (nor any of their
respective Subsidiaries) shall be obligated under this Section to pay any
consideration, grant any concession or incur any additional Liability to any
Third Party other than ordinary and customary fees paid to a Governmental
Authority.
(b) COOPERATION. Without limiting the foregoing, prior to, at and
after the Effective Time, each Party shall, and shall cause each of its
Subsidiaries to, cooperate with the other Party without any further
consideration to execute and deliver, or use commercially reasonable efforts to
cause to be executed and delivered, all Conveyance and Assumption Instruments
and to make all filings with, and to obtain all Consents of, any Governmental
Authority or any other Person under any permit, license, agreement, indenture or
other instrument (including any Consents), and to take all such other actions as
such Party may
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reasonably be requested to take by the other Party from time to time, consistent
with the terms of this Agreement and the Ancillary Agreements, in order to
effectuate the provisions and purposes of this Agreement and the Ancillary
Agreements and the transfers of the Hospira Assets and the assignment and
assumption of the Hospira Liabilities and the other transactions contemplated
hereby and thereby.
(c) MISALLOCATIONS. In the event that at any time or from time to time
(whether prior to, at or after the Effective Time), one Party or any of its
Subsidiaries shall receive or otherwise possess any Asset that is allocated to
the other Party pursuant to this Agreement or any Ancillary Agreement, the first
Party shall promptly transfer, or cause its Subsidiary to transfer, such Asset
to the Party so entitled thereto or such Party's Subsidiary or designee.
SECTION 2.13. CLARIFICATION OF INTENT. Notwithstanding anything in
this Agreement to the contrary and for further clarity: (a) all Assets of
Abbott, any Abbott Subsidiary, Hospira or any Hospira Subsidiary are intended to
remain the property of Abbott or the Abbott Subsidiaries after the Effective
Time until transferred, sold, consumed or otherwise disposed of by Abbott or the
Abbott Subsidiaries, unless such Assets are Hospira Assets; and (b) to the
extent that a Liability is a Hospira Liability it shall not be deemed to be an
Abbott Liability.
SECTION 2.14. TRANSITION COMMITTEE. To facilitate an orderly
separation and transition of the Hospira Business from the Abbott Business, each
Party shall designate, prior to the Effective Time, a key transition contact and
such other contacts in specific functional areas as the Parties may agree to be
responsible for communication and coordination between the Parties regarding the
matters contemplated by this Agreement and the Principal Ancillary Agreements.
The Parties shall cause their respective key transition contacts to meet with
their counterparts to establish procedures for such cooperation within 35 days
after the Effective Time.
SECTION 2.15. ACCOUNTING FOR DEFERRED TAXES. No later than November 1,
2005, Abbott shall determine the difference, if any, between the Estimated
Deferred Taxes and the Actual Deferred Taxes (the "ADJUSTMENT") and shall
provide Hospira with a schedule that sets forth the Adjustment and how it was
calculated. Hospira shall notify Abbott of any disagreement with the Adjustment
within 20 days of receipt of the schedule setting forth the Adjustment and its
calculation. Hospira and Abbott shall use commercially reasonable efforts to
resolve any disagreement by December 15, 2005 and, if the Parties are unable to
agree prior to such date, the Parties shall utilize the ADR procedures set forth
in SECTION 7.01 to resolve such disagreement (such Adjustment, as modified to
reflect the disposition of any disagreement, the "FINAL ADJUSTMENT"). Abbott and
Hospira shall, and shall cause their respective Subsidiaries to, reflect the
Final Adjustment to shareholders' equity on their respective books.
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ARTICLE III
THE DISTRIBUTION
SECTION 3.01. ACTIONS PRIOR TO THE DISTRIBUTION. Prior to the
Effective Time and subject to the terms and conditions set forth herein, the
Parties shall take, or cause to be taken, the following actions in connection
with the Distribution:
(a) NOTICE TO NYSE. Abbott shall, to the extent possible, give the
NYSE not less than ten days' advance notice of the Record Date in compliance
with Rule 10b-17 under the Exchange Act.
(b) SECURITIES LAW MATTERS. Hospira shall file any amendments or
supplements to the Registration Statement as may be necessary or advisable in
order to cause the Registration Statement to become and remain effective as
required by the Commission or federal, state or other applicable securities
laws. Abbott and Hospira shall cooperate in preparing, filing with the
Commission and causing to become effective registration statements or amendments
thereof which are required to reflect the establishment of, or amendments to,
any employee benefit and other plans necessary or advisable in connection with
the transactions contemplated by this Agreement and the Ancillary Agreements.
Abbott and Hospira shall take all such action as may be necessary or advisable
under the securities or blue sky laws of the United States (and any comparable
laws under any non-U.S. jurisdiction) in connection with the Distribution.
(c) MAILING OF INFORMATION STATEMENT. Abbott shall, as soon as
practicable after the Registration Statement is declared effective under the
Exchange Act and the board of directors of Abbott has approved the Distribution,
cause the Information Statement to be mailed to the Record Holders.
(d) SATISFYING CONDITIONS TO DISTRIBUTION. Abbott and Hospira shall
cooperate and take all actions necessary or advisable to cause the conditions to
the Distribution set forth in this ARTICLE III to be satisfied and to effect the
Distribution at the Effective Time.
SECTION 3.02. THE DISTRIBUTION. Subject to the conditions contained
herein, on or prior to the Distribution Date:
(a) DELIVERY OF SHARE CERTIFICATES. Abbott shall deliver to the Agent
the share certificates representing the Hospira Common Stock, endorsed by Abbott
in blank, for the benefit of the Record Holders; and
(b) DISTRIBUTION OF SHARES AND CASH. Abbott shall instruct the Agent
to distribute, as soon as practicable following the Distribution, to the Record
Holders the following:
(i) [___] of a share of Hospira Common Stock for each Abbott Common
Share outstanding as of the Record Date; and
(ii) cash, if applicable, in lieu of fractional shares obtained in the
manner provided in SECTION 3.03.
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SECTION 3.03. FRACTIONAL SHARES; UNCLAIMED SHARES.
(a) NO FRACTIONAL SHARES. Notwithstanding anything herein to the
contrary, no fractional shares of Hospira Common Stock shall be issued in
connection with the Distribution, and any such fractional share interests to
which a Record Holder would otherwise be entitled shall not entitle such Record
Holder to vote or to any rights as a stockholder of Hospira. In lieu of any such
fractional shares, each Record Holder who, but for the provisions of this
SECTION 3.03, would be entitled to receive a fractional share interest of
Hospira Common Stock pursuant to the Distribution shall be paid cash, without
any interest thereon, as hereinafter provided. Abbott shall instruct the Agent
to determine the number of whole shares and fractional shares of Hospira Common
Stock allocable to each Record Holder, to aggregate all such fractional shares
into whole shares, to sell the whole shares obtained thereby in the open market
at the then-prevailing prices on behalf of each Record Holder who otherwise
would be entitled to receive fractional share interests and to distribute to
each such Record Holder his, her or its ratable share of the total proceeds of
such sale, after making appropriate deductions of the amounts required for U.S.
federal income tax withholding purposes and after deducting any applicable
transfer Taxes and the costs and expenses of such sale and distribution,
including brokers fees and commissions.
(b) BENEFICIAL OWNERS. Solely for purposes of computing fractional
share interests pursuant to this SECTION 3.03, the beneficial owner of Abbott
Common Shares held of record in the name of a nominee in any nominee account
shall be treated as the holder of record with respect to such shares.
(c) UNCLAIMED STOCK OR CASH. Any Hospira Common Stock or cash in lieu
of fractional shares with respect to Hospira Common Stock that remain unclaimed
by any Record Holder 180 days after the Distribution Date shall be delivered to
Hospira, Hospira shall hold such Hospira Common Stock for the account of such
Record Holder and any such Record Holder shall look only to Hospira for such
Hospira Common Stock and cash, if any, in lieu of fractional share interests,
subject in each case to applicable escheat or other abandoned property laws.
SECTION 3.04. SOLE DISCRETION OF ABBOTT. Until the Effective Time,
Abbott shall have the sole discretion to determine whether to proceed with the
Distribution and any and all terms of the Distribution, including the form,
structure and terms of any transaction(s) or offering(s) to effect the
Distribution and the timing of and conditions to the consummation of the
Distribution. In addition, Abbott may, in its sole discretion, determine the
Distribution Date and may, at any time and from time to time until the Effective
Time, modify or change the terms of the Distribution, including by accelerating
or delaying the timing of the consummation of the Distribution.
SECTION 3.05. CONDITIONS TO THE SEPARATION AND THE DISTRIBUTION.
(a) THE CONDITIONS. In addition to Xxxxxx'x rights under SECTION 3.04,
the satisfaction or waiver by Abbott of the following shall be conditions to
Xxxxxx'x obligation to effect the Separation and the Distribution:
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(i) the Registration Statement shall have been declared effective by
the Commission, and there shall be no stop-order in effect with respect
thereto and no Proceeding for that purpose shall have been instituted by
the Commission;
(ii) Abbott shall have received the proceeds of the borrowings under
the Financing Agreements and shall be satisfied in its sole discretion that
as of the Effective Time it will have no further liability or obligation
whatsoever under the Financing Agreements;
(iii) the actions and filings with regard to state securities and blue
sky laws of the United States (and any comparable laws under any foreign
jurisdictions) described in SECTION 3.01 shall have been taken and, where
applicable, shall have become effective or been accepted;
(iv) the Hospira Common Stock to be distributed in the Distribution
shall have been accepted for listing on the NYSE, subject to official
notice of distribution;
(v) no order, injunction or decree issued by any Governmental
Authority or other legal restraint or prohibition preventing the
consummation of the transactions contemplated by this Agreement or any
Ancillary Agreement shall have been threatened or in effect;
(vi) the private letter ruling from the Internal Revenue Service dated
December 4, 2003 shall continue in effect, to the effect that, among other
things, the Distribution will qualify as a tax-free distribution for U.S.
federal income tax purposes under section 355 of the Code and certain
transactions related to the transfer to Hospira or certain of its
Subsidiaries of certain Hospira Assets and the assumption by Hospira or
certain of its Subsidiaries of certain of the Hospira Liabilities in
connection with the Separation will not result in the recognition of any
gain or loss to Abbott, Hospira, certain Abbott Subsidiaries, certain
Hospira Subsidiaries, Xxxxxx'x shareholders or Hospira's stockholders for
U.S. federal income tax purposes;
(vii) any Consents necessary to consummate the Distribution and the
transactions contemplated by this Agreement to be consummated on or prior
to the Effective Time shall have been obtained and be in full force and
effect;
(viii) no events or developments shall have occurred subsequent to the
date hereof that Abbott believes, in its sole discretion, could result in
an adverse effect on Abbott or on the shareholders of Abbott;
(ix) the Parties shall have performed and complied with all of their
respective covenants, obligations and agreements contained in this
Agreement and required to be performed or complied with by them on or prior
to the Effective Time;
(x) the Parties shall have executed and delivered or, where
applicable, shall have caused their respective Subsidiaries to execute and
deliver, the Ancillary Agreements that are contemplated by this Agreement
to be executed and delivered on or prior to the Effective Time;
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(xi) Xxxxxx Xxxxxxx & Co., Incorporated, or another independent
financial adviser acceptable to Abbott, shall have delivered its opinion to
the board of directors of Abbott confirming the fairness from a financial
point of view to the holders of Abbott Common Shares of the Distribution,
and such opinion shall be acceptable to Abbott in form and substance in
Xxxxxx'x sole discretion and such opinion shall not have been withdrawn or
rescinded; and
(xii) Xxxxxxxx Xxxxx Xxxxxx & Xxxxx Financial Advisors, Inc., or
another independent appraisal firm acceptable to Abbott, shall have
delivered one or more opinions to the board of directors of Abbott
confirming the solvency and financial viability of Abbott before the
consummation of the Distribution and each of Abbott and Hospira after
consummation of the Distribution, and such opinions shall be acceptable to
Abbott in form and substance in Xxxxxx'x sole discretion and such opinions
shall not have been withdrawn or rescinded.
(b) CONDITIONS FOR BENEFIT OF ABBOTT. The foregoing conditions are for
the sole benefit of Abbott and shall not give rise to or create any duty on the
part of Abbott or Xxxxxx'x board of directors to waive or not waive such
conditions or in any way limit Xxxxxx'x right to terminate this Agreement as set
forth in ARTICLE VIII or alter the consequences of any such termination from
those specified in such Article. Any determination made by Abbott prior to the
Distribution concerning the satisfaction or waiver of any or all of the
conditions set forth in this Section shall be conclusive. If Abbott waives any
material condition, it shall promptly issue a press release disclosing such fact
and file a report on Form 8-K with the Commission describing such waiver.
ARTICLE IV
MUTUAL RELEASES; INDEMNIFICATION
SECTION 4.01. RELEASES.
(a) HOSPIRA RELEASE OF ABBOTT. Except as provided in SECTION 4.01(c)
and in the proviso to this subsection (a), effective as of the Effective Time,
Hospira does hereby, for itself, each Hospira Subsidiary, and their respective
successors and assigns, and, to the extent permitted by law, all Persons who at
any time prior to the Effective Time have been directors, officers, agents or
employees of Hospira or any Hospira Subsidiary (in each case, in their
respective capacities as such), remise, release and forever discharge: (1)
Abbott, each Abbott Subsidiary, and their respective successors and assigns; (2)
all Persons who at any time are or have been shareholders, directors, officers,
agents, representatives, counsel or employees of Abbott or any Abbott Subsidiary
(in each case, in their respective capacities as such), and their respective
heirs, executors, administrators, successors and assigns; and (3) all Persons
identified on SCHEDULE 4.01, in each such case from:
(i) all Hospira Liabilities; and
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(ii) all Liabilities existing or arising: (A) in connection with the
implementation of the Separation and the Distribution; or (B) from actions,
inactions, events, omissions, conditions, facts or circumstances occurring
or existing prior to the Effective Time (whether or not such Liabilities
cease being contingent, mature, become known, are asserted or foreseen, or
accrue, in each case before, at or after the Effective Time), in each case
relating to, arising out of or resulting from the Hospira Business, the
Hospira Assets or the Hospira Liabilities;
PROVIDED, HOWEVER, that nothing in this subsection (a) shall relieve the Persons
released in this subsection (a) from: (x) any Liability expressly allocated to
Abbott or any Abbott Subsidiary in this Agreement (including the indemnification
obligations in SECTION 4.03 and the contribution obligations in SECTION 4.07),
any Principal Ancillary Agreement or any other agreement, arrangement,
commitment or understanding to the extent expressly preserved pursuant to
SECTION 2.08(b); or (y) any Liability the release of which would result in the
release of any Person other than the Persons released in this subsection (a),
and, PROVIDED FURTHER, that nothing in this subsection (a) shall relieve any
Person released in this subsection (a) who, after the Effective Time, is a
director, officer or employee of Hospira or any of the Hospira Subsidiaries and
is no longer a director, officer or employee of Abbott or any of the Abbott
Subsidiaries from Liabilities arising out of, relating to or resulting from his
or her service as a director, officer or employee of Hospira or any of the
Hospira Subsidiaries after the Effective Time.
(b) ABBOTT RELEASE OF HOSPIRA. Except as provided in SECTION 4.01(c)
and in the proviso to this subsection (b), effective as of the Effective Time,
Abbott does hereby, for itself, each Abbott Subsidiary, and their respective
successors and assigns, and, to the extent permitted by law, all Persons who at
any time prior to the Effective Time have been directors, officers, agents or
employees of Abbott or any Abbott Subsidiary (in each case, in their respective
capacities as such), remise, release and forever discharge Hospira, each Hospira
Subsidiary and their respective successors and assigns from:
(i) all Abbott Liabilities; and
(ii) all Liabilities existing or arising in connection with the
implementation of the Separation and the Distribution;
PROVIDED, HOWEVER, that nothing in this subsection (b) shall release the Persons
released in this subsection (b) from: (x) any Liability expressly allocated to
Hospira or any Hospira Subsidiary in this Agreement (including the
indemnification obligations in SECTION 4.02 and the contribution obligations in
SECTION 4.07), any Principal Ancillary Agreement or any other agreement,
arrangement, commitment or understanding to the extent expressly preserved
pursuant to SECTION 2.08(b); or (y) any Liability the release of which would
result in the release of any Person other than the Persons released in this
subsection (b).
(c) ABBOTT OBLIGATIONS NOT AFFECTED. Nothing contained in this ARTICLE
IV shall release Abbott or any Abbott Subsidiary from honoring their existing
obligations: (i) to indemnify any director, officer or employee of Hospira or
any of its Subsidiaries who was a director, officer or employee of Abbott or any
Abbott Subsidiary on or prior to the Effective Time, to the extent such
director, officer or employee was entitled to such indemnification pursuant to
then existing obligations; or (ii) to provide any employment, post-employment or
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retirement benefits to any director, officer or employee of Hospira or any of
its Subsidiaries who was a director, officer or employee of Abbott or any Abbott
Subsidiary on or prior to the Effective Time, to the extent such director,
officer or employee was entitled to such benefits pursuant to then existing
obligations, except as otherwise provided in the Employee Benefits Agreement.
(d) NO HOSPIRA CLAIMS. Hospira shall not make, and shall not permit
any Hospira Subsidiary to make, any claim or demand, or commence any Proceeding
asserting any claim or demand, including any claim of contribution or
indemnification, against Abbott or any Abbott Subsidiary or any other Person
released pursuant to SECTION 4.01(a), with respect to any Liabilities released
pursuant to SECTION 4.01(a).
(e) NO ABBOTT CLAIMS. Abbott shall not make, and shall not permit any
Abbott Subsidiary to make, any claim or demand, or commence any Proceeding
asserting any claim or demand, including any claim of contribution or
indemnification, against Hospira or any Hospira Subsidiary or any other Person
released pursuant to SECTION 4.01(b), with respect to any Liabilities released
pursuant to SECTION 4.01(b).
(f) SUBSIDIARY RELEASES. At any time, at the request of either Party,
the other Party shall cause its Subsidiaries to execute and deliver releases
reflecting the provisions hereof.
SECTION 4.02. INDEMNIFICATION BY HOSPIRA. Except as otherwise
specifically set forth in any provision of this Agreement or of any Principal
Ancillary Agreement, Hospira shall, to the fullest extent permitted by law,
indemnify, defend and hold harmless each of the Abbott Indemnitees from and
against all Hospira Indemnity Obligations.
SECTION 4.03. INDEMNIFICATION BY ABBOTT. Except as otherwise
specifically set forth in any provision of this Agreement or of any Principal
Ancillary Agreement, Abbott shall, to the fullest extent permitted by law,
indemnify, defend and hold harmless each of the Hospira Indemnitees from and
against all Abbott Indemnity Obligations; PROVIDED, HOWEVER, that the indemnity
in this SECTION 4.03 for Abbott Liabilities shall not extend to a former Abbott
director, officer, employee or agent to the extent such Person was grossly
negligent or engaged in willful misconduct in connection with the Abbott
Liabilities for which indemnification is sought.
SECTION 4.04. INDEMNIFICATION OBLIGATIONS NET OF INSURANCE PROCEEDS
AND OTHER AMOUNTS.
(a) INSURANCE PROCEEDS AND OTHER AMOUNTS. The Parties intend that any
Liability subject to indemnification or contribution pursuant to this Agreement
or any Ancillary Agreement: (i) shall be reduced by any Insurance Proceeds or
other amounts recovered (net of any out-of-pocket costs or expenses incurred in
the collection thereof) from any Person by or on behalf of the Indemnitee in
respect of any indemnifiable Liability; (ii) shall not be increased to take into
account any Tax costs incurred by the Indemnitee arising from any Indemnity
Payments received from the Indemnifying Party (as defined below); and (iii)
shall not be reduced to take into account any Tax benefit received by the
Indemnitee arising from the incurrence or payment of any Indemnity Payment.
Accordingly, the amount which any Party against whom a claim is made for
indemnification under this Agreement (an "INDEMNIFYING PARTY") is required to
pay to
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any Indemnitee shall be reduced by any Insurance Proceeds or any other amounts
theretofore recovered (net of any out-of-pocket costs or expenses incurred in
the collection thereof) by or on behalf of the Indemnitee in respect of the
related Liability. If an Indemnitee receives a payment (an "INDEMNITY PAYMENT")
required by this Agreement from an Indemnifying Party in respect of any
Liability and subsequently receives Insurance Proceeds or any other amounts in
respect of the related Liability, then the Indemnitee shall pay to the
Indemnifying Party an amount equal to the excess of the Indemnity Payment
received over the amount of the Indemnity Payment that would have been due if
the Insurance Proceeds or such other amounts (net of any out-of-pocket costs or
expenses incurred in the collection thereof) had been received, realized or
recovered before the Indemnity Payment was made.
(b) INSURERS AND OTHER THIRD PARTIES NOT RELIEVED. An insurer or other
Third Party that would otherwise be obligated to pay any amount shall not be
relieved of the responsibility with respect thereto or have any subrogation
rights with respect thereto by virtue of any provision contained in this
Agreement or any Ancillary Agreement; it being understood and agreed that no
insurer or any other Third Party shall be entitled to a "windfall" (e.g., a
benefit they would not be entitled to receive in the absence of the
indemnification or release provisions) by virtue of any provision contained in
this Agreement or any Ancillary Agreement. Each Party shall, and shall cause its
Subsidiaries to, use commercially reasonable efforts to collect or recover, or
allow the Indemnifying Party to collect or recover, any Insurance Proceeds that
may be collectible or recoverable respecting the Liabilities for which
indemnification may be available under this ARTICLE IV. Notwithstanding the
foregoing, an Indemnifying Party may not delay making any indemnification
payment required under the terms of this Agreement, or otherwise satisfying any
indemnification obligation, pending the outcome of any claim, suit, action,
demand or proceeding to collect or recover Insurance Proceeds, and an Indemnitee
need not attempt to collect any Insurance Proceeds prior to making a claim for
indemnification under this Agreement.
SECTION 4.05. PROCEDURES FOR INDEMNIFICATION OF THIRD PARTY CLAIMS.
(a) NOTICE OF CLAIMS. If, at or following the date of this Agreement,
an Indemnitee receives notice or otherwise learns of the assertion or
commencement by a Third Party of any Proceeding against the Indemnitee with
respect to which the Indemnitee believes that Hospira (in the case of an Abbott
Indemnitee) or Abbott (in the case of an Hospira Indemnitee) is obligated to
provide indemnification to such Indemnitee pursuant to this Agreement or any
Ancillary Agreement (collectively, a "THIRD PARTY CLAIM"), such Indemnitee shall
give such Indemnifying Party written notice thereof (the "NOTICE") within 20
days after becoming aware of such Third Party Claim. The Notice must describe
the Third Party Claim in reasonable detail. Notwithstanding the foregoing, the
failure of any Indemnitee to give the Notice as provided in this subsection (a)
shall not relieve the related Indemnifying Party of its obligations under this
ARTICLE IV, except to the extent that such Indemnifying Party is actually
prejudiced by such failure to give the Notice.
(b) CONTROL OF DEFENSE. Abbott or an Abbott Subsidiary shall have the
right to conduct and control the defense of any Third Party Claim; PROVIDED,
HOWEVER, that: (i) a Hospira Indemnitee may conduct and control the defense of
any Third Party Claim in which no Abbott Indemnitee is a named party and a
Hospira Indemnitee is a named party unless and until Hospira
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asserts that such Third Party Claim may involve Abbott Indemnity Obligations;
and (ii) in connection with any Third Party Claim with respect to which an
Abbott Indemnitee is seeking indemnification under this Agreement, if within 20
days after receipt of the Notice Hospira irrevocably acknowledges and agrees in
writing with Abbott and any Abbott Indemnitee that all Liabilities relating to,
arising out of or resulting from the Third Party Claim are and shall remain
solely Hospira Liabilities, then Hospira shall thereafter have the right to
conduct and control the defense of such Third Party Claim at Hospira's sole cost
and expense. If the Party otherwise entitled to conduct and control the defense
of any Third Party Claim hereunder nevertheless fails to assume the defense of
such Third Party Claim then the Indemnitee that is the subject of such Third
Party Claim shall be entitled to conduct and control the defense of such Third
Party Claim. Notwithstanding anything to the contrary in this Agreement, the
defense of any Proceeding described on SCHEDULE 1.01(n) or in Item 2 on SCHEDULE
1.01(c) shall be conducted and controlled as set forth on such schedules.
(c) ALLOCATION OF DEFENSE COSTS. Except as otherwise provided herein
(including SECTION 7.01) and regardless of which Party conducts and controls the
defense of any Third Party Claim, the proportion of the costs and expenses of
the defense of any Third Party Claim equal to the proportion that the Hospira
Proceeding Liabilities, if any, bears to the total Proceeding Liabilities with
respect to such Third Party Claim shall be deemed to constitute Hospira
Liabilities, and the remainder, if any, of such costs and expenses shall be
deemed to constitute Abbott Liabilities; PROVIDED, HOWEVER, unless the Parties
agree otherwise, the Parties shall initially share equally the costs and
expenses of the defense of such Third Party Claim and adjust the burden of those
costs and expenses pursuant to this subsection (c) immediately following the
disposition or settlement of the Third Party Claim and, PROVIDED FURTHER, that
the costs and expenses of the Proceedings described on SCHEDULE 1.01(n) and in
Item 2 on SCHEDULE 1.01(c) shall be allocated as set forth on such schedules.
(d) RIGHT TO MONITOR AND PARTICIPATE. An Indemnitee or Indemnifying
Party that is not entitled to conduct and control the defense of any Third Party
Claim nevertheless shall have the right to employ separate counsel of its own
choosing to monitor and participate in the defense of any Third Party Claim for
which it is a potential Indemnitee or Indemnifying Party, but the fees and
expenses of such counsel shall be at the expense of such Indemnitee or
Indemnifying Party, as the case may be, and shall not be subject to subsection
(c) above; PROVIDED, HOWEVER, that the Hospira Indemnitees shall have no right
to monitor and participate in the defense of any Proceedings described on
SCHEDULE 1.01(n), except to the extent provided on such schedule.
(e) NO SETTLEMENT. Neither Party may settle or compromise any Third
Party Claim for which either Party is seeking to be indemnified hereunder
without the prior written consent of the other Party, which consent may not be
unreasonably delayed or withheld; PROVIDED, HOWEVER, that the Proceedings
described on SCHEDULE 1.01(n) may be settled only as provided on such schedule.
(f) PENDING THIRD PARTY CLAIMS. The provisions of this ARTICLE IV
shall apply to Third Party Claims that are already pending or asserted,
including those set forth on SCHEDULE 1.01(i), as well as Third Party Claims
brought or asserted after the date of this
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Agreement. There shall be no requirement to give a Notice with respect to
pending Third Party Claims as such claims exist as of the Effective Time.
(g) ALLOCATION OF PROCEEDING LIABILITIES. The Parties acknowledge that
Proceeding Liabilities (regardless of the parties to the applicable Proceeding)
may be partly Abbott Liabilities and partly Hospira Liabilities, except as
otherwise provided for in SCHEDULE 1.01(n) or in Item 2 on SCHEDULE 1.01(c). If
the Parties cannot agree on an allocation of any such Proceeding Liabilities,
they shall resolve the matter pursuant to the procedures set forth in SECTION
7.01. Neither Party shall, nor shall either Party permit its Subsidiaries to,
file third party claims or cross-claims against the other Party or its
Subsidiaries in a Proceeding in which a Third Party Claim is being resolved.
SECTION 4.06. ADDITIONAL MATTERS.
(a) NOTICE OF CLAIMS. Any claim for indemnity under this Agreement or
any Ancillary Agreement which does not result from a Third Party Claim must be
asserted by written notice given by the Indemnitee to the applicable
Indemnifying Party; PROVIDED, that the failure by an Indemnitee to so assert any
such claim shall not prejudice the ability of the Indemnitee to do so at a later
time except to the extent (if any) that the Indemnifying Party is prejudiced
thereby. Such Indemnifying Party shall have a period of 30 days after the
receipt of such notice within which to respond thereto. If such Indemnifying
Party does not respond within such 30-day period, such Indemnifying Party shall
be deemed to have refused to accept responsibility to make payment. If such
Indemnifying Party does not respond within such 30-day period or rejects such
claim in whole or in part, such Indemnitee shall be free to pursue such remedies
as may be available to such Party as contemplated by this Agreement and the
Principal Ancillary Agreements, as applicable.
(b) SUBROGATION. In the event of payment by or on behalf of any
Indemnifying Party to any Indemnitee in connection with any Third Party Claim,
such Indemnifying Party shall be subrogated to and shall stand in the place of
such Indemnitee as to any events or circumstances in respect of which such
Indemnitee may have any right, defense or claim relating to such Third Party
Claim against any claimant or plaintiff asserting such Third Party Claim or
against any other Person. Such Indemnitee shall cooperate with such Indemnifying
Party in a reasonable manner, and at the cost and expense of such Indemnifying
Party, in prosecuting any subrogated right, defense or claim.
(c) PURSUIT OF CLAIMS AGAINST THIRD PARTIES. If: (i) a Party incurs
any Liability arising out of any Principal Ancillary Agreement; (ii) an adequate
legal or equitable remedy is not available for any reason against the other
Party to satisfy the Liability incurred by the incurring Party; and (iii) a
legal or equitable remedy may be available to the other Party against a Third
Party for such Liability, then the other Party will use its commercially
reasonable efforts to cooperate with the incurring Party, at the incurring
Party's expense, to permit the incurring Party to obtain the benefits of such
legal or equitable remedy against the Third Party.
(d) DIRECTORS AND OFFICERS INSURANCE. If, during the six-year period
following the Effective Time, Abbott chooses to purchase directors and officers
insurance (it being understood that the decision to do so and the terms and
conditions of such insurance shall be at Xxxxxx'x sole
30
discretion), Abbott will use commercially reasonable efforts to cause that
insurance to provide coverage to Hospira directors, officers and employees who
were formerly directors or officers of Abbott or its Subsidiaries for their
service as directors or officers of Abbott or its Subsidiaries.
(e) CURRENCY CONVERSION. In the event that any indemnification payment
required to be made hereunder or under any Ancillary Agreement may be
denominated in a currency other than U.S. Dollars, the amount of such payment
shall be translated into U.S. Dollars using the foreign exchange rate for such
currency determined in accordance with the following rules:
(i) with respect to any indemnifiable Liability arising from the
payment by a financial institution under a guarantee, comfort letter,
letter of credit, foreign exchange contract or similar instrument, the
foreign exchange rate for such currency shall be the Month End Rate for the
calendar month in which such financial institution is reimbursed; and
(ii) with respect to any indemnifiable Liability not covered by clause
(i) above, the foreign exchange rate for such currency shall be the Month
End Rate for the calendar month in which notice of the claim with respect
to such indemnifiable Liability is given to the Indemnitee.
SECTION 4.07. RIGHT OF CONTRIBUTION.
(a) CONTRIBUTION BY HOSPIRA. If any right of indemnification contained
in SECTION 4.02 is held unenforceable or is unavailable for any reason, then
Hospira, in lieu of indemnifying the Abbott Indemnitees, shall contribute to the
amounts paid or payable by the Abbott Indemnitees in such proportion as is
appropriate to reflect the relative fault of Hospira and the Hospira
Subsidiaries, on the one hand, and the Abbott Indemnitees entitled to
contribution, on the other hand.
(b) CONTRIBUTION BY ABBOTT. If any right of indemnification contained
in SECTION 4.03 is held unenforceable or is unavailable for any reason, then
Abbott, in lieu of indemnifying the Hospira Indemnitees, shall contribute to the
amounts paid or payable by the Hospira Indemnitees in such proportion as is
appropriate to reflect the relative fault of Abbott and the Abbott Subsidiaries,
on the one hand, and the Hospira Indemnitees entitled to contribution, on the
other hand.
(c) ALLOCATION OF RELATIVE FAULT. Solely for purposes of determining
relative fault pursuant to this SECTION 4.07: (i) any fault associated with the
business conducted with Delayed Transfer Assets or Delayed Transfer Liabilities
(except for Xxxxxx'x xxxxx negligence or intentional misconduct) or with the
ownership, operation or activities of the Hospira Business prior to the
Effective Time (except with respect to Abbott Other Liabilities) shall be deemed
to be the fault of Hospira and the Hospira Subsidiaries and no such fault shall
be deemed to be the fault of Abbott or the Abbott Subsidiaries; and (ii) any
fault associated with the ownership, operation or activities of the Abbott
Business prior to the Effective Time shall be deemed to be the fault of Abbott
and the Abbott Subsidiaries and no such fault shall be deemed to be the fault of
Hospira or the Hospira Subsidiaries.
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(d) CONTRIBUTION PROCEDURES. The provisions of SECTIONS 4.04 through
4.11 shall govern any contribution claims.
SECTION 4.08. COVENANT NOT TO XXX. Each Party hereby covenants and
agrees that none of it, any of its Subsidiaries or any Person claiming through
it shall bring suit or otherwise assert any claim against any Indemnitee, or
assert a defense against any claim asserted by any Indemnitee, before any court,
arbitrator, neutral, mediator or administrative agency anywhere in the world,
alleging that: (a) the assumption of any Hospira Liabilities pursuant to the
Separation is void or unenforceable for any reason; or (b) the provisions of
this ARTICLE IV are void or unenforceable for any reason. The covenant in this
SECTION 4.08 shall run with title to the Hospira Assets and Hospira Liabilities,
and shall bind any transferee, assignee or other Person to whom an interest in
the Hospira Assets or Hospira Liabilities may be transferred or assigned.
SECTION 4.09. REMEDIES CUMULATIVE. The remedies provided in this
ARTICLE IV shall be cumulative and, subject to the provisions of SECTIONS
4.05(g) and 7.01, shall not preclude assertion by any Indemnitee of any other
rights or the seeking of all other remedies against any Indemnifying Party.
SECTION 4.10. INDUCEMENT. Hospira acknowledges and agrees that
Xxxxxx'x willingness to cause, effect and consumate the Separation and the
Distribution has been conditioned upon and induced by Hospira's covenants and
agreements in this Agreement and the Ancillary Agreements, including Hospira's
assumption of the Hospira Liabilities pursuant to the Separation and the
provisions of this Agreement and Hospira's covenants and agreements contained in
this ARTICLE IV.
SECTION 4.11. POST-EFFECTIVE TIME CONDUCT. The Parties acknowledge
that, after the Effective Time, each Party will be independent of the other
Party, with responsibility for its own actions and inactions and its own
Liabilities relating to, arising out of or resulting from the conduct of its
business following the Effective Time, except as may otherwise be provided in
any Principal Ancillary Agreement, and each Party shall (except as otherwise
provided in this ARTICLE IV, including SECTIONS 4.02 and 4.03) use commercially
reasonable efforts to prevent such Liabilities from being borne inappropriately
by the other Party.
ARTICLE V
CERTAIN OTHER MATTERS
SECTION 5.01. INSURANCE MATTERS.
(a) NO LIABILITY. Hospira does hereby, for itself and each of its
Subsidiaries, agree that none of Abbott, any Abbott Subsidiary or any Abbott
Indemnitee shall have any Liability whatsoever, and Hospira shall make no claim
or demand, or commence any Proceeding asserting any claim or demand, alleging
such Liability, as a result of the policies, practices and procedures regarding
insurance matters of Abbott or any Abbott Subsidiary as in effect at any time
prior to the Effective Time, including as a result of the limits or scope of any
insurance, the creditworthiness of any insurance carrier, the collectibility of
Insurance Proceeds, the terms and conditions of any policy, the handling or
disposition of any claims (including as set forth in
32
SCHEDULE 5.01), the adequacy or timeliness of any notice to any insurance
carrier with respect to any claim or potential claim or otherwise.
(b) TERMINATION OF INSURANCE CONTRACTS. Notwithstanding anything to
the contrary in SECTION 2.11, Abbott shall be permitted to terminate, cancel,
settle or commute any insurance contract which is a Mixed Contract.
(c) CERTAIN OPEN CLAIMS. The open claims described in SCHEDULE 5.01
shall be treated by the Parties in the matter set forth therein.
SECTION 5.02. CERTAIN BUSINESS MATTERS. Except as expressly provided
to the contrary in this Agreement or in any Principal Ancillary Agreement,
nothing in this Agreement or any Ancillary Agreement shall require either Party
or any of their respective Subsidiaries to refrain from: (a) engaging in the
same or similar activities or lines of business as the other Party or any of its
Subsidiaries; (b) doing business with any potential or actual supplier or
customer of the other Party or any of its Subsidiaries; or (c) engaging in, or
refraining from, any other activities whatsoever relating to any of the
potential or actual suppliers or customers of the other Party or any of its
Subsidiaries.
SECTION 5.03. LATE PAYMENTS. Except as provided in any Ancillary
Agreement, any amount not paid when due pursuant to this Agreement or any
Ancillary Agreement (and any amounts billed or otherwise invoiced or demanded
and properly payable that are not paid within 30 days of the date of such xxxx,
invoice or other demand) shall accrue interest at a rate per annum equal to the
Prime Rate plus 2%.
ARTICLE VI
EXCHANGE OF INFORMATION; CONFIDENTIALITY
SECTION 6.01. AGREEMENT FOR EXCHANGE OF INFORMATION.
(a) EXCHANGE OF INFORMATION. Each of Abbott and Hospira, on behalf of
itself and its Subsidiaries, shall provide, or cause to be provided, to the
other, at any time before or after the Effective Time, as soon as reasonably
practicable after written request therefor, any Information in its possession or
under its control to the extent that: (i) such Information relates to the
Hospira Business, or any Hospira Asset or Hospira Liability, if Hospira is the
requesting Party, or to the Abbott Business, or any Assets of Abbott (other than
the Hospira Assets) or Abbott Liability, if Abbott is the requesting Party; or
(ii) such Information is required by the requesting Party to comply with any
obligation imposed by any Governmental Authority; PROVIDED, HOWEVER, that in the
event that any Party determines that any such provision of Information could be
commercially detrimental, violate any law or agreement, or waive any
attorney-client privilege, the Parties shall use commercially reasonable efforts
to permit the compliance with such obligations in a manner that avoids any such
harm or consequence. The Party providing Information pursuant to this subsection
shall only be obligated to provide such Information in the form, condition and
format in which it then exists and in no event shall such Party be required to
perform any improvement, modification, conversion, updating or
33
reformatting of any such Information. The Parties acknowledge that the Tax
Sharing Agreement shall exclusively govern the exchange of Information with
respect to Taxes.
(b) COMPENSATION FOR PROVIDING INFORMATION. The Party requesting
Information agrees to reimburse the other Party for the reasonable costs, if
any, of creating, gathering, copying and transporting such Information. Except
as may be otherwise specifically provided elsewhere in this Agreement or in any
Ancillary Agreement, such costs shall be computed in accordance with the
providing Party's standard methodology and procedures.
SECTION 6.02. OWNERSHIP OF INFORMATION. The provision of any
Information pursuant to SECTION 6.01 shall not affect the ownership of such
Information (which shall be determined solely in accordance with the terms of
this Agreement and the Principal Ancillary Agreements), or constitute the grant
of rights of license in any such Information.
SECTION 6.03. RECORD RETENTION. To facilitate the possible exchange of
Information pursuant to this ARTICLE VI and other provisions of this Agreement
after the Effective Time, the Parties agree to use commercially reasonable
efforts to retain all Information in their respective possession or control as
of the Effective Time in accordance with the policies and procedures set forth
in SCHEDULES 1.01(n) and 6.03 and such other policies and retention schedules as
may be reasonably adopted by the relevant Party after the Effective Time that
are not inconsistent with SCHEDULE 6.03.
SECTION 6.04. LIMITATIONS OF LIABILITY. Neither Party shall have any
Liability to the other Party in the event that any Information exchanged or
provided pursuant to this Agreement is found to be inaccurate in the absence of
gross negligence or willful misconduct by the Party providing such Information.
Neither Party shall have any Liability to any other Party if any Information is
destroyed after commercially reasonable efforts by such Party to comply with the
provisions of this ARTICLE VI.
SECTION 6.05. OTHER AGREEMENTS PROVIDING FOR EXCHANGE OF INFORMATION.
The rights and obligations granted under this ARTICLE VI are subject to any
specific limitations, qualifications or additional provisions on the sharing,
exchange, retention or confidential treatment of Information set forth in any
Principal Ancillary Agreement.
SECTION 6.06. PRODUCTION OF WITNESSES; RECORDS; COOPERATION.
(a) AVAILABILITY OF WITNESSES AND INFORMATION. After the Effective
Time, except as provided on SCHEDULE 1.01(n) or in the case of a Proceeding by
one Party or any of its Subsidiaries against the other Party or any of its
Subsidiaries, each Party shall use commercially reasonable efforts to make
available to the other Party, upon written request, the former, current and
future directors, officers, employees, and agents of such Party or its
Subsidiaries as witnesses and any books, records or other documents within its
control or which it otherwise has the ability to make available, to the extent
that any such person (giving consideration to business and personal demands of
such directors, officers, employees, and agents) or books, records or other
documents may reasonably be required in connection with any Proceeding in which
the requesting Party may from time to time be involved that arises under this
Agreement or any Ancillary Agreement or otherwise arises out of or results
directly from actions, inactions, events,
34
omissions, conditions, facts or circumstances occurring or existing prior to the
Effective Time, regardless of whether such Proceeding is a matter with respect
to which indemnification may be sought hereunder. The requesting Party shall
bear all reasonable out of pocket costs and expenses in connection therewith.
(b) COOPERATION GENERALLY. Without limiting any provision of this
SECTION 6.06, the Parties shall cooperate and consult to the extent necessary or
advisable with respect to any Proceedings (other than a Proceeding by one Party
or any of its Subsidiaries against the other Party or any of its Subsidiaries)
that arise under this Agreement or any Ancillary Agreement or otherwise arise
out of or result directly from actions, inactions, events, omissions,
conditions, facts or circumstances occurring or existing prior to the Effective
Time.
(c) INFRINGEMENT CLAIMS. Each Party acknowledges, on its own behalf
and on behalf of its Subsidiaries, that it has no basis to believe that the
business or any act, product, technology, or service (including products,
technology or services currently under development) of the other Party
infringes, dilutes or misappropriates any intellectual property of a Third Party
or constitutes unfair competition or trade practices under the laws of any
jurisdiction and each Party will use commercially reasonable efforts to
cooperate with the other Party in connection with the defense of any Proceedings
asserting that any such infringement, dilution, misappropriation or unfair
competition or trade practices occurred prior to the Effective Time.
(d) BUSINESS CONFLICTS TO BE DISREGARDED. The obligation of the
Parties to provide witnesses pursuant to this Section is intended to be
interpreted in a manner so as to facilitate cooperation and shall include the
obligation to provide as witnesses inventors and other employees without regard
to whether the witness or the employer of the witness could assert a possible
business conflict (subject to the exception set forth in the first sentence of
subsection (a) above).
SECTION 6.07. CONFIDENTIALITY.
(a) CONFIDENTIALITY. Subject to SECTION 6.08, Abbott, on behalf of
itself and each Abbott Subsidiary, and Hospira, on behalf of itself and each
Hospira Subsidiary, agrees to hold, and to cause its respective directors,
officers, employees, agents, accountants, counsel and other advisors and
representatives to hold, in strict confidence, with at least the same degree of
care that applies to Xxxxxx'x confidential and proprietary information pursuant
to policies in effect as of the Effective Time, all Information concerning the
other (or its business) and the other's Subsidiaries (or their respective
businesses) that is either in its possession (including Information in its
possession prior to the Effective Time) or furnished by the other or the other's
Subsidiaries or their respective directors, officers, employees, agents,
accountants, counsel and other advisors and representatives at any time pursuant
to this Agreement or any Ancillary Agreement, and shall not use any such
Information other than for such purposes as may be expressly permitted hereunder
or thereunder, except, in each case, to the extent that such Information has
been: (i) in the public domain through no fault of such Party or its
Subsidiaries or any of their respective directors, officers, employees, agents,
accountants, counsel and other advisors and representatives; (ii) later lawfully
acquired from other sources by such Party (or any of its Subsidiaries) which
sources are not themselves bound by a confidentiality obligation; or (iii)
35
independently generated without reference to any proprietary or confidential
Information of the other Party.
(b) NO RELEASE; RETURN OR DESTRUCTION. Each Party agrees not to
release or disclose, or permit to be released or disclosed, any Information
addressed in SECTION 6.07(a) to any other Person, except its directors,
officers, employees, agents, accountants, counsel and other advisors and
representatives who need to know such Information, and except in compliance with
SECTION 6.08 and SCHEDULE 1.01(n). Without limiting the foregoing, when any
Information furnished by the other Party after the Effective Time pursuant to
this Agreement or any Ancillary Agreement is no longer needed for the purposes
contemplated by this Agreement or any Ancillary Agreement, each Party shall, at
such Party's option, promptly after receiving a written request from the other
Party either return to the other Party all such Information in a tangible form
(including all copies thereof and all notes, extracts or summaries based
thereon) or certify to the other Party that it has destroyed such Information
(and such copies thereof and such notes, extracts or summaries based thereon).
SECTION 6.08. PROTECTIVE ARRANGEMENTS. In the event that either Party
or any of its Subsidiaries either determines on the advice of its counsel that
it is required to disclose any Information pursuant to applicable law or the
rules or regulations of any Governmental Authority or receives any demand under
lawful process or from any Governmental Authority to disclose or provide
Information of the other Party that is subject to the confidentiality provisions
hereof, such Party shall notify the other Party prior to disclosing or providing
such Information and shall cooperate at the expense of the requesting Party in
seeking any reasonable protective arrangements requested by such other Party.
Subject to the foregoing, the Party that received such request, or its
Subsidiaries, may thereafter disclose or provide Information to the extent
required by such law (as so advised by counsel) or by lawful process or such
Governmental Authority.
ARTICLE VII
DISPUTE RESOLUTION
SECTION 7.01. DISPUTES.
(a) ALTERNATIVE DISPUTE RESOLUTION PROCEDURES. The Parties acknowledge
that, from time to time after the Effective Time, a controversy, dispute or
claim may arise relating to either Party's rights or obligations under this
Agreement. The Parties agree that any such controversy, dispute or claim
(whether arising in contract, tort or otherwise) arising out of or relating in
any way to this Agreement (including regarding whether any Assets are Hospira
Assets, any Liabilities are Hospira Liabilities or the interpretation or
validity of this Agreement) shall be resolved by the Alternative Dispute
Resolution ("ADR") provisions set forth in this SECTION 7.01 and in SCHEDULE
7.01, the result of which shall be binding upon the Parties.
(i) NOTICE. Prior to initiating an ADR proceeding, a Party first must
send written notice to the other Party in accordance with the provisions of
SECTION 9.05 describing the dispute and requesting attempted resolution by
good faith negotiations. Good faith
36
negotiations shall be conducted in two stages, with the second stage being
triggered only if first stage negotiations do not result in a resolution of
the dispute.
(ii) FIRST STAGE NEGOTIATIONS. Following receipt of the written notice
described in the preceding paragraph, the respective CEOs or Presidents of
the Parties shall designate a group of no more than three individuals,
exclusive of counsel, to participate in good faith negotiations aimed at
resolving the dispute. Within 21 days from receipt of the written notice,
the respective groups shall meet in person to conduct good faith
negotiations. By mutual written consent, the Parties may extend the 21-day
period for conducting first stage negotiations. If the Parties fail to meet
within the 21-day period or the Parties fail to resolve the dispute during
such period, and the period is not extended by mutual written agreement,
the Parties shall engage in second stage negotiations as described in the
next paragraph.
(iii) SECOND STAGE NEGOTIATIONS. Following the expiration of the
21-day period described in the preceding paragraph, or any extension
thereof mutually agreed to in writing, if the Parties are unable to resolve
the dispute, they shall engage in second stage negotiations between the
respective CEOs or Presidents (or their designees) of the Parties. If the
dispute has not been resolved within 14 days following the conclusion of
first stage negotiations, either Party may initiate an ADR proceeding as
provided in SCHEDULE 7.01. The Parties shall have the right to be
represented by counsel in such a proceeding.
(b) CONTINUATION OF SERVICES AND COMMITMENTS. Unless otherwise agreed
in writing, the Parties shall, and shall cause their respective Subsidiaries to,
continue to provide services and honor all other commitments under this
Agreement and each Ancillary Agreement during the course of dispute resolution
pursuant to the provisions of this ARTICLE VII with respect to all matters
subject to such dispute, controversy or claim.
ARTICLE VIII
TERMINATION
SECTION 8.01. TERMINATION. This Agreement and all Ancillary Agreements
may be terminated and the Distribution may be amended, modified or abandoned at
any time prior to the Effective Time by and in the sole discretion of Abbott
without the approval of Hospira. In the event of such termination, neither Party
shall have any Liability of any kind to the other Party. After the Effective
Time, this Agreement may not be terminated except by an agreement in writing
signed by the Parties.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. COUNTERPARTS; ENTIRE AGREEMENT; CORPORATE POWER;
FACSIMILE SIGNATURES.
37
(a) COUNTERPARTS. This Agreement and each Ancillary Agreement may be
executed in one or more counterparts, all of which shall be considered one and
the same agreement.
(b) ENTIRE AGREEMENT. This Agreement, the Ancillary Agreements and the
exhibits, schedules and annexes hereto and thereto contain the entire agreement
between the Parties with respect to the subject matter hereof, supersede all
previous agreements, negotiations, discussions, writings, understandings,
commitments and conversations with respect to such subject matter and there are
no agreements or understandings between the Parties other than those set forth
or referred to herein or therein. Notwithstanding any other provisions in this
Agreement to the contrary, in the event and to the extent that there is a
conflict between the provisions of this Agreement and the provisions of any
Principal Ancillary Agreement, the provisions of such Principal Ancillary
Agreement shall control.
(c) CORPORATE POWER. Abbott represents on behalf of itself and, to the
extent applicable, each Abbott Subsidiary and Hospira represents on behalf of
itself and, to the extent applicable, each Hospira Subsidiary as follows:
(i) each such Person has the requisite corporate or other power and
authority and has taken all corporate or other action necessary in order to
execute, deliver and perform this Agreement and each Principal Ancillary
Agreement to which it is a party and to consummate the transactions
contemplated hereby and thereby; and
(ii) this Agreement and each Principal Ancillary Agreement to which it
is a party has been duly executed and delivered by it and constitutes a
valid and binding agreement of it enforceable in accordance with the terms
thereof.
(d) FACSIMILE SIGNATURES. Each Party acknowledges that it and the
other Party may execute certain of the Ancillary Agreements by facsimile, stamp
or mechanical signature. Each Party expressly adopts and confirms each such
facsimile, stamp or mechanical signature made in its respective name as if it
were a manual signature, agrees that it shall not assert that any such signature
is not adequate to bind such Party to the same extent as if it were signed
manually and agrees that at the reasonable request of the other Party at any
time it shall as promptly as reasonably practicable cause each such Ancillary
Agreement to be manually executed (any such execution to be as of the date of
the initial date thereof).
SECTION 9.02. GOVERNING LAW. This Agreement and, unless expressly
provided therein, each Ancillary Agreement, shall be governed by and construed
and interpreted in accordance with the laws of the State of Illinois
irrespective of the choice of laws principles of the State of Illinois, as to
all matters, including matters of validity, construction, effect,
enforceability, performance and remedies.
SECTION 9.03. ASSIGNABILITY. Except as set forth in any Ancillary
Agreement, this Agreement and each Ancillary Agreement shall be binding upon and
inure to the benefit of the Parties and the parties thereto, respectively, and
their respective successors and permitted assigns; PROVIDED, HOWEVER, that
neither Party nor any party thereto may assign its rights or delegate its
obligations under this Agreement or any Ancillary Agreement without the express
38
prior written consent of the other Party hereto or the other parties thereto.
Notwithstanding the foregoing, this Agreement and the Ancillary Agreements
(except as may be otherwise provided in any such Ancillary Agreement) shall be
assignable in whole in connection with a merger or consolidation or the sale of
all or substantially all of the Assets of a Party so long as the resulting,
surviving or transferee Person assumes all the obligations of the relevant party
thereto by operation of law or pursuant to an agreement in form and substance
reasonably satisfactory to the other Party.
SECTION 9.04. THIRD PARTY BENEFICIARIES. Except for the
indemnification rights under this Agreement of any Abbott Indemnitee or Hospira
Indemnitee in their respective capacities as such and for the releases under
SECTION 4.01 of any Person provided therein: (a) the provisions of this
Agreement and each Ancillary Agreement are solely for the benefit of the Parties
and their respective Subsidiaries, after giving effect to the Distribution, and
are not intended to confer upon any Person except the Parties and their
respective Subsidiaries, after giving effect to the Distribution, any rights or
remedies hereunder; and (b) there are no other third party beneficiaries of this
Agreement or any Ancillary Agreement and neither this Agreement nor any
Ancillary Agreement shall provide any other Third Party with any remedy, claim,
liability, reimbursement, claim of action or other right in excess of those
existing without reference to this Agreement or any Ancillary Agreement.
SECTION 9.05. NOTICES. All notices or other communications under this
Agreement or any Ancillary Agreement (except as otherwise provided therein) must
be in writing and shall be deemed to be duly given: (a) when delivered in
person; (b) upon transmission via confirmed facsimile transmission, provided
that such transmission is followed by delivery of a physical copy thereof in
person, via U.S. first class mail, or via a private express mail courier; or (c)
two days after deposit with a private express mail courier, in any such case
addressed as follows:
If to Abbott, to:
Xxxxxx Laboratories
000 Xxxxxx Xxxx Xxxx
Xxxxxxxx XX0X, Xxxx. 364
Xxxxxx Park, Illinois 60064-6020
Attn: General Counsel
Facsimile: (000) 000-0000
If to Hospira to:
Hospira, Inc.
Legal Department
Dept. NLEG
000 Xxxxx Xxxxx Xxxxx
X.X. Xxx 0000
Xxxx Xxxxxx, XX 00000-0000
Attn: General Counsel
Facsimile: (000) 000-0000
39
Any Party may, by notice to the other Party, change the address to which
such notices are to be given.
SECTION 9.06. SEVERABILITY. If any provision of this Agreement or any
Ancillary Agreement or the application thereof to any Person or circumstance is
determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions hereof or thereof, or the application of
such provision to Persons or circumstances or in jurisdictions other than those
as to which it has been held invalid or unenforceable, shall remain in full
force and effect and shall in no way be affected, impaired or invalidated
thereby, so long as the economic or legal substance of the transactions
contemplated hereby or thereby, as the case may be, is not affected in any
manner adverse to any Party. Upon such determination, the Parties shall
negotiate in good faith in an effort to agree upon a suitable and equitable
provision to effect the original intent of the Parties.
SECTION 9.07. FORCE MAJEURE. Neither Party shall be deemed in default
of this Agreement or any Ancillary Agreement to the extent that any delay or
failure in the performance of its obligations under this Agreement or any
Ancillary Agreement results from any cause beyond its reasonable control and
without its fault or negligence, such as acts of God, acts of Governmental
Authority, embargoes, epidemics, war, riots, insurrections, acts of terrorism,
fires, explosions, earthquakes, floods, unusually severe weather conditions,
labor problems or unavailability of parts, or, in the case of computer systems,
any failure in electrical or air conditioning equipment. In the event of any
such excused delay, the time for performance shall be extended for a period
equal to the time lost by reason of the delay.
SECTION 9.08. RESPONSIBILITY FOR EXPENSES.
(a) EXPENSES INCURRED ON OR PRIOR TO THE EFFECTIVE TIME. Except as
otherwise expressly set forth in this Agreement or any Principal Ancillary
Agreement, all costs and expenses incurred on or prior to the Effective Time in
connection with the preparation, execution, delivery and implementation of this
Agreement and any Ancillary Agreement, the Separation, the Registration
Statement and the Distribution and the consummation of the transaction
contemplated hereby and thereby shall be charged to and paid by Abbott.
(b) EXPENSES INCURRED OR ACCRUED AFTER THE EFFECTIVE TIME. Except as
otherwise expressly set forth in this Agreement or any Principal Ancillary
Agreement, each Party shall bear its own costs and expenses incurred or accrued
after the Effective Time.
SECTION 9.09. HEADINGS. The article, section and paragraph headings
contained in this Agreement and in the Ancillary Agreements are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement or any Ancillary Agreement.
SECTION 9.10. SURVIVAL OF COVENANTS. Except as expressly set forth in
any Principal Ancillary Agreement, the covenants, releases, indemnities,
representations and warranties contained in this Agreement and each Ancillary
Agreement, and liability for the
40
breach of any obligations contained herein or therein, shall survive the
Effective Time and shall remain in full force and effect thereafter.
SECTION 9.11. SUBSIDIARIES. Abbott shall cause to be performed, and
hereby guarantees the performance of, all actions, agreements and obligations
set forth herein to be performed by any Abbott Subsidiary and Hospira shall
cause to be performed, and hereby guarantees the performance of, all actions,
agreements and obligations set forth herein to be performed by any Hospira
Subsidiary.
SECTION 9.12. WAIVERS OF DEFAULT. Waiver by either Party of any
default by the other Party of any provision of this Agreement or any Ancillary
Agreement shall not be deemed a waiver by the waiving Party of any subsequent or
other default, nor shall it prejudice the rights of the other Party.
SECTION 9.13. AMENDMENTS. No provisions of this Agreement or any
Ancillary Agreement shall be deemed amended, supplemented or modified unless
such amendment, supplement or modification is in writing and signed by an
authorized representative of both Parties. No provisions of this Agreement or
any Ancillary Agreement shall be deemed waived unless such waiver is in writing
and signed by the authorized representative of the Party against whom it is
sought to be enforced.
SECTION 9.14. INTERPRETATION. Words in the singular shall be deemed to
include the plural and vice versa and words of one gender shall be deemed to
include the other genders as the context requires. The terms "hereof," "herein,"
and "herewith" and words of similar import shall, unless otherwise stated, be
construed to refer to this Agreement as a whole (including all of the Schedules
and Exhibits hereto and thereto) and not to any particular provision of this
Agreement. Article, Section, Exhibit and Schedule references are to the
Articles, Sections, Exhibits, and Schedules to this Agreement unless otherwise
specified. Unless otherwise stated, all references to any agreement shall be
deemed to include the exhibits, schedules and annexes to such agreement. The
word "including" and words of similar import when used in this Agreement shall
mean "including, without limitation," unless the context otherwise requires or
unless otherwise specified. The word "or" shall not be exclusive. Unless
otherwise specified in a particular case, the word "days" refers to calendar
days. References herein to this Agreement or any Ancillary Agreement shall be
deemed to refer to this Agreement or such Ancillary Agreement as of the
Effective Time and as it may be amended thereafter, unless otherwise specified.
References to the performance, discharge or fulfillment of any Liability in
accordance with its terms shall have meaning only to the extent such Liability
has terms; if the Liability does not have terms, the reference shall mean
performance, discharge or fulfillment of such Liability.
SECTION 9.15. ADVISORS. Abbott may select any investment banker(s) and
manager(s) in connection with the Distribution, as well as any financial
printer, information or exchange agent and outside counsel for Abbott, which may
include Mayer, Brown, Xxxx & Maw LLP, Xxxxx & XxXxxxxx and XxXxxxxxx, Will &
Xxxxx. Hospira acknowledges, for itself and each Hospira Subsidiary, that Mayer,
Brown, Xxxx & Maw LLP, Xxxxx & XxXxxxxx and XxXxxxxxx, Will & Xxxxx have acted
only in the capacity as counsel to Abbott, and not as counsel to Hospira or any
Hospira Subsidiary, in connection with this Agreement and the
41
Ancillary Agreements and the documents and transactions contemplated herein or
therein (other than in connection with the Financing Agreements and any other
arrangements providing financing to Hospira, with respect to which such firms
may act as counsel to both Abbott and Hospira).
SECTION 9.16. MUTUAL DRAFTING. This Agreement and the Ancillary
Agreements shall be deemed to be the joint work product of the Parties and any
rule of construction that a document shall be interpreted or construed against a
drafter of such document shall not be applicable.
* * * * *
42
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their duly authorized representatives.
XXXXXX LABORATORIES
By:
-------------------------------
Name:
Title:
HOSPIRA, INC.
By:
-------------------------------
Name:
Title:
43
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS.................................................................................1
SECTION 1.01. Definitions..........................................................................1
ARTICLE II THE SEPARATION.............................................................................14
SECTION 2.01. Formation of Hospira................................................................14
(a) Incorporation of Hospira................................................................15
(b) Adoption of Hospira's Charter and Bylaws................................................15
(c) Adoption of Hospira's Rights Plan.......................................................15
(d) Hospira's Directors and Officers........................................................15
(e) NYSE Listing............................................................................15
SECTION 2.02. The Separation Transactions.........................................................15
(a) Separation of Ex-U.S. Manufacturing Operations..........................................15
(b) Contribution of Certain ALI Assets and Liabilities to HWI...............................15
(c) Distribution of HWI Shares by ALI to Abbott.............................................15
(d) AIL's Conversion to an LLC and Distribution of Certain Assets and Liabilities...........16
(e) Contribution of Hospira Assets and Liabilities..........................................16
SECTION 2.03. Delayed U.S./Ex-U.S. Manufacturing Assets and Liabilities...........................16
(a) Administration of the Assets and Liabilities...........................................16
(b) Transfer of the Assets and Liabilities.................................................17
(c) Hospira Proceeding Liabilities.........................................................17
SECTION 2.04. Delayed Ex-U.S. Commercial Assets and Liabilities and Local Closings................17
SECTION 2.05. Ancillary Agreements................................................................17
SECTION 2.06. Disclaimer of Representations and Warranties........................................17
SECTION 2.07. Financing Arrangements..............................................................18
SECTION 2.08. Termination of Agreements...........................................................18
(a) Termination of Agreements between Abbott and Hospira....................................18
(b) Exceptions..............................................................................18
SECTION 2.09. Settlement of Accounts Between Abbott and Hospira...................................19
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SECTION 2.10. Novation of Hospira Liabilities.....................................................19
SECTION 2.11. Mixed Contracts; Mixed Accounts.....................................................19
(a) Mixed Contracts.........................................................................19
(b) Mixed Accounts..........................................................................20
(c) No Payments.............................................................................20
SECTION 2.12. Further Assurances..................................................................20
(a) Additional Actions......................................................................20
(b) Cooperation.............................................................................20
(c) Misallocations..........................................................................21
SECTION 2.13. Clarification of Intent.............................................................21
SECTION 2.14. Transition Committee................................................................21
SECTION 2.15. Accounting for Deferred Taxes.......................................................21
ARTICLE III THE DISTRIBUTION........................................................................22
SECTION 3.01. Actions Prior to the Distribution...................................................22
(a) Notice to NYSE..........................................................................22
(b) Securities Law Matters..................................................................22
(c) Mailing of Information Statement........................................................22
(d) Satisfying Conditions to Distribution...................................................22
SECTION 3.02. The Distribution....................................................................22
(a) Delivery of Share Certificates..........................................................22
(b) Distribution of Shares and Cash.........................................................22
SECTION 3.03. Fractional Shares; Unclaimed Shares.................................................23
(a) No Fractional Shares....................................................................23
(b) Beneficial Owners.......................................................................23
(c) Unclaimed Stock or Cash.................................................................23
SECTION 3.04. Sole Discretion of Abbott...........................................................23
SECTION 3.05. Conditions to the Separation and the Distribution...................................23
(a) The Conditions..........................................................................23
(b) Conditions for Benefit of Abbott........................................................25
ARTICLE IV MUTUAL RELEASES; INDEMNIFICATION...........................................................25
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SECTION 4.01. Releases............................................................................25
(a) Hospira Release of Abbott...............................................................25
(b) Abbott Release of Hospira...............................................................26
(c) Abbott Obligations Not Affected.........................................................26
(d) No Hospira Claims.......................................................................27
(e) No Abbott Claims........................................................................27
(f) Subsidiary Releases.....................................................................27
SECTION 4.02. Indemnification By Hospira..........................................................27
SECTION 4.03. Indemnification By Abbott...........................................................27
SECTION 4.04. Indemnification Obligations Net of Insurance Proceeds and Other Amounts.............27
(a) Insurance Proceeds and Other Amounts....................................................27
(b) Insurers and Other Third Parties Not Relieved...........................................28
SECTION 4.05. Procedures For Indemnification of Third Party Claims................................28
(a) Notice of Claims........................................................................28
(b) Control of Defense......................................................................28
(c) Allocation of Defense Costs.............................................................29
(d) Right to Monitor and Participate........................................................29
(e) No Settlement...........................................................................29
(f) Pending Third Party Claims..............................................................29
(g) Allocation of Proceeding Liabilities....................................................30
SECTION 4.06. Additional Matters..................................................................30
(a) Notice of Claims........................................................................30
(b) Subrogation.............................................................................30
(c) Pursuit of Claims Against Third Parties.................................................30
(d) Directors and Officers Insurance........................................................30
(e) Currency Conversion.....................................................................31
SECTION 4.07. Right of Contribution...............................................................31
(a) Contribution by Hospira.................................................................31
(b) Contribution by Abbott..................................................................31
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(c) Allocation of Relative Fault............................................................31
(d) Contribution Procedures.................................................................32
SECTION 4.08. Covenant Not to Xxx.................................................................32
SECTION 4.09. Remedies Cumulative.................................................................32
SECTION 4.10. Inducement..........................................................................32
SECTION 4.11. Post-Effective Time Conduct.........................................................32
ARTICLE V CERTAIN OTHER MATTERS......................................................................32
SECTION 5.01. Insurance Matters...................................................................32
(a) No Liability............................................................................32
(b) Termination of Insurance Contracts......................................................33
(c) Certain Open Claims.....................................................................33
SECTION 5.02. Certain Business Matters............................................................33
SECTION 5.03. Late Payments.......................................................................33
ARTICLE VI EXCHANGE OF INFORMATION; CONFIDENTIALITY...................................................33
SECTION 6.01. Agreement For Exchange of Information...............................................33
(a) Exchange of Information.................................................................33
(b) Compensation for Providing Information..................................................34
SECTION 6.02. Ownership of Information............................................................34
SECTION 6.03. Record Retention....................................................................34
SECTION 6.04. Limitations of Liability............................................................34
SECTION 6.05. Other Agreements Providing For Exchange of Information..............................34
SECTION 6.06. Production of Witnesses; Records; Cooperation.......................................34
(a) Availability of Witnesses and Information...............................................34
(b) Cooperation Generally...................................................................35
(c) Infringement Claims.....................................................................35
(d) Business Conflicts to be Disregarded....................................................35
SECTION 6.07. Confidentiality.....................................................................35
(a) Confidentiality.........................................................................35
(b) No Release; Return or Destruction.......................................................36
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SECTION 6.08. Protective Arrangements.............................................................36
ARTICLE VII DISPUTE RESOLUTION.........................................................................36
SECTION 7.01. Disputes............................................................................36
(a) Alternative Dispute Resolution Procedures...............................................36
(b) Continuation of Services and Commitments................................................37
ARTICLE VIII TERMINATION................................................................................37
SECTION 8.01. Termination.........................................................................37
ARTICLE IX MISCELLANEOUS..............................................................................37
SECTION 9.01. Counterparts; Entire Agreement; Corporate Power; Facsimile Signatures...............37
(a) Counterparts............................................................................38
(b) Entire Agreement........................................................................38
(c) Corporate Power.........................................................................38
(d) Facsimile Signatures....................................................................38
SECTION 9.02. Governing Law.......................................................................38
SECTION 9.03. Assignability.......................................................................38
SECTION 9.04. Third Party Beneficiaries...........................................................39
SECTION 9.05. Notices.............................................................................39
SECTION 9.06. Severability........................................................................40
SECTION 9.07. Force Majeure.......................................................................40
SECTION 9.08. Responsibility For Expenses.........................................................40
(a) Expenses Incurred on or Prior to the Effective Time.....................................40
(b) Expenses Incurred or Accrued after the Effective Time...................................40
SECTION 9.09. Headings............................................................................40
SECTION 9.10. Survival of Covenants...............................................................40
SECTION 9.11. Subsidiaries........................................................................41
SECTION 9.12. Waivers of Default..................................................................41
SECTION 9.13. Amendments..........................................................................41
SECTION 9.14. Interpretation......................................................................41
SECTION 9.15. Advisors............................................................................41
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SECTION 9.16. Mutual Drafting.....................................................................42
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