Exhibit 10.1
DISTRIBUTION AGREEMENT
BY AND BETWEEN
XXXXXX COMMUNICATIONS, INC.,
A DELAWARE CORPORATION
AND
VENTIV HEALTH, INC.,
A DELAWARE CORPORATION
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS......................................................1
1.01 General............................................................1
1.02 References to Time................................................10
ARTICLE II CERTAIN TRANSACTIONS PRIOR TO THE DISTRIBUTION DATE.............10
2.01 Certificate of Incorporation; By-laws.............................10
2.02 Issuance of Stock.................................................10
2.03 Transfer of Assets and Assumption of Liabilities..................10
2.04 Conduct of Business Pending the Distribution Date.................10
2.05 Refinancing.......................................................10
2.06 Registration and Listing..........................................11
ARTICLE III THE DISTRIBUTION................................................11
3.01 Record Date and Distribution Date.................................11
3.02 The Agent.........................................................11
3.03 Delivery of Share Certificates to the Agent.......................11
3.04 Distribution......................................................12
3.05 Payment In Lieu of Fractional Shares..............................12
ARTICLE IV SURVIVAL, ASSUMPTION AND INDEMNIFICATION........................12
4.01 Survival of Agreements............................................12
4.02 Taxes and Employee-Related Assets and Liabilities.................12
4.03 Assumption and Indemnification....................................12
4.04 Procedure for Indemnification.....................................15
4.05 Remedies Cumulative...............................................16
ARTICLE V CERTAIN ADDITIONAL COVENANTS....................................16
5.01 Further Assurances................................................16
5.02 Ventiv Board of Directors.........................................17
5.03 Continuing Contractual Arrangements...............................17
5.04 Intercompany Accounts.............................................17
5.05 Cash Accounts.....................................................17
5.06 Other Agreements..................................................17
5.07 Transfer Taxes....................................................17
5.08 Healthcare Services Support Agreements............................18
ARTICLE VI ACCESS TO INFORMATION...........................................18
6.01 Provision of Corporate Records....................................18
6.02 Access to Information.............................................18
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TABLE OF CONTENTS
(continued)
Page
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6.03 Production of Witnesses...........................................18
6.04 Retention of Records..............................................19
6.05 Confidentiality...................................................19
ARTICLE VII EMPLOYEE BENEFITS...............................................19
7.01 Qualified Plans...................................................19
7.02 [Intentionally Omitted]...........................................22
7.03 Welfare Plans.....................................................22
7.04 [Intentionally Omitted]...........................................22
7.05 [Intentionally Omitted]...........................................22
7.06 Severance Pay.....................................................23
7.07 [Intentionally Omitted]...........................................23
7.08 Post-Distribution Liabilities.....................................23
7.09 Other Balance Sheet Adjustments...................................23
7.10 Preservation of Rights to Amend or Terminate Plans................23
7.11 Reimbursement; Indemnification....................................24
7.12 Further Transfers.................................................24
7.13 Officers and Employees............................................24
7.14 Employment Agreements.............................................25
7.15 Other Liabilities.................................................25
7.16 Compliance........................................................25
ARTICLE VIII NO REPRESENTATIONS OR WARRANTIES; EXCEPTIONS....................25
8.01 No Representations or Warranties; Exceptions......................25
ARTICLE IX INSURANCE.......................................................26
9.01 Insurance Policies and Rights Included Within Healthcare
Services Assets...................................................26
9.02 Post-Distribution Date Claims.....................................26
9.03 Administration and Reserves.......................................26
9.04 Insurance Premiums................................................27
9.05 Allocation of Insurance Proceeds; Cooperation.....................27
9.06 Reimbursement of Expenses.........................................27
9.07 Insurer Insolvency................................................28
9.08 Letters of Credit.................................................28
9.09 No Reduction of Coverage..........................................28
9.10 Future Insurance Coverage.........................................28
9.11 Assistance, Waiver of Conflict and Shared Defense.................28
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TABLE OF CONTENTS
(continued)
Page
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ARTICLE X MISCELLANEOUS...................................................28
10.01 Conditions to Obligations.........................................28
10.02 Complete Agreement................................................30
10.03 Expenses..........................................................30
10.04 Governing Law.....................................................30
10.05 Notices...........................................................30
10.06 Amendment and Modification........................................31
10.07 Successors and Assigns; No Third-Party Beneficiaries..............31
10.08 Counterparts......................................................31
10.09 Interpretation....................................................31
10.10 Legal Enforceability..............................................31
10.11 References; Construction..........................................32
10.12 Termination.......................................................32
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DISTRIBUTION AGREEMENT
----------------------
This DISTRIBUTION AGREEMENT, dated as of September __, 1999, between Xxxxxx
Communications, Inc., a Delaware corporation ("Xxxxxx") and Ventiv Health, Inc.
(formerly known as Xxxxxx Healthcare Services, Inc.), a newly formed Delaware
corporation which is a wholly-owned subsidiary of Xxxxxx ("Ventiv").
W I T N E S S E T H:
WHEREAS, the Boards of Directors of Xxxxxx and Ventiv have determined that
it is appropriate and desirable: (i) to consolidate into Ventiv certain of the
businesses currently conducted by Xxxxxx directly and through certain of its
subsidiaries; and (ii) to distribute to the holders of the issued and
outstanding shares of common stock, par value $0.001 per share, of Xxxxxx all of
the issued and outstanding shares of common stock, par value $0.001 per share,
of Ventiv in accordance with Article III hereof (the "Distribution");
WHEREAS, the Distribution is intended to qualify as a tax-free spinoff
under Section 355 of the Internal Revenue Code of 1986, as amended; and
WHEREAS, the parties hereto have determined that it is necessary and
desirable to set forth the principal corporate transactions required to effect
the Distribution and to set forth other agreements that will govern certain
other matters prior to or following the Distribution;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained and intending to be legally bound thereby, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
1.01 GENERAL. As used in this Agreement, the following terms shall have
the following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
Affiliate: with respect to any specified Person, a Person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person;
provided, however, that for purposes of this Agreement, no member of either
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Group shall be deemed to be an Affiliate of any member of the other Group.
Agent: American Stock Transfer and Trust Company.
Asset: any and all assets and properties, tangible or intangible,
including the following: (1) cash, notes and accounts receivable (whether
current or non-current); (2) certificates of deposit, banker's acceptances,
stock, debentures, evidences of indebtedness, certificates of interest or
participation in profit-sharing agreements, collateral-trust certificates,
preorganization certificates or subscriptions, transferable shares,
investment contracts, voting-trust certificates, fractional undivided
interests in oil, gas or other mineral rights, puts, calls, straddles,
options and other securities of any kind; (3) trade secrets, confidential
information, registered and nonregistered trademarks, service marks,
service names, trade styles and trade names, product bar codes and
associated goodwill; statutory, common law and registered copyrights;
applications for any of the foregoing, rights to use the foregoing and
other rights in, to and under the foregoing; (4) rights under leases,
contracts, licenses, permits, distribution arrangements, sales and purchase
agreements, other agreements and business arrangements; (5) real estate and
buildings and other improvements thereon; (6) leasehold improvements,
fixtures, trade fixtures, machinery, equipment (including transportation
and office equipment), tools and furniture; (7) office supplies, production
supplies, spare parts, other miscellaneous supplies and other tangible
property of any kind; (8) raw materials, work-in-process, finished goods,
consigned goods and other inventories; (9) prepayments or prepaid expenses;
(10) claims, causes of action, choses in action, rights of recovery and
rights of set-off of any kind; (11) the right to receive mail, payments on
accounts receivable and other communications; (12) lists of advertisers,
records pertaining to advertisers and accounts, personnel records, lists
and records pertaining to suppliers and agents, and books, ledgers, files
and business records of every kind; (13) advertising materials and other
printed or written materials; (14) goodwill as a going concern and other
intangible properties; (15) employee contracts, including any rights
thereunder to restrict an employee from competing in certain respects; and
(16) licenses and authorizations issued by any governmental authority.
Business Day: any day other than a Saturday, a Sunday or a day on
which banking institutions located in the States of Maryland, New York or
Delaware are authorized or obligated by law or executive order to close.
Claims Administration: the processing of claims made under the
Insurance Policies, including the reporting of claims to the insurance
carrier, management and defense of claims and providing for appropriate
releases upon settlement of claims.
Code: the Internal Revenue Code of 1986, as amended, or any successor
legislation and the regulations promulgated thereunder.
Current Plan Year: the plan year or fiscal year, to the extent
applicable with respect to any Plan, during which the Distribution Date
occurs.
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Cut-Off Date: the last day of the calendar month immediately
preceding the Distribution Date or, if such day is less than fourteen (14)
days before the Distribution Date, the last day of the next preceding
calendar month.
DGCL: the Delaware General Corporation Law.
Disclosure Document: the Registration Statement on Form 10 and the
related Information Statement.
Distribution: the distribution to holders of shares of Xxxxxx Common
Stock to be effected pursuant to Article III on the basis of one share of
Ventiv Common Stock for every three shares of Xxxxxx Common Stock held of
record as of the Record Date.
Distribution Date: the date, to be determined by the Board of
Directors of Xxxxxx as of which the Distribution shall be effected.
ERISA: the Employee Retirement Income Security Act of 1974, as
amended, or any successor legislation, and any regulations promulgated
thereunder.
Exchange Act: the Securities Exchange Act of 1934, as amended,
together with the rules and regulations promulgated thereunder.
Final Date: the fifteenth (15th) Business Day after the Distribution
Date.
Foreign Exchange Rate: with respect to any currency other than United
States dollars as of any date, the average of the opening bid and asked
rates on such date at which such currency may be exchanged for United
States dollars as quoted by Citibank, N.A., except that, with respect to
any Indemnifiable Loss covered by insurance, the Foreign Exchange Rate for
such currency shall be determined as set forth in Section 4.03(e)(2).
Former Xxxxxx Businesses: all of the businesses and operations (1)
heretofore but not currently conducted by any member of the Xxxxxx Group,
or (2) currently or heretofore conducted by any former Subsidiary of any
such member.
Gains Tax: the applicable state and local income taxes related to any
gains from the transfer of any real property constituting Healthcare
Services Assets.
Group: the Xxxxxx Group or the Healthcare Services Group.
Healthcare Services Assets: subject to the provisions of the Other
Agreements, (1) all of the Assets held by any member of either Group
immediately prior to the Distribution Date, which Assets are used primarily
in,
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held for use primarily in, or necessary for, the operation of the
Healthcare Services Business, (2) all of the outstanding shares of all
classes of capital stock of the Healthcare Services Subsidiaries and (3)
all of the Assets listed on Schedule 1.01(b)(i).
Healthcare Services Business: all of the businesses conducted
immediately prior to the Distribution Date by any member of either Group
and reported by Xxxxxx in the "Healthcare Services" segment in the
footnotes to the Xxxxxx consolidated financial statements (or which would
have been so reported had it been conducted as of December 31, 1998) in the
Annual Report on Form 10-K for the year ended December 31, 1998.
Healthcare Services Claim: any claim against any Healthcare Services
Employee, Healthcare Services Individual or member of the Healthcare
Services Group with respect to any injury, loss, Liability, damage or
expense that (1) is or was incurred or asserted to have been incurred prior
to the Distribution Date in, or in connection with, the conduct of the
Xxxxxx Assets, the Healthcare Services Assets, the Xxxxxx Business or the
Healthcare Services Business, and (2) arose or may have arisen out of one
or more occurrence or events that are or may be insured or insurable under
one or more of the Xxxxxx Policies.
Healthcare Services Director: any individual who is a director of
Ventiv.
Healthcare Services Employee: any individual who (1) immediately
prior to the Distribution Date is an officer or employee of any member of
either Group and (A) is primarily employed in the Healthcare Services
Business, or (B) will be an employee of the Healthcare Services Group
immediately following the Distribution, or (2) immediately prior to the
Distribution Date is not an officer or employee of any member of either
Group but at any time prior to the Distribution Date was an officer or
employee of any member of either Group and throughout such period was
primarily employed in the Healthcare Services Business.
Healthcare Services Free-Standing Qualified Plans: the plans listed
in Schedule 7.01 hereto.
Healthcare Services Group: Ventiv and the Healthcare Services
Subsidiaries.
Healthcare Services Individual: any individual who (1) is a
Healthcare Services Employee or (2) is a beneficiary of any individual
specified in clause (1) above.
Healthcare Services Liabilities: subject to the provisions of the
Other Agreements, all of the Liabilities of any member of either Group (1)
which relate directly to the Healthcare Services Assets or the Healthcare
Services Business as conducted immediately prior to the Distribution Date,
whether incurred or arising
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prior to, on or after, the Distribution Date, (2) which are specifically
assumed by Ventiv under an express provision of this Agreement or (3) which
are listed on Schedule 1.01(b)(ii).
Healthcare Services Option Plan: a new Plan to be adopted by Ventiv
in connection with the Distribution, pursuant to which, among other things,
options to purchase shares of Ventiv Common Stock, and restricted shares of
Ventiv Common Stock, may be granted to Healthcare Services Employees and
Healthcare Services Directors.
Healthcare Services Plan: any Plan maintained or contributed to by
any member of either Group prior to the Distribution Date primarily for the
benefit of Healthcare Services Employees.
Healthcare Services Policies: all Insurance Policies, current and
past, which relate to the Healthcare Services Business and do not relate to
the Xxxxxx Business, including the Insurance Policies listed on Schedule
1.01(c).
Healthcare Services Qualified Plan: a Qualified Plan that (1) will be
sponsored or maintained by any member of the Healthcare Services Group, (2)
will provide benefits for Healthcare Services Individuals who, immediately
prior to the Cut-Off Date, are active or inactive participants in or
otherwise entitled to benefits under any Joint Qualified Plan or Healthcare
Services Free-Standing Qualified Plan and (3) is expected to provide
benefits substantially identical to those provided by the Joint Qualified
Plan or Healthcare Services Free-Standing Qualified Plan in which such
Healthcare Services Individual currently participates.
Healthcare Services Restricted Stock: shares of Ventiv Common Stock
issued to an individual pursuant to the Healthcare Services Option Plan
subject to forfeiture in the event that certain terms and conditions are
not satisfied.
Healthcare Services Subsidiaries: all of the corporations listed on
Schedule 1.01(d).
Healthcare Services Support Agreements: any obligation or agreement
of the Xxxxxx Group under any guarantee, letter of credit, letter of
comfort or working capital maintenance agreement obtained prior to the
Distribution Date for the benefit of the Healthcare Services Business or
any member of the Healthcare Services Group.
Indemnifiable Losses: all losses, Liabilities, damages, claims,
demands, judgments or settlements of any nature or kind, known or unknown,
fixed, accrued, absolute or contingent, liquidated or unliquidated,
including all reasonable costs and expenses (legal, accounting or otherwise
as such costs are incurred) relating thereto, suffered by an Indemnitee.
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Indemnifying Party: a Person who or which is obligated under this
Agreement to provide indemnification.
Indemnitee: a Person who may seek indemnification under this
Agreement.
Indemnity Payment: an amount that an Indemnifying Party is required
to pay to an Indemnitee pursuant to Article IV hereof.
Information: all records, books, contracts, instruments, computer
data and other data and information.
Information Statement: the Information Statement to be sent to the
holders of Xxxxxx Common Stock as of the Record Date in connection with the
Distribution.
Insurance Administration: with respect to each Insurance Policy, (1)
the accounting for premiums (including retrospectively-rated premiums),
defense costs, indemnity payments, deductibles and retentions as
appropriate under the terms and conditions of each of the Insurance
Policies, (2) the reporting to excess insurance carriers of any losses or
claims which may cause the per-occurrence or aggregate limits of any
Insurance Policy to be exceeded and (3) the distribution of Insurance
Proceeds as contemplated by this Agreement.
Insurance Policy: insurance policies and insurance contracts of any
kind that are owned or maintained by any member of either Group as the
insured interest, including primary and excess policies, comprehensive
general liability policies, automobile, aircraft and workers' compensation
insurance policies, and self-insurance and captive insurance company
arrangements, together with the rights, benefits and privileges thereunder.
Insurance Proceeds: those monies received by an insured from an
insurance carrier or paid by an insurance carrier on behalf of the insured,
in either case, net of any applicable premium adjustment, retrospectively-
rated premium, deductible, retention, cost or reserve paid or held by or
for the benefit of such insured.
Insured Claims: those Liabilities that, individually or in the
aggregate, are covered within the terms and conditions of any of the
Insurance Policies, whether or not subject to deductibles, coinsurance,
uncollectability or retrospectively-rated premium adjustments, but only to
the extent that such Liabilities are within applicable Insurance Policy
limits, including aggregates.
Interim Services Agreement: an interim services agreement to be
entered into between Xxxxxx and Ventiv, substantially in the form attached
hereto as Exhibit A, with such changes as may be satisfactory to Xxxxxx and
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Ventiv,
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providing for (1) the Xxxxxx Group to make available certain personnel and
services to the Healthcare Services Group and (2) the Healthcare Services
Group to make available certain personnel and services to the Xxxxxx Group,
in each case for a period of time following the Distribution Date.
IRS: the Internal Revenue Service.
Liabilities: all debts, liabilities and obligations, whether absolute
or contingent, matured or unmatured, liquidated or unliquidated, accrued or
unaccrued, known or unknown, whenever arising, and whether or not the same
would properly be reflected on a balance sheet, including all costs and
expenses related thereto.
Nasdaq: the Nasdaq National Market.
Ventiv: as defined in the Recitals to this Agreement.
Ventiv Common Stock: the common stock, par value $0.001 per share, of
Ventiv.
NYSE: the New York Stock Exchange, Inc.
Other Agreements: the Interim Services Agreement and the Tax Sharing
Agreement.
Person: an individual, a partnership, a limited liability company, a
joint venture, a corporation, a trust, an unincorporated organization or a
government or any department or agency thereof.
Plan: any plan, policy or arrangement or contract or agreement
providing benefits (including bonuses, deferred compensation, incentive
compensation, savings, stock purchases, pensions, profit sharing or
retirement or other retiree benefits, including retiree medical benefits)
for any group of employees or former employees or individual employee or
former employee, or the beneficiary or beneficiaries of any such employee
or former employee, whether formal or informal or written or unwritten and
whether or not legally binding, and including any means, whether or not
legally required, pursuant to which any benefit is provided by an employer
to any employee or former employee or the beneficiary or beneficiaries of
any such employee or former employee.
Prior Plan Year: to the extent applicable with respect to any Plan,
any plan year or fiscal year that ended on or prior to the Cut-Off Date.
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Qualified Plan: a Plan which is an employee pension benefit plan
(within the meaning of Section 3(2) of ERISA) and which constitutes or is
intended in good faith to constitute a qualified plan under Section 401(a)
of the Code.
Record Date: the date to be determined by the Board of Directors of
Xxxxxx as the record date for determining stockholders of Xxxxxx Common
Stock entitled to receive the Distribution.
Registration Statement: a registration statement on Form 10 to effect
the registration of the Ventiv Common Stock pursuant to the Exchange Act.
Representative: with respect to any Person, any of such Person's
directors, officers, employees, agents, consultants, advisors, accountants,
attorneys and representatives.
SEC: the Securities and Exchange Commission.
Securities Act: the Securities Act of 1933, as amended, together with
the rules and regulations promulgated thereunder.
Service Agreement: any third-party administrator or claims handling
agreement of any kind or nature to which any member of either Group is
directly or indirectly a party, in effect as of the date hereof, related to
the handling of Healthcare Services Claims.
Xxxxxx: as defined in the recitals to this Agreement.
Xxxxxx Assets: subject to the provisions of the Other Agreements, all
of the Assets, other than the Healthcare Services Assets, held immediately
prior to the Distribution Date by any member of either Group.
Xxxxxx Business: all of the businesses, other than the Healthcare
Services Business, conducted immediately prior to the Distribution Date by
any member of either Group.
Xxxxxx Common Stock: the common stock, par value $0.001 per share, of
Xxxxxx.
Xxxxxx Director: any individual who is a director of Xxxxxx following
the Distribution.
Xxxxxx Employee: any individual who at any time prior to the
Distribution Date is or was an officer or employee of any member of any
Group, other than a Healthcare Services Employee.
Xxxxxx Group: Xxxxxx and its Affiliates, other than members of the
Healthcare Services Group.
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Xxxxxx Individual: any individual who (1) is a Xxxxxx employee, (2)
at any time prior to the Distribution Date is or was an officer or employee
of any Former Xxxxxx Business, or (3) is a beneficiary of any individual
specified in clause (1) or (2).
Xxxxxx Liabilities: subject to the provisions of the Other
Agreements, all of the Liabilities, other than the Healthcare Services
Liabilities, of any member of either Group including, without limitation,
all liabilities specified on Schedule 1.01(e).
Xxxxxx Option: an option to purchase shares of Xxxxxx Common Stock
granted pursuant to the Xxxxxx Option Plan, together with any stock
appreciation right or limited stock appreciation right issued in connection
therewith.
Xxxxxx Option Plan: the 1996 Stock Incentive Plan of Xxxxxx.
Xxxxxx Plan: any Plan maintained or contributed to by any member of
either Group prior to the Distribution Date, other than a Healthcare
Services Plan.
Xxxxxx Policies: all Insurance Policies, current and past, which
relate to both the Xxxxxx Business and the Healthcare Services Business,
including the Insurance Policies listed on Schedule 1.01(g).
Xxxxxx Restricted Stock: shares of Xxxxxx Common Stock issued to an
individual pursuant to the Xxxxxx Option Plan subject to forfeiture in the
event that certain terms and conditions are not satisfied.
Subsidiary: with respect to any specified Person, any corporation or
other legal entity of which such Person or any of its Subsidiaries controls
or owns, directly or indirectly, more than fifty percent (50%) of the stock
or other equity interest entitled to vote on the election of members to the
board of directors or similar governing body; provided, however, that for
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purposes of this Agreement, (1) the Healthcare Services Subsidiaries shall
be deemed to be Subsidiaries of Xxxxxx Healthcare Services and (2) the
Healthcare Services Subsidiaries shall not be deemed to be Subsidiaries of
Xxxxxx or any of Xxxxxx'x Subsidiaries.
Tax: as defined in the Tax Sharing Agreement.
Tax Sharing Agreement: a tax sharing agreement to be entered into
between Xxxxxx and Ventiv, substantially in the form attached hereto as
Exhibit B, with such changes as may be mutually satisfactory to Xxxxxx and
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Ventiv.
Third-Party Claim: any claim, suit, arbitration, inquiry, proceeding
or investigation by or before any court, any governmental or other
regulatory or administrative agency or commission or any arbitration
tribunal asserted by a Person who is not a party hereto.
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Transfer Tax: the applicable state and local real estate transfer
taxes associated with the transfer of any Assets constituting Healthcare
Services Assets.
Welfare Plan: any Plan, including but not limited to the Plans listed
on Schedule 1.01(h), which is not a Qualified Plan and which provides
medical, health, disability, accident, life insurance, death, dental or
other welfare benefits, including any post-employment benefits or retiree
medical benefits.
1.02 REFERENCES TO TIME. All references in this Agreement to times of the
day shall be to Washington, D.C. Time.
ARTICLE II
CERTAIN TRANSACTIONS PRIOR TO THE DISTRIBUTION DATE
2.01 CERTIFICATE OF INCORPORATION; BY-LAWS. Xxxxxx and Ventiv shall take
all action necessary so that, at the Distribution Date, the Amended and Restated
Certificate of Incorporation and By-laws of Ventiv shall be in the forms
attached hereto as Exhibit C and Exhibit D, respectively.
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2.02 ISSUANCE OF STOCK. Prior to or as of the Distribution Date, the
parties hereto shall take all steps necessary to reclassify the outstanding
shares of Ventiv Common Stock so that, except as otherwise contemplated by this
Agreement, immediately prior to or as of the Distribution Date the number of
shares of Ventiv Common Stock outstanding and held by Xxxxxx shall be equal to
one-third (l/3) the number of shares of Xxxxxx Common Stock outstanding on the
Record Date.
2.03 TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES. Prior to the
Distribution Date, the parties hereto shall take all action necessary to
transfer to Ventiv, and to cause Ventiv to assume, as the case may be, effective
as of the Distribution Date, (1) all of the shares of capital stock of the
Healthcare Services Subsidiaries held by the Xxxxxx Group, (2) all of the right,
title and interest of the Xxxxxx Group in the Healthcare Services Assets, and
(3) all of the Healthcare Services Liabilities, as more-fully set forth on
Schedule 2.03 hereto.
2.04 CONDUCT OF BUSINESS PENDING THE DISTRIBUTION DATE. Each of the
parties hereto agrees that from the date hereof until the Distribution Date,
except as otherwise contemplated by this Agreement, it will use its best efforts
to carry on the Healthcare Services Business diligently in the ordinary course
and substantially in the same manner as heretofore conducted and to preserve
intact the business organization and goodwill of the Healthcare Services
Business (including using its best efforts to cause its Subsidiaries to take
such actions).
2.05 REFINANCING. Each of the parties hereto agrees that it will use
reasonable efforts to obtain, prior to the Distribution Date, all necessary
consents, waivers or amendments to each bank credit agreement, debt security or
other financing
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facility to which it and its Subsidiaries is a party or by which it or any of
its Subsidiaries is bound, or to refinance such agreement, security or facility,
in each case on terms satisfactory to Xxxxxx and Ventiv and to the extent
necessary to permit the Distribution to be consummated without any material
breach of the terms of such agreement, security or facility.
2.06 REGISTRATION AND LISTING. Prior to the Distribution Date:
(a) Xxxxxx and Ventiv shall prepare the Information Statement and
the Registration Statement. Ventiv shall file the Registration Statement
with the SEC. Xxxxxx and Ventiv shall use reasonable efforts to cause the
Registration Statement to become effective under the Exchange Act as
promptly as reasonably practicable. Xxxxxx and Ventiv shall prepare the
Information Statement; and after the Registration Statement becomes
effective, Xxxxxx shall cause the Information Statement to be mailed to the
holders of Xxxxxx Common Stock as of the Record Date.
(b) The parties hereto shall use their best efforts to take all such
action as may be necessary or appropriate under state securities and "blue
sky" laws in connection with the transactions contemplated by this
Agreement.
(c) Xxxxxx and Ventiv shall prepare, and Ventiv shall file and seek
to make effective, an application for the listing of the Ventiv Common
Stock on Nasdaq, subject to official notice of issuance.
(d) The parties hereto shall cooperate in preparing, filing with the
SEC and causing to become effective any registration statements or
amendments thereto which are necessary or appropriate in order to effect
the transactions contemplated hereby or to reflect the establishment of, or
amendments to, any Plans contemplated hereby.
ARTICLE III
THE DISTRIBUTION
3.01 RECORD DATE AND DISTRIBUTION DATE. Subject to the satisfaction of the
conditions set forth in Section 10.01(a) hereof, the Board of Directors of
Xxxxxx shall establish the Record Date and the Distribution Date and any
appropriate procedures in connection with the Distribution.
3.02 THE AGENT. Prior to the Distribution Date, the Agent to make
appropriate arrangements for, among other things, the payment of the
Distribution to the holders of Xxxxxx Common Stock in accordance with this
Article III.
3.03 DELIVERY OF SHARE CERTIFICATES TO THE AGENT. Prior to or as of the
Distribution Date, Ventiv shall deliver to the Agent a share certificate
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representing all of the outstanding shares of Ventiv Common Stock to be
distributed in connection with the payment of the Distribution. After the
Distribution Date, upon the request of the Agent, Ventiv shall provide all
certificates for shares of Ventiv Common Stock that the Agent shall require in
order to effect the Distribution.
3.04 DISTRIBUTION. Except as otherwise contemplated by this Agreement, the
Agent shall distribute, as of the Distribution Date, one (1) share of Ventiv
Common Stock in respect of every three (3) shares of Xxxxxx Common Stock held by
holders of record of Xxxxxx Common Stock on the Record Date. All shares of
Ventiv Common Stock issued in the Distribution shall be duly authorized, validly
issued, fully paid and nonassessable.
3.05 PAYMENT IN LIEU OF FRACTIONAL SHARES. In lieu of the distribution of
fractional shares of Ventiv Common Stock to holders of record of Xxxxxx Common
Stock as of the Record Date, the parties shall cause the Agent to cause all such
fractional shares to be aggregated and the resulting shares sold for the account
of such stockholders. Such sales shall be effected as soon as practicable after
the Distribution Date. Following the sale of the aggregated fractional shares of
Ventiv Common Stock, the parties shall cause the Agent to distribute the
proceeds of the sale of the aggregated fractional shares to such stockholders.
ARTICLE IV
SURVIVAL, ASSUMPTION AND INDEMNIFICATION
4.01 SURVIVAL OF AGREEMENTS. All covenants and agreements of the parties
hereto contained in this Agreement shall survive the Distribution Date.
4.02 TAXES AND EMPLOYEE-RELATED ASSETS AND LIABILITIES. This Article IV
shall not be applicable to any Plan Assets or any Indemnifiable Losses or
Liabilities related to (1) Taxes which shall be governed by the Tax Sharing
Agreement, or (2) the current or former employment of any Xxxxxx Individual or
Healthcare Services Individual, or the compensation or benefits for any Xxxxxx
Director or Healthcare Services Director, under any Plan or otherwise, which
shall be governed by Article VII hereof.
4.03 ASSUMPTION AND INDEMNIFICATION.
(a) Subject to Section 4.02 hereof, the Tax Sharing Agreement and
Article VII hereof, from and after the Distribution Date, Xxxxxx shall
retain or assume, as the case may be, and shall indemnify, defend and hold
harmless each Healthcare Services Individual and each member of the
Healthcare Services Group, and each of their Representatives and
Affiliates, from and against, (1) all liabilities for third party claims
relating to, arising out of or due to, directly or indirectly, the service
by any Healthcare Services Individual as an officer, director or employee
of any member of the Xxxxxx Group prior to the Distribution, except
12
to the extent covered by insurance and provided such indemnification would be
permitted by law if such officer, director or employee made a claim for
indemnification, (2) all Liabilities of the Xxxxxx Group under this Agreement or
any of the Other Agreements, and (3) all Indemnifiable Losses of any such
Healthcare Services Individual, member of the Healthcare Services Group,
Representative or Affiliate relating to, arising out of or due to, directly or
indirectly, the Xxxxxx Assets, the Xxxxxx Liabilities, the Xxxxxx Business, the
Xxxxxx Individuals or the Xxxxxx Group's Representatives, whether relating to or
arising out of occurrences prior to, on or after the Distribution Date.
(b) Subject to Section 4.02 hereof, the Tax Sharing Agreement and Article
VII, and except as specifically provided in Section 4.03(a) hereof, from and
after the Distribution Date, Ventiv shall assume, and shall indemnify, defend
and hold harmless each Xxxxxx Individual and each member of the Xxxxxx Group,
and each of their Representatives and Affiliates, from and against, (1) all
Liabilities of the Healthcare Services Group under this Agreement or any of the
Other Agreements and (2) all Indemnifiable Losses of any such Xxxxxx Individual,
member of the Xxxxxx Group, or any Representative or Affiliate of the Xxxxxx
Group relating to, arising out of or due to, directly or indirectly, the
Healthcare Services Assets, the Healthcare Services Liabilities, the Healthcare
Services Business, the Healthcare Services Employees or the Healthcare Services
Group's Representatives, whether relating to or arising out of occurrences prior
to or after the Distribution Date.
(c) If an Indemnitee realizes a Tax benefit or detriment by reason of
having incurred an Indemnifiable Loss for which such Indemnitee receives an
Indemnity Payment from an Indemnifying Party or by reason of receiving an
Indemnity Payment, then such Indemnitee shall pay to such Indemnifying Party an
amount equal to the Tax benefit, or such Indemnifying Party shall pay to such
Indemnitee an additional amount equal to the Tax detriment (taking into account
any Tax detriment resulting from the receipt of such additional amounts), as the
case may be. If, in the opinion of counsel to an Indemnifying Party reasonably
satisfactory in form and substance to the affected Indemnitee, there is a
substantial likelihood that the Indemnitee will be entitled to a Tax benefit by
reason of an Indemnifiable Loss, the Indemnifying Party promptly shall notify
the Indemnitee and the Indemnitee promptly shall take any steps (including the
filing of such returns, amended returns or claims for refunds consistent with
the claiming of such Tax benefit) that, in the reasonable judgment of the
Indemnifying Party, are necessary and appropriate to obtain any such Tax
benefit. If, in the opinion of counsel to an Indemnitee reasonably satisfactory
in form and substance to the affected Indemnifying Party, there is a substantial
likelihood that the Indemnitee will be subjected to a Tax detriment by reason of
an Indemnification Payment, the Indemnitee promptly shall notify the
Indemnifying Party and the Indemnitee promptly shall take any steps (including
the filing of such returns or amended returns or the payment of Tax
underpayments consistent
13
with the settlement of any Liability for Taxes arising from such Tax detriment)
that, in the reasonable judgment of the Indemnitee, are necessary and
appropriate to settle any Liabilities for Taxes arising from such Tax detriment.
If, following a payment by an Indemnitee or an Indemnifying Party pursuant to
this Section 4.03(c) in respect of a Tax benefit or detriment, there is an
adjustment to the amount of such Tax benefit or detriment, then each of Xxxxxx
and Ventiv shall make appropriate payments to the other, including the payment
of interest thereon at the federal statutory rate then in effect, to reflect
adjustments.
(d) The amount which an Indemnifying Party is required to pay to any
Indemnitee pursuant to this Section 4.03 shall be reduced (including
retroactively) by any Insurance Proceeds and other amounts actually recovered by
such Indemnitee in reduction of the related Indemnifiable Loss, it being
understood and agreed that each of Xxxxxx and Ventiv shall use its best efforts
to collect any such proceeds or other amounts to which it or any of its
Subsidiaries is entitled, without regard to whether it is the Indemnifying Party
hereunder. If an Indemnitee receives an Indemnity Payment in respect of an
Indemnifiable Loss and subsequently receives Insurance Proceeds or other amounts
in respect of such Indemnifiable Loss, then such Indemnitee shall pay to such
Indemnifying Party an amount equal to the difference between (1) the sum of the
amount of such Indemnity Payment and the amount of such Insurance Proceeds or
other amounts actually received and (2) the amount of such Indemnifiable Loss,
adjusted (at such time as appropriate adjustment can be determined) in each case
to reflect any premium adjustment attributable to such claim.
(e) If any Indemnity Payment required to be made hereunder or under any
Other Agreement is denominated in a currency other than United States dollars,
the amount of such payment shall be translated into United States dollars using
the Foreign Exchange Rate for such currency determined in accordance with the
following rules:
(1) with respect to an Indemnifiable Loss arising from 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 determined as of the date on which such
financial institution is reimbursed;
(2) with respect to an Indemnifiable Loss covered by insurance, the
Foreign Exchange Rate for such currency shall be the Foreign Exchange Rate
employed by the insurance company providing such insurance in settling such
Indemnifiable Loss with the Indemnifying Party; and
(3) with respect to an Indemnified Loss not described in clause (1)
or (2) of this Section 4.03(e), the Foreign Exchange Rate for such
14
currency shall be determined as of the date that notice of the claim with
respect to such Indemnifiable Loss is given to the Indemnitee.
4.04 PROCEDURE FOR INDEMNIFICATION.
(a) If any Indemnitee receives notice of the assertion of any Third-Party
Claim with respect to which an Indemnifying Party is obligated under this
Agreement to provide indemnification, such Indemnitee shall give such
Indemnifying Party notice thereof promptly after becoming aware of such
Third-Party Claim; provided, however, that the failure of any Indemnitee to
-------- -------
give notice as provided in this Section 4.04 shall not relieve any 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 notice. Such
notice shall describe such Third-Party Claim in reasonable detail and, if
practicable, shall indicate the estimated amount of the Indemnifiable Loss that
has been or may be sustained by such Indemnitee.
(b) An Indemnifying Party, at such Indemnifying Party's own expense and
through counsel chosen by such Indemnifying Party (which counsel shall be
reasonably satisfactory to the Indemnitee), may elect to defend any Third-
Party Claim; provided, however, that such an election by the Indemnifying
-------- -------
Party shall be deemed an admission of its obligation to Indemnify the Indemnitee
with respect to such Third-Party Claim. If an Indemnifying Party elects to
defend a Third-Party Claim, then, within ten (10) Business Days after receiving
notice of such Third-Party Claim (or sooner, if the nature of such Third-Party
Claim so requires), such Indemnifying party shall notify the Indemnitee of its
intent to do so, and such Indemnitee shall cooperate in the defense of such
Third-Party Claim. Such Indemnifying Party shall pay such Indemnitee's
reasonable out-of-pocket expenses incurred in connection with such cooperation.
After notice from an Indemnifying Party to an Indemnitee of its election to
assume the defense of a Third-Party Claim, such Indemnifying Party shall not be
liable to such Indemnitee under this Article IV for any legal or other expenses
subsequently incurred by such Indemnitee in connection with the defense thereof;
provided, however, that such Indemnitee shall have the right to employ one law
-------- -------
firm as counsel to represent such Indemnitee (which firm shall be reasonably
acceptable to the Indemnifying Party) if, in such Indemnitee's reasonable
judgment, either a conflict of interest between such Indemnitee and such
Indemnifying Party exists in respect of such claim or there may be defenses
available to such Indemnitee which are different from or in addition to those
available to such Indemnifying Party, and in that event (1) the reasonable fees
and expenses of such separate counsel shall be paid by such Indemnifying Party
and (2) each of such Indemnifying Party and such Indemnitee shall have the right
to run its own defense in respect of such claim. If an Indemnifying Party elects
not to defend against a Third-Party Claim, or fails to notify an Indemnitee of
its election as provided in this Section 4.04 within the period of ten (10)
Business Days described above, such Indemnitee may defend, compromise and settle
such Third-
15
Party Claim; provided, however, that no such Indemnitee may compromise or
-------- -------
settle any such Third-Party Claim without the prior written consent of the
Indemnifying Party, which consent shall not be withheld unreasonably.
Notwithstanding the foregoing, the Indemnifying Party shall not, without
the prior consent of the Indemnitee, (1) settle or compromise any Third-
Party Claim or consent to the entry of any judgment which does not include
as an unconditional term thereof the delivery by the claimant or plaintiff
to the Indemnitee of a written release from all Liability in respect of
such Third-Party Claim or (2) settle or compromise any Third-Party Claim in
any manner that may adversely affect the Indemnitee.
4.05 REMEDIES CUMULATIVE. The remedies provided in this Article IV shall
be cumulative and shall not preclude assertion by any Indemnitee of any other
rights or the seeking of any other remedies against any Indemnifying Party.
ARTICLE V
CERTAIN ADDITIONAL COVENANTS
5.01 FURTHER ASSURANCES.
(a) In addition to the actions specifically provided for elsewhere
in this Agreement, each of the parties hereto shall use its best efforts to
take, or cause to be taken, all actions, and to do, or cause to be done,
all things reasonably necessary, proper or advisable under applicable laws,
regulations and agreements to consummate and make effective the
transactions contemplated by this Agreement. Without limiting the
foregoing, each party hereto shall cooperate with the other parties, and
execute and deliver, or use its best efforts to cause to be executed and
delivered, all instruments, including instruments of conveyance, assignment
and transfer, and to make all filings with, and to obtain all consents,
approvals or authorizations of, any governmental or regulatory authority or
any other Person under any permit, license, agreement, indenture or other
instrument, and take all such other actions as such party may reasonably be
requested to take by any other party hereto from time to time, consistent
with the terms of this Agreement, in order to effectuate the provisions and
purposes of this Agreement and the transfers of Assets and Liabilities and
the other transactions contemplated hereby. If any such transfer of Assets
or Liabilities is not consummated prior to or at the Distribution Date,
then the party hereto retaining such Asset or Liability shall thereafter
hold such Asset in trust for the use and benefit of the party entitled
thereto (at the expense of the party entitled thereto), or shall retain
such Liability for the account of the party by whom such Liability is to be
assumed pursuant hereto, as the case may be, and shall take such other
action as may be reasonably requested by the party to whom such Asset is to
be transferred, or by whom such Liability is to be assumed, as the case may
be, in order to place such party, insofar as reasonably possible, in the
same position as if such Asset or Liability had been transferred as
contemplated hereby. If and when any such Asset or Liability
16
becomes transferable, such transfer shall be effected forthwith. The
parties hereto agree that, as of the Distribution Date, each party hereto
shall be deemed to have acquired complete and sole beneficial ownership of
all of the Assets, together with all rights, powers and privileges incident
thereto, and shall be deemed to have assumed in accordance with the terms
of this Agreement all of the Liabilities, and all duties, obligations and
responsibilities incident thereto, that such party is entitled to acquire
or required to assume pursuant to the terms of this Agreement.
(b) Without limiting the generality of Section 5.01(a) hereof,
Xxxxxx, as the sole stockholder of Ventiv, shall ratify any actions which
are reasonably necessary or desirable to be taken by Ventiv to effectuate
the transactions contemplated by this Agreement in a manner consistent with
the terms of this Agreement, including the preparation and implementation
of appropriate Plans for Healthcare Services Employees.
5.02 VENTIV BOARD OF DIRECTORS. Prior to, or simultaneously with, the
Distribution Date, Ventiv shall take such actions as are necessary such that its
Board of Directors is comprised of those individuals named as directors in the
Information Statement.
5.03 CONTINUING CONTRACTUAL ARRANGEMENTS. Notwithstanding anything in this
Agreement to the contrary, except as set forth in Sections 5.04 and 5.05 hereof,
to the extent that any member of either Group is now providing or selling, or in
the future may provide or sell, to any member of the other Group any services,
benefits or products pursuant to any written or oral agreement or understanding
whatsoever, such agreement or understanding shall not be deemed altered, amended
or terminated as a result of this Agreement or the consummation of the
transactions contemplated hereby.
5.04 INTERCOMPANY ACCOUNTS. Effective as of the Distribution Date all
intercompany receivables, payables, loans or advances between Xxxxxx and Ventiv
shall be deemed contributed to capital and thereby cancelled without the payment
of any cash by either Xxxxxx or Ventiv to the other.
5.05 CASH ACCOUNTS. The cash accounts on the Distribution Date of Xxxxxx
and each Xxxxxx Subsidiary and Ventiv and each Healthcare Services Subsidiary
shall remain the property of each respective company or Subsidiary.
5.06 OTHER AGREEMENTS. Each of Xxxxxx and Ventiv shall use reasonable
efforts to enter into or to cause the appropriate members of its Group to enter
into, the Other Agreements prior to the Distribution Date. If there shall be a
conflict between the provisions of this Agreement and the provisions of the
Other Agreements, the provisions of the Other Agreements shall control.
5.07 TRANSFER TAXES. Ventiv shall pay any Gains Tax, Transfer Tax and
similar transfer Taxes in any jurisdiction (and any penalties and interest with
respect
17
to such Taxes), which become payable in connection with the Distribution on
behalf of the stockholders of Xxxxxx or Ventiv. Ventiv shall indemnify and hold
harmless the stockholders of Xxxxxx and Ventiv from and against any Liability
with respect to such Taxes (including any penalties, interest and reasonable
professional fees). Ventiv shall prepare and file any required returns with
respect to such Taxes (including returns on behalf of the stockholders of Xxxxxx
and Ventiv).
5.08 HEALTHCARE SERVICES SUPPORT AGREEMENTS. Effective as of the
Distribution Date, Ventiv shall cause itself or one or more members of the
Healthcare Services Group to be substituted in all respects for the Xxxxxx Group
or any member thereof in respect of all Healthcare Services Support Agreements.
Subsequent to the Distribution Date, with respect to any uncancelled Healthcare
Services Support Agreement for which no substitution has yet been effected,
Ventiv shall indemnify the Xxxxxx Group against Liabilities under any such
Healthcare Services Support Agreement in accordance with the provisions of
Article IV hereof.
ARTICLE VI
ACCESS TO INFORMATION
6.01 PROVISION OF CORPORATE RECORDS. Prior to or as promptly as
practicable after the Distribution Date, Xxxxxx shall deliver to Ventiv all
corporate books and records of the Healthcare Services Group and copies of all
corporate books and records of the Xxxxxx Group relating to the Healthcare
Services Assets, the Healthcare Services Liabilities, or the Healthcare Services
Business, including in each case all active agreements, active litigation files
and government filings. From and after the Distribution Date, all books, records
and copies so delivered shall be the property of Ventiv.
6.02 ACCESS TO INFORMATION. From and after the Distribution Date, each of
Xxxxxx and Ventiv shall afford to the other and to the other's Representatives
reasonable access and duplicating rights during normal business hours to all
Information within such party's possession relating to such other party's
businesses, Assets or Liabilities, insofar as such access is reasonably required
by such other party. Without limiting the foregoing, Information may be
requested under this Section 6.02 for audit, accounting, claims, litigation and
Tax purposes, as well as for purposes of fulfilling disclosure and reporting
obligations.
6.03 PRODUCTION OF WITNESSES. After the Distribution Date, each of Xxxxxx
and Ventiv shall use reasonable efforts to make available to the other, upon
written request, its directors, officers, employees and agents as witnesses to
the extent that any such Person may reasonably be required (giving consideration
to business demands of such Person) in connection with any legal, administrative
or other proceedings in which the requesting party may from time to time be
involved.
18
6.04 RETENTION OF RECORDS. Except as otherwise required by law or agreed
in writing, or as otherwise provided in the Tax Sharing Agreement, each of
Xxxxxx and Ventiv shall retain, for a period of at least ten (10) years
following the Distribution Date, all significant Information in such party's
possession or under its control relating to the business, Assets or Liabilities
of the other party and, after the expiration of such ten-year period, prior to
destroying or disposing of any of such Information, (a) the party proposing to
dispose of or destroy any such Information shall provide no less than thirty
(30) days' prior written notice to the other party, specifying the Information
proposed to be destroyed or disposed of, and (b) if, prior to the scheduled date
for such distribution or disposal, the other party requests in writing that any
of the Information proposed to be destroyed or disposed of be delivered to such
other party, the party proposing to dispose of or destroy such Information shall
promptly arrange for the delivery of the requested Information to a location
specified by, and at the expense of, the requesting party.
6.05 CONFIDENTIALITY. From and after the Distribution Date, each of Xxxxxx
and Ventiv shall hold, and shall use its reasonable best efforts to cause its
Affiliates and Representatives to hold, in strict confidence all Information
concerning the other party obtained by it prior to the Distribution Date or
furnished to it by such other party pursuant to this Agreement or the Other
Agreements and shall not release or disclose such Information to any other
Person, except its Representatives, who shall be bound by the provisions of this
Section 6.05; provided, however, that Xxxxxx and Ventiv may disclose such
-------- -------
Information to the extent that (a) disclosure is compelled by judicial or
administrative process or, in the opinion of such party's counsel, by other
requirements of law, or (b) such party can show that such Information was (1)
available to such party on a nonconfidential basis prior to its disclosure by
the other party, (2) in the public domain through no fault of such party or (3)
lawfully acquired by such party from other sources after the time that it was
furnished to such party pursuant to this Agreement or the Other Agreements.
Notwithstanding the foregoing, each of Xxxxxx and Ventiv shall be deemed to have
satisfied its obligations under this Section 6.05 with respect to any
Information if it exercises the same care with regard to such Information as it
takes to preserve confidentiality for its own similar Information.
ARTICLE VII
EMPLOYEE BENEFITS
7.01 QUALIFIED PLANS.
(a) As soon as practicable after the date hereof and effective as of
the Cut-Off Date, Ventiv shall take, or cause to be taken, all actions
necessary and appropriate to establish and administer one or more
Healthcare Services Qualified Plans and to provide benefits thereunder for
all Healthcare Services Individuals who, immediately prior to the Cut-Off
Date, were participants in or otherwise entitled to benefits under any
Joint Qualified Plan. Ventiv agrees that each such Healthcare Services
Individual shall be, to the extent applicable, entitled, for all
19
purposes under any applicable Healthcare Services Qualified Plan, to be
credited with the term of service and any accrued benefit or account
balance credited to such Healthcare Services Individual as of the Cut-Off
Date under the terms of any applicable Joint Qualified Plan as if such
accrued benefit or account balance had originally been credited to such
Healthcare Services Individual under the Healthcare Services Qualified
Plan. Xxxxxx agrees to provide Ventiv, as soon as practicable after the
Distribution Date (with the cooperation of Ventiv to the extent that
relevant information is in the possession of the Healthcare Services
Group), with a list of the Healthcare Services Individuals who were, to the
best knowledge of Xxxxxx, participants in or otherwise entitled to benefits
under each Joint Qualified Plan immediately prior to the Cut-Off Date,
together with a listing, if requested by Ventiv, of each such Healthcare
Services Individual's term of service for eligibility and vesting purposes
under such Plan and a listing of each such Healthcare Services Individual's
accrued benefit or account balance thereunder. Xxxxxx shall, as soon as
practicable after the Distribution Date, provide Ventiv with such
additional information (in the possession of the Xxxxxx Group and not
already in the possession of the Healthcare Services Group) as may be
reasonably requested by Ventiv and necessary in order for the Healthcare
Services Group to establish and administer effectively any Healthcare
Services Qualified Plan.
(b) Xxxxxx agrees, as soon as practicable following the Distribution
Date, to direct the trustee of the trust funding each Joint Qualified Plan
which is a Joint Savings Plan to transfer to the trustee or other funding
agent of any applicable Healthcare Services Qualified Plan in cash,
securities or other property or a combination thereof, as reasonably
determined by Xxxxxx, an amount equal to the account balances as of the
date of transfer attributable to the participants and beneficiaries in such
Joint Savings Plan who are Healthcare Services Individuals plus the portion
of any unallocated contributions and trust earnings attributable to such
participants and beneficiaries who are Healthcare Services Individuals. To
the extent practicable such transfers shall be effected so as to preserve
investment elections of the participants and beneficiaries in each Joint
Savings Plan.
(c) In connection with the transfers described in this Section 7.01,
Xxxxxx and Ventiv shall cooperate in making any and all appropriate filings
required under the Code or ERISA, and the regulations thereunder, and any
applicable securities laws and take all such action as may be necessary and
appropriate to cause such transfers to take place as soon as practicable
after the Distribution Date; provided, however, that each such transfer
-------- -------
shall not take place until as soon as practicable after the later of (1)
the expiration of a thirty (30) day period following the date of filing the
required Forms 5310-A (or any successor form thereto) with the IRS and (2)
the earlier of (A) the receipt of a favorable IRS determination letter with
respect to the qualification of each applicable Healthcare Services
Qualified Plan under Section 401(a) of the Code or (B) the receipt by
Xxxxxx of an opinion of counsel reasonably satisfactory in form and
substance to
20
Xxxxxx and Ventiv to the effect that such counsel believes each applicable
Healthcare Services Qualified Plan is qualified under Section 401(a) of the
Code. Xxxxxx and Ventiv agree to provide to such counsel such information
in the possession of the Xxxxxx Group and the Healthcare Services Group,
respectively, as may be reasonably requested by such counsel in connection
with the issuance of such opinion. Xxxxxx agrees, during the period ending
with the date of complete transfer of assets and liabilities to each such
Healthcare Services Qualified Plan, to cause distributions in respect of
terminated or retired participants who are Healthcare Services Individuals
to be made, on behalf of Ventiv, from the relevant Joint Qualified Plan in
accordance with applicable law and pursuant to plan provisions.
(d) Xxxxxx and Ventiv shall take, or cause to be taken, all such
action as may be necessary or appropriate in order to establish Ventiv or
one or more members of the Healthcare Services Group, as appropriate, as
successor to all rights, assets, duties, Liabilities and obligations as of
the Distribution Date under, or with respect to, each Healthcare Services
Free-Standing Qualified Plan. Xxxxxx agrees that, prior to the Distribution
Date or as soon as practicable thereafter, it shall provide Ventiv with all
information (in the possession of the Xxxxxx Group and not already in the
possession of the Healthcare Services Group) as may be reasonably requested
by Ventiv and necessary for the Healthcare Services Group to administer
effectively such Healthcare Services Free-Standing Qualified Plan.
(e) Except as specifically set forth in this Section 7.01, from and
after the Distribution Date, (1) the Xxxxxx Group shall cease to have any
liability or obligation whatsoever with respect to Healthcare Services
Individuals under the Joint Qualified Plans, and Ventiv shall assume or
retain, as the case may be, and shall be solely responsible for, all
liabilities and obligations whatsoever of either Group with respect to
Healthcare Services Individuals under the Joint Qualified Plans and shall
be solely responsible for all liabilities and obligations whatsoever of
either Group with respect to Healthcare Services Individuals under the
Joint Qualified Plans and shall be solely responsible for all liabilities
and obligations whatsoever under the Healthcare Services Qualified Plans
and (2) the Xxxxxx Group shall cease to have any liability or obligation
whatsoever under the Healthcare Services Free-Standing Qualified Plans and
Ventiv shall assume or retain, as the case may be, and shall be solely
responsible for, all liabilities and obligations whatsoever of either group
under the Healthcare Services Free-Standing Plans; provided, however, that
-------- -------
Xxxxxx shall either be responsible for or make all required contributions,
no later than the later of the Distribution Date and the date such
contributions are legally required to be made (A) in respect of Healthcare
Services Individuals with respect to each Joint Qualified Plan and (B) with
respect to all participants in the Healthcare Services Free-Standing
Qualified Plans, in each case, for all Prior Plan Years and for the portion
of the Current Plan Year ending on the Cut-Off Date, to the extent not
previously made.
21
7.02 [INTENTIONALLY OMITTED].
7.03 WELFARE PLANS.
(a) As of the Distribution Date, Ventiv shall assume or retain, or
cause one or more members of the Healthcare Services Group to assume or
retain, as the case may be, and shall be solely responsible for, or cause
its insurance carriers to be responsible for all liabilities and
obligations whatsoever of either Group whether or not incurred prior to the
Distribution Date, in connection with claims under any Welfare Plan
(including any Welfare Plan providing for post-retirement or retiree
medical benefits) in respect of any Healthcare Services Individual and the
Xxxxxx Group shall cease to have any liability or obligation with respect
thereto.
(b) Ventiv shall take, or cause to be taken, all actions necessary
and appropriate on behalf of itself and the Healthcare Services Group (1)
to assume any existing Welfare Plan of either Group, which Welfare Plan, as
of the Distribution Date, provides benefits solely for Healthcare Services
Individuals or (2) otherwise to adopt such Welfare Plans as necessary to
provide welfare benefits, effective as of the Distribution Date, and to
assume the liabilities and obligations to Healthcare Services Individuals
which are or shall become the responsibility of Ventiv to the extent
specified in Section 7.03(a) hereof. For this purpose, with respect to any
Healthcare Services Individual, Ventiv or a member of the Healthcare
Services Group shall, to the extent applicable, credit such Healthcare
Services Individual with any term of service provided to any member of
either Group, and consider such Healthcare Services Individual to have
satisfied any other eligibility criteria (including satisfaction of
applicable deductibles or coinsurance amounts) to the extent so satisfied
as of the Distribution Date, as if such service had been rendered to Ventiv
or the member of the Healthcare Services Group and as if such eligibility
criteria had been satisfied while employed by Ventiv or the member of the
Healthcare Services Group. In connection with the foregoing, Xxxxxx agrees
to provide Ventiv or its designated insurance representative with such
information (in the possession of the Xxxxxx Group and not already in the
possession of the Healthcare Services Group) as may be reasonably requested
by Ventiv and necessary for the Healthcare Services Group to assume or
establish any such Welfare Plan.
(c) The Xxxxxx Group shall assume, or retain, all liabilities and
obligations whatsoever of either Group for benefits under any Welfare Plan
other than as set forth in Section 7.03(a) hereof.
7.04 [INTENTIONALLY OMITTED.]
7.05 [INTENTIONALLY OMITTED.]
22
7.06 SEVERANCE PAY.
(a) Xxxxxx and Ventiv agree that, with respect to individuals who,
in connection with the Distribution, cease to be employees of the Xxxxxx
Group and become employees of the Healthcare Services Group, such cessation
shall not be deemed a severance of employment from either Group for
purposes of any Plan that provides for the payment of severance, salary
continuation or similar benefits and shall, if and to the extent
appropriate, in connection with the Distribution obtain waivers from
individuals against any such assertion.
(b) The Xxxxxx Group shall assume and be solely responsible for all
liabilities and obligations whatsoever in connection with claims made by or
on behalf of Xxxxxx Individuals and the Healthcare Services Group shall
assume and be solely responsible for all liabilities and obligations
whatsoever in connection with claims made by or on behalf of Healthcare
Services Individuals in respect of severance pay, salary continuation and
similar obligations relating to the termination or alleged termination of
any such person's employment either before, to the extent unpaid, or on or
after the Distribution Date.
7.07 [INTENTIONALLY OMITTED].
7.08 POST-DISTRIBUTION LIABILITIES. The Xxxxxx Group shall be solely
responsible for the payment of all liabilities and obligations whatsoever
arising with respect to any Xxxxxx Individual and attributable to any period
subsequent to the Distribution Date and the Healthcare Services Group shall be
solely responsible for the payment of all liabilities and obligations whatsoever
arising with respect to any Healthcare Services Individual and attributable to
any period subsequent to the Distribution Date.
7.09 OTHER BALANCE SHEET ADJUSTMENTS. To the extent not otherwise provided
in this Agreement, Xxxxxx and Ventiv shall take such action as is necessary to
effect an adjustment to the books of Xxxxxx and Ventiv so that, as of the
Distribution Date, the prepaid expense balances and accrued employee liabilities
with respect to any employee liability or obligation assumed or retained as of
the Distribution Date by the Xxxxxx Group and the Healthcare Services Group are
appropriately reflected on the consolidated balance sheets as of the
Distribution Date of Xxxxxx and Ventiv, respectively.
7.10 PRESERVATION OF RIGHTS TO AMEND OR TERMINATE PLANS. No provisions of
this Agreement, including the agreement of Xxxxxx or Ventiv that it, or any
member of the Xxxxxx Group or the Healthcare Services Group, respectively, will
make a contribution or payment to or under any Plan herein referred to for any
period, shall be construed as a limitation on the right of Xxxxxx or Ventiv or
any member of the Xxxxxx Group or the Healthcare Services Group to amend such
Plan or terminate its participation therein which Xxxxxx or Ventiv or any member
of the Xxxxxx Group or the Healthcare Services Group, respectively, would
otherwise have under the terms of such
23
Plan or otherwise, and no provision of this Agreement shall be construed to
create a right in any employee or former employee or beneficiary of such
employee or former employee under a Plan which such employee or former employee
or beneficiary would not otherwise have under the terms of the Plan itself.
7.11 REIMBURSEMENT; INDEMNIFICATION. Each of the parties hereto
acknowledges that the Xxxxxx Group, on the one hand, and the Healthcare Services
Group, on the other hand, may incur costs and expenses (including contributions
to Plans and the payment of insurance premiums) arising from or related to any
of the Plans which are, as set forth in this Agreement, the responsibility of
the other party hereto. Accordingly, Xxxxxx and Ventiv agree to reimburse each
other, as soon as practicable but in any event within thirty (30) days of
receipt from the other party of appropriate verification, for all such costs and
expenses reduced by the amount of any tax reduction or recovery of tax benefit
realized by Xxxxxx or Ventiv, as the case may be, in respect of the
corresponding payment made by it; provided, however, that notwithstanding
-------- -------
anything in this Section 7.11 to the contrary, costs and expenses or other
recovery arising from any challenge by the U.S. Government to the allocation of
assets set forth in Section 7.01 shall not be subject to reimbursement, and
indemnification under this Agreement or the Distribution Agreement.
7.12 FURTHER TRANSFERS. Xxxxxx and Ventiv recognize that there may be
Healthcare Services Individuals who will, after the Distribution Date, become
employed by Xxxxxx and there may be Xxxxxx Individuals who become employed,
after the Distribution Date, by Ventiv. If Xxxxxx and Ventiv so agree with
respect to any such individuals, the assets and liabilities with respect to such
employees which are associated with the Plans and programs described in this
Agreement may be transferred and assumed in a manner consistent with this
Agreement. Any such transfers or assumptions will be considered to be governed
by the terms of this Agreement and shall not require the agreement of Xxxxxx and
Ventiv if they occur within three (3) months of the Distribution Date.
7.13 OFFICERS AND EMPLOYEES.
(a) Except for officers of Ventiv who are also officers of Xxxxxx,
officers and employees of either Group who are employed in the Healthcare
Services Business immediately prior to the Distribution Date shall be
officers and employees of the Healthcare Services Group immediately
following the Distribution Date; provided, however, that nothing herein
-------- -------
shall give to any individual a right of employment, or continued
employment, by any member of the Healthcare Services Group.
(b) Except as otherwise agreed by the parties hereto, effective as
of the Distribution Date, (1) all officers or employees of the Xxxxxx Group
who are acting as directors or officers of the Healthcare Services Group
and are not employed in the Healthcare Services Business shall resign from
such positions with the Healthcare Services Group and (2) all officers or
employees of the
24
Healthcare Services Group who are acting as directors or officers of the
Xxxxxx Group and are not employed in the Xxxxxx Business shall resign from
such positions with the Xxxxxx Group.
7.14 EMPLOYMENT AGREEMENTS. Prior to the Distribution Date, Xxxxxx and
Ventiv shall use their best efforts to induce such individuals as they mutually
agree to enter into employment agreements with Ventiv on terms which are
mutually agreeable to Xxxxxx and Ventiv; provided, however, that, except as
-------- -------
otherwise provided in this Agreement, Xxxxxx shall have no obligation to make
any payments to such individuals to induce them to enter into such employment
agreements.
7.15 OTHER LIABILITIES. As of the Distribution Date: (a) Ventiv shall
assume and be solely responsible for all Liabilities whatsoever of the Xxxxxx
Group with respect to claims made by the Healthcare Services Individuals
relating to any employment-related Liability not otherwise expressly provided
for in this Agreement, including earned salary, wages, severance payments or
other compensation and accrued holiday, vacation, health, dental or retirement
benefits, regardless of whether such employment-related Liability was incurred
before, on or after the Distribution Date, and (b) Xxxxxx shall retain all such
Liabilities with respect to (1) Xxxxxx Individuals and (2) directors of Xxxxxx
who served as such prior to the Distribution Date.
7.16 COMPLIANCE. Notwithstanding anything to the contrary in this Article
VII, to the extent any actions of the parties contemplated in this Article are
determined prior to Distribution to violate applicable law or result in
unintended tax liability for Xxxxxx Individuals or Healthcare Services
Individuals, such action may be modified to avoid such violation of law or
unintended tax liability.
ARTICLE VIII
NO REPRESENTATIONS OR WARRANTIES; EXCEPTIONS
8.01 NO REPRESENTATIONS OR WARRANTIES; EXCEPTIONS. Ventiv understands and
agrees that no member of the Xxxxxx Group is, in this Agreement or in any other
agreement or document, representing or warranting to Ventiv in any way as to the
Healthcare Services Assets, the Healthcare Services Liabilities, or the
Healthcare Services Business or as to any consents or approvals required in
connection with the consummation of the transactions contemplated by this
Agreement, it being agreed and understood that Ventiv shall take all of the
Healthcare Services Assets "as is, where is" and that, except as provided in
Section 5.01 hereof, Ventiv shall bear the economic and legal risk that
conveyances of the Healthcare Services Assets shall prove to be insufficient or
that the title of any member of the Healthcare Services Group to any Healthcare
Services Assets shall be other than good and marketable and free from
encumbrances.
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ARTICLE IX
INSURANCE
9.01 INSURANCE POLICIES AND RIGHTS INCLUDED WITHIN HEALTHCARE SERVICES
ASSETS. Without limiting the generality of the definition of Healthcare Services
Assets set forth in Section 1.01 hereof, the Healthcare Services Assets shall
include (a) any and all rights of an insured party under each of the Xxxxxx
Policies, including rights of indemnity and the right to be defended by or at
the expense of the insurer, with respect to all Healthcare Services Claims;
provided, however, that nothing in this clause (a) shall be deemed to constitute
-------- -------
(or to reflect) the assignment of any of the Xxxxxx Policies to Ventiv, and (b)
the Healthcare Services Policies. Ventiv shall be entitled to receive from
Xxxxxx any Insurance Proceeds paid to any member of the Xxxxxx Group with
respect to any third-party Healthcare Services Claim under any Xxxxxx Policy.
9.02 POST-DISTRIBUTION DATE CLAIMS. If, subsequent to the Distribution
Date, any Person shall assert a Healthcare Services Claim, then Xxxxxx shall at
the time such Healthcare Services Claim is asserted be deemed to assign, without
need of further documentation, to Ventiv all of the Xxxxxx Group's rights, if
any, as an insured party under the applicable Xxxxxx Policy with respect to such
Healthcare Services Claim, including rights of indemnity and the right to be
defended by or at the expense of the insurer; provided, however, that nothing in
-------- -------
this Section 9.02 shall be deemed to (1) constitute (or to reflect) the
assignment of any of the Xxxxxx Policies to Ventiv or (2) affect the Xxxxxx
indemnity set forth in Section 4.03 of this Agreement.
9.03 ADMINISTRATION AND RESERVES. Notwithstanding the provisions of
Article IV hereof, from and after the Distribution Date:
(a) Xxxxxx shall be responsible for (1) Insurance Administration
with respect to the Xxxxxx Policies and (2) Claims Administration with
respect to any Liabilities of Xxxxxx; provided, however, that the retention
-------- -------
of the Xxxxxx Policies by Xxxxxx is in no way intended to limit, inhibit or
preclude any right to insurance coverage for any Insured Claim of a named
insured under the Xxxxxx Policies;
(b) Ventiv shall be responsible for (1) Insurance Administration
with respect to the Healthcare Services Policies, and (2) Claims
Administration with respect to any Liabilities of Ventiv; provided,
--------
however, that the retention of the Healthcare Services Policies by Ventiv
-------
is in no way intended to limit, inhibit or preclude any right to insurance
coverage for any Insured Claim of a named insured under the Healthcare
Services Policies;
(c) Xxxxxx shall be entitled to reserves established by any member
of either Group, or the benefit of reserves held by any insurance carrier,
with respect to any Xxxxxx Liabilities; and
26
(d) Ventiv shall be entitled to reserves established by any member
of either Group, or the benefit of reserves held by any insurance carrier,
with respect to any Healthcare Services Liabilities.
9.04 INSURANCE PREMIUMS. Ventiv shall pay premiums (retrospectively-rated
or otherwise) under the Xxxxxx Policies with respect to Healthcare Services
Liabilities which are Insured Claims under the Xxxxxx Policies. Xxxxxx shall
have the right, but not the obligation, to pay premiums (retrospectively-rated
or otherwise) under the Xxxxxx Policies with respect to Healthcare Services
Liabilities which are Insured Claims under the Xxxxxx Policies to the extent
that Ventiv does not pay such premiums, whereupon Ventiv shall forthwith
reimburse Xxxxxx for any premiums paid by Xxxxxx with respect to such Healthcare
Services Liabilities.
9.05 ALLOCATION OF INSURANCE PROCEEDS; COOPERATION. Insurance Proceeds
received with respect to claims, costs and expenses under the Insurance Policies
shall be paid to Xxxxxx with respect to Xxxxxx Liabilities which are Insured
Claims under the Xxxxxx Policies and to Ventiv with respect to the Healthcare
Services Liabilities which are Insured Claims under the Xxxxxx Policies.
Payment of the allocable portions of indemnity costs of Insurance Proceeds
resulting from the Liability Policies will be made to the appropriate party upon
receipt from the insurance carrier. In the event of the exhaustion of coverage
under any Xxxxxx Policy, Xxxxxx and Ventiv shall allocate Insurance Proceeds
equitably based upon the bona fide claims of the Xxxxxx Group and the Healthcare
Services Group, respectively. The parties hereto agree to use their best
efforts to cooperate with respect to insurance matters.
9.06 REIMBURSEMENT OF EXPENSES. Ventiv shall (a) upon the request of
Xxxxxx, reimburse the relevant insurer of the relevant third-party
administrator, to the extent required under any Insurance Policy or Service
Agreement with respect to any and all Healthcare Services Claims which are paid,
settled, adjusted, defended and/or otherwise handled by such insurer or third-
party administrator pursuant to the terms and conditions of such Insurance
Policy or Service Agreement and (b) to the extent the cost incurred exceeds
internal charges made by Xxxxxx to Ventiv prior to the Distribution Date, pay
and/or reimburse Xxxxxx, or such third party as Xxxxxx may require, for any and
all costs, premiums, expenses, losses paid, attorneys' fees and/or charges
incurred prior to the Distribution Date by either Group or after the
Distribution Date by the Xxxxxx Group arising directly or indirectly in
connection with the payment, settlement, adjustment, defense and/or handling of
any such Healthcare Services Claim or under the terms and conditions of any
Insurance Policies or Service Agreements (including any reimbursement paid by
Xxxxxx with respect to any such Healthcare Services Claim to any insurer or
third-party administrator pursuant to the terms of any Insurance Policy or
Service Agreement). Ventiv shall make any reimbursement required by clause (a)
of this Section 9.06 at the time required by the relevant Insurance Policy or
Service Agreement. Ventiv shall make any reimbursement required by clause (b) of
this Section 9.06, on a monthly basis.
27
9.07 INSURER INSOLVENCY. Xxxxxx shall not be obligated to reimburse Ventiv
for any Healthcare Services Claim under any Insurance Policies where such
Healthcare Services Claim would have been paid by the insurer or other third
party, but for the insolvency of such insurer or other third party or the
refusal by any insurer or other third party to pay such Healthcare Services
Claim.
9.08 LETTERS OF CREDIT. Ventiv shall post such letters of credit in favor
of such Persons as Xxxxxx may reasonably request for any amounts due or
reasonably expected to come due under Section 9.06 hereof. Ventiv shall make
reasonable efforts to negotiate agreements with any and all insurers or third-
party administrators whereby Ventiv shall assume direct responsibility for any
and all Liabilities related to it under any Insurance Policies and/or Service
Agreements and Xxxxxx shall provide reasonable assistance in this effort.
9.09 NO REDUCTION OF COVERAGE. Xxxxxx shall take no action to eliminate or
materially reduce coverage under any Xxxxxx Policy or Service Agreement for any
Healthcare Services Claim.
9.10 FUTURE INSURANCE COVERAGE. For a period of one (1) year following the
Distribution Date, Xxxxxx shall assist Ventiv, to the extent reasonably
requested by Ventiv, with the efforts of the Healthcare Services Group to secure
alternative insurance coverage or claim handling services.
9.11 ASSISTANCE, WAIVER OF CONFLICT AND SHARED DEFENSE. Each of the
parties hereto agrees to provide reasonable assistance to the other parties
hereto as regards any dispute with any third party (including insurers, third-
party administrators and state guaranty funds) as to any matter related to the
Insurance Policies or Service Agreements, but only insofar as such dispute
arises out of the acts or omissions of any third party with respect to a
Healthcare Services Claim. In the event that Insured Claims of more than one
Group exist relating to the same occurrence, the parties hereto agree to defend
such Insured Claims jointly and to waive any conflict of interest necessary to
the conduct of such joint defense. Nothing in this Section 9.11 shall be
construed to limit or otherwise alter in any way the indemnity obligations of
the parties hereto, including those created by this Agreement or by operation of
law.
ARTICLE X
MISCELLANEOUS
10.01 CONDITIONS TO OBLIGATIONS.
(a) The obligations of the parties hereto to consummate the payment
of the Distribution are subject to the satisfaction of each of the
following conditions:
28
(1) The transactions contemplated by Sections 2.01, 2.02,
2.03, 2.05 and 2.06 shall have been consummated in all material
respects;
(2) The Ventiv Common Stock shall have been approved for
listing on the Nasdaq, subject to official notice of issuance;
(3) The Registration Statement shall have been filed with the
SEC and shall have become effective, and no stop order with respect
thereto shall be in effect;
(4) All authorizations, consents, approvals and clearances of
all federal, state, local and foreign governmental agencies required
to permit the valid consummation by the parties hereto of the
transactions contemplated by this Agreement shall have been
obtained; and no such authorization, consent, approval or clearance
shall contain any conditions which would have a material adverse
effect on (A) the Xxxxxx Business or the Healthcare Services
Business, (B) the Assets, results of operations or financial
condition of the Xxxxxx Group or the Healthcare Services Group, in
each case taken as a whole, or (C) the ability of Xxxxxx or Ventiv
to perform its obligations under this Agreement; and all statutory
requirements for such valid consummation shall have been fulfilled;
(5) Xxxxxx shall have provided the NYSE with the prior written
notice of the Record Date required by Rule 10b-17 of the Exchange
Act and the rules and regulations of the NYSE;
(6) No preliminary or permanent injunction or other order,
decree or ruling issued by a court of competent jurisdiction or by a
government, regulatory or administrative agency or commission, and
no statute, rule, regulation or executive order promulgated or
enacted by any governmental authority, shall be in effect preventing
the payment of the Distribution;
(7) The Distribution shall be payable in accordance with
applicable law;
(8) All necessary consents, waivers or amendments to each bank
credit agreement, debt security or other financing facility to which
any member of the Xxxxxx Group or the Healthcare Services Group is a
party or by which any such member is bound shall have been obtained,
or each such agreement, security or facility shall have been
refinanced, in each case on terms satisfactory to Xxxxxx and Ventiv
and to the extent necessary to permit the Distribution to be
consummated without any material breach of the terms of such
agreement, security or facility;
29
(9) Xxxxxx shall have received an opinion from Xxxxxx Xxxxxxxx
LLP, substantially in the form attached hereto as Exhibit E, that
the Distribution should be tax-free to Xxxxxx and to U.S.
stockholders of Xxxxxx Common Stock;
(10) One or more of members of the Healthcare Services Group
shall have been substituted, as of the Distribution Date, in all
respects for the Xxxxxx Group in respect of all Healthcare Services
Support Agreements.
(b) Any determination made by the Board of Directors of Xxxxxx in
good faith prior to the Distribution Date concerning the satisfaction or
waiver of any or all of the conditions set forth in Section 10.01(a) shall
be conclusive.
10.02 COMPLETE AGREEMENT. This Agreement, the Exhibits and Schedules
hereto and the agreements and other documents referred to herein shall
constitute the entire agreement between the parties hereto with respect to the
subject matter hereof and shall supersede all previous negotiations, commitments
and writings with respect to such subject matter.
10.03 EXPENSES. Except as otherwise provided in this Agreement and the
Other Agreements, all costs and expenses of any party hereto in connection with
the preparation, execution, delivery and implementation of this Agreement and
with the consummation of the transactions contemplated by this Agreement shall
be paid by the party for whose benefit such costs and expenses are incurred,
with any costs and expenses that cannot be allocated on the foregoing basis to
be divided equally among the parties hereto.
10.04 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York (other than the laws regarding
choice of laws and conflicts of laws) as to all matters, including matters of
validity, construction, effect, performance and remedies.
10.05 NOTICES. All notices requests, claims, demands and other
communications hereunder (collectively, "Notices") shall be in writing and shall
be given (and shall be deemed to have been duly given upon receipt) by delivery
in person, by cable, telegram, telex or other standard form of
telecommunications, or by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
If to Xxxxxx:
Xxxxxx Communications, Inc.
Two Democracy Center
0000 Xxxxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
30
If to Ventiv:
Ventiv Health, Inc.
000 Xxxxxxxxxx Xxxx
Xxxxxxx Xxxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Chief Executive Officer
or to such other address as any party hereto may have furnished to the other
parties by a notice in writing in accordance with this Section 10.05. Copies of
all notices, requests, claims, demands and other communications hereunder shall
also be given to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
10.06 AMENDMENT AND MODIFICATION. This Agreement may be amended, modified
or supplemented only by a written agreement signed by all of the parties hereto.
10.07 SUCCESSORS AND ASSIGNS; NO THIRD-PARTY BENEFICIARIES. This Agreement
and all of the provisions hereof shall be binding upon and inure to the benefit
of the parties hereto and their successors and permitted assigns, but neither
this Agreement nor any of the rights, interests and obligations hereunder shall
be assigned by any party hereto without the prior written consent of each of the
other parties (which consent shall not be unreasonably withheld). Except for the
provisions of Sections 4.03 and 4.04 hereof relating to Indemnities, which are
also for the benefit of the Indemnitees, this Agreement is solely for the
benefit of the parties hereto and their Subsidiaries and Affiliates and is not
intended to confer upon any other Persons any rights or remedies hereunder.
10.08 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.09 INTERPRETATION. The Article and Section headings contained in this
Agreement are solely for the purpose of reference, are not part of the agreement
of the parties hereto and shall not in any way affect the meaning or
interpretation of this Agreement.
10.10 LEGAL ENFORCEABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. Each party
31
acknowledges that money damages would be an inadequate remedy for any breach of
the provisions of this Agreement and agrees that the obligations of the parties
hereunder shall be specifically enforceable.
10.11 REFERENCES; CONSTRUCTION. References to any "Article", "Exhibit",
"Schedule" or "Section", without more, are to Appendices, Articles, Exhibits,
Schedules and Sections to or of this Agreement. Unless otherwise expressly
stated, clauses beginning with the term "including" set forth examples only and
in no way limit the generality of the matters thus exemplified.
10.12 TERMINATION. Notwithstanding any provision hereof this Agreement may
be terminated and the Distribution abandoned at any time prior to the
Distribution Date by and in the sole discretion of the Board of Directors of
Xxxxxx without the approval of any other party thereto or of Xxxxxx'x
stockholders. In the event of such termination, no party hereto shall have any
Liability to any Person by reason of this Agreement.
32
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
XXXXXX COMMUNICATIONS, INC.,
a Delaware corporation
By:
----------------------------
Name:
Title:
VENTIV HEALTH, INC.,
a Delaware corporation
By:
----------------------------
Name:
Title:
33
