EXHIBIT 2.1
DISTRIBUTION AGREEMENT
PLAN OF REORGANIZATION AND DISTRIBUTION
DISTRIBUTION AGREEMENT ("Agreement") dated as of __________ ___, 2001 by
and between Equifax Inc., a Georgia corporation ("Equifax"), and Certegy Inc., a
Georgia corporation ("Certegy").
RECITALS
A. Certegy is a wholly-owned subsidiary of Equifax formed for the purpose
of taking title to the stock of certain Equifax subsidiaries, the assets and
liabilities of which constitute the businesses of Equifax's Payment Services
Group ("PSG").
B. The Board of Directors of Equifax has determined that it is in the best
interests of Equifax and its shareholders to transfer and assign to Certegy
effective at and after the Effective Time (as defined herein) and as a
contribution to the capital of Certegy, the capital stock of the Equifax
subsidiaries that currently operate the PSG businesses and certain related
assets and to receive in exchange therefor shares of Certegy Common Stock and
the Borrowing Proceeds (each as defined herein).
C. The Board of Directors of Equifax has further determined that it is in
the best interests of Equifax and its shareholders to make a distribution (the
"Distribution") to the holders of Equifax Common Stock (as defined herein) of
all of the outstanding shares of Certegy Common Stock at the rate of one share
of Certegy Common Stock for every two shares of Equifax Common Stock outstanding
as of the Record Date (as defined herein).
D. The parties intend that the Contribution constitute a reorganization
described in Section 368(a)(1)(D) of the Code (as defined herein) and that the
Distribution not be taxable to Equifax or its shareholders pursuant to Section
355 of the Code.
E. The parties have determined that it is necessary and desirable to set
forth the principal corporate transactions required to effect the Contribution
and the Distribution and to set forth other agreements that will govern certain
other matters following the Distribution.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
agreements and covenants contained in this Agreement and other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. As used herein, the following terms have the
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following meaning:
"Action" means any claim, suit, arbitration, inquiry, proceeding, or
investigation by or before any court, governmental or other regulatory or
administrative agency or commission or any other tribunal.
"Agreement Regarding Leases" means the Agreement Regarding Leases entered
into at or prior to the Effective Time among Equifax, Payment Services, and the
other entities entering into such agreement, as amended from time to time.
"Ancillary Agreements" means all of the written agreements, instruments,
understandings, assignments and other arrangements (other than this Agreement)
entered into in connection with the transactions contemplated hereby, including,
without limitation, the Employee Benefits Agreement, the Transition Support
Agreement, the Intercompany Data Purchase Agreement, the Intellectual Property
Agreement, the Tax Sharing and Indemnification Agreement, the Real Estate
Agreements, Agreement Regarding IBM UK Mainframe Services, Agreement Regarding
IBM Australian Mainframe and Network Services, US and UK Network Services
"Authorized User" Agreement, IBM United Kingdom Limited Transition Services
Agreement, Agreement Regarding IBM Canadian Data Center Services Agreement and
other documents relating to the transfer of assets and liabilities in
contemplation of the Contribution and Distribution.
"Applicable Rate" means the Prime Rate plus 2%.
"Assets" means all properties, rights, contracts, leases and claims, of
every kind and description, wherever located, whether tangible or intangible,
and whether real, personal or mixed.
"Borrowing Proceeds" means proceeds from the Certegy Revolving Credit
Agreement in the amount of $275,000,000.
"Brazil Agreements" means the agreements, assignments and documents
relating to the transfer by Equifax do Brasil Holdings, Ltd. of its ownership
interests in Xxxxxx-Solucoes em Meios de Pagamento Ltda., Partech Ltd., and
Equifax Cayman Islands Ltd. to Payment Brasil Holdings Ltda.
"Card Solutions France" means Equifax Card Solutions S.A., a wholly-owned
subsidiary of Equifax organized under the laws of France.
"Certegy Articles" means the articles of incorporation of Certegy in the
form filed as an exhibit to the Form 10 at the time it becomes effective.
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"Certegy Assets" means (a) the capital stock of Payment Services, FSB,
Telecredit Canada, Card Solutions France, Equifax Asia Pacific and Payment U.K.
to be transferred at or prior to the Distribution Date by Equifax to Certegy,
(b) the Real Estate Assets, and (c) except as otherwise provided in an Ancillary
Agreement, all Assets that are (i) owned of record or held in the name of a
member of the Certegy Group on the Distribution Date, (ii) treated for internal
financial reporting purposes of Equifax prior to the Distribution Date or on the
PSG Balance Sheet as owned by a member of the Certegy Group, (iii) on the
Distribution Date used exclusively by one or more members of the Certegy Group,
or (iv) transferred to a member of the Certegy Group pursuant to any Ancillary
Agreement.
"Certegy Business" means the businesses now or formerly conducted by PSG,
including the businesses of providing payment transaction processing and check
risk management services to financial institutions and merchants.
"Certegy Bylaws" means the bylaws of Certegy in the form filed as an
exhibit to the Form 10 at the time it becomes effective.
"Certegy Common Stock" means the outstanding shares of common stock, $.01
par value, of Certegy.
"Certegy Group" means Certegy, Payment Services, FBS, Telecredit Canada,
Card Solutions France, Equifax Asia Pacific, Payment U.K., any of their
respective subsidiaries and any subsidiary or division of any member of the
Equifax Group that is included in the assets of the Certegy Business as
reflected in the pro forma combined balance sheet of Certegy as of March 31,
2001 contained in the Information Statement.
"Certegy Liabilities" means (a) Liabilities of any member of the Certegy
Group under this Agreement or any Ancillary Agreement, (b) except as otherwise
expressly provided in this Agreement or any Ancillary Agreement, Liabilities
incurred in connection with the conduct or operation of the Certegy Business
(including any acquired businesses) or the ownership or use of the Certegy
Assets, whether arising before, at or after the Effective Time, (c) Liabilities
arising under or in connection with the Form 10, except to the extent such
Liabilities arise out of or are based upon information about Equifax included in
the sections of the Information Statement attached as Exhibit 99.1 to the Form
10 entitled "Summary - Our Business," "Summary - The Distribution," and "The
Distribution - Reasons for the Distribution," (d) except as otherwise expressly
provided in this Agreement or any Ancillary Agreement, Liabilities set forth on
the PSG Balance Sheet, (e) except as otherwise provided in this Agreement or any
Ancillary Agreement, Liabilities of the Equifax Group or the Certegy Group
relating to a Sold PSG Business or arising out of the sale thereof, and (f) any
Liabilities relating to or arising out of the acquisition (whether through an
acquisition of stock or assets or a merger, share exchange or other form of
business combination) of any business prior to the Effective Time by any member
of the Certegy Group, except to the extent such Liabilities arise out of or are
based upon the issuance of securities of Equifax in any such business
combination transaction.
"Certegy Revolving Credit Agreement" means the Revolving Credit Agreement
among various lenders and Certegy, which provides for borrowing of the Borrowing
Proceeds for the purpose of making the payment provided for in Section 2.01.
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"Chile Agreements" means that agreements, assignments and documents
relating to the transfer by Equifax de Chile, S.A. of its ownership interests in
Procard S.A. to Payment Chile S.A.
"Code" means the United States Internal Revenue Code of 1986, as amended.
"Commission" means Securities and Exchange Commission.
"Contribution" is defined in Section 2.01.
"Distribution" is defined in the recitals to this Agreement.
"Distribution Agent" means SunTrust Bank, Atlanta, in its capacity as agent
for Equifax in connection with the Distribution.
"Distribution Date" means the date upon which the Distribution shall be
effective, as determined by the Board of Directors of Equifax, or such committee
of such Board of Directors as shall be designated by the Board of Directors of
Equifax.
"Effective Time" means 11:59 p.m. Atlanta time on June 30, 2001.
"EIS" means Equifax Information Services, LLC, a wholly-owned subsidiary of
Equifax organized under the laws of the State of Georgia, formerly known as
Equifax Credit Information Services, Inc.
"Employee Benefits Agreement" means the Employee Benefits Agreement entered
into at or prior to the Effective Time between Equifax and Certegy, as amended
from time to time.
"Equifax Asia Pacific" means Equifax Asia Pacific Holdings Inc., a wholly-
owned subsidiary of Equifax organized under the laws of the State of Georgia.
"Equifax Business" means the business now or formerly conducted by Equifax
and its present and former subsidiaries, joint ventures and partnerships, other
than the Certegy Business.
"Equifax Common Stock" means the outstanding shares of common stock, $1.25
par value, of Equifax.
"Equifax Group" means Equifax and its subsidiaries, joint ventures and
partnerships, excluding any member of the Certegy Group.
"Equifax Liabilities" means (i) Liabilities of any member of the Equifax
Group under this Agreement or any Ancillary Agreement, and (ii) Liabilities,
other than Certegy Liabilities, incurred in connection with the operation of the
Equifax Business, whether arising before, at, or after the Effective Time.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"FBS" means First Bankcard Systems, Inc., a wholly-owned subsidiary of
Equifax organized under the laws of the State of Georgia.
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"Form 10" means the registration statement on Form 10 filed by Certegy with
the Commission to effect the registration of the Certegy Common Stock pursuant
to the Exchange Act, as such registration statement may be amended from time to
time.
"Group" means the Equifax Group or the Certegy Group, as the context so
requires.
"Guaranteed Certegy Liabilities" means the Certegy Liabilities on which any
member of the Equifax Group is an obligor by reason of any guarantee or
contractual commitment, including Liabilities under any contract assumed by any
member of the Certegy Group from any member of the Equifax Group with respect to
which any member of the Equifax Group remains liable.
"Guaranteed Equifax Liabilities" means the Equifax Liabilities on which any
member of the Certegy Group is an obligor by reason of any guarantee or
contractual commitment, including Liabilities under any contract assumed by any
member of the Equifax Group from any member of the Certegy Group with respect to
which any member of the Certegy Group remains liable.
"Indemnifiable Loss" means any and all damage, loss, liability, and expense
(including, without limitation, reasonable expenses of investigation and
reasonable attorneys' fees and expenses) in connection with any and all Actions
or threatened Actions.
"Information Statement" means the information statement required by the
Commission to be sent to each holder of Equifax Common Stock in connection with
the Distribution, and prepared in accordance with the Exchange Act.
"Intellectual Property Agreement" means the Intellectual Property Agreement
entered into at or prior to the Effective Time between Equifax and Certegy, as
amended from time to time.
"Intercompany Data Purchase Agreement" means the Intercompany Data Purchase
Agreement entered into at or prior to the Effective Time between Equifax and
Certegy, as amended from time to time.
"IRS" means the United States Internal Revenue Service.
"Liabilities" means any and all claims, debts, liabilities and obligations,
absolute or contingent, matured or not matured, liquidated or unliquidated,
accrued or unaccrued, known or unknown, whenever arising, including all costs
and expenses relating thereto, and including, without limitation, those debts,
liabilities and obligations arising under this Agreement or any Ancillary
Agreement, any law, rule, regulation, action, order or consent decree of any
governmental entity or any award of any arbitrator of any kind, and those
arising under any contract, commitment or undertaking.
"Payment Services" means Equifax Payment Services Inc., a wholly-owned
subsidiary of Equifax organized under the laws of the State of Delaware.
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"Payment U.K." means Payment U.K. Ltd., a wholly-owned subsidiary of
Equifax organized under the laws of England and Wales.
"Prime Rate" means the rate of interest announced by SunTrust Bank from
time to time as its "prime rate," "prime lending rate," "base rate" or similar
reference rate. In the event the Prime Rate is discontinued as a standard, the
parties, by mutual agreement, shall designate a comparable reference rate as a
substitute therefor. For purposes hereof, the Prime Rate in effect at the close
of business on each business day of SunTrust Bank, Atlanta, Georgia shall be the
Prime Rate for that day and any immediately succeeding non-business day or days.
"PSG Balance Sheet" means the consolidated balance sheet of the Certegy
Group as of the Effective Time, which balance sheet shall be prepared by Equifax
on a basis consistent with Equifax's historical practices for the preparation of
monthly divisional balance sheets.
"Rabbi Trusts" means the trusts established by Equifax pursuant to that
certain Grantor Trust Agreement dated as of February 4, 2000, as amended, and
the trust established by Equifax pursuant to that certain Trust Agreement dated
December 29, 1989, as amended.
"Real Estate Agreements" means all deeds, subleases, releases, assignments,
consents and agreements (including without limitation the Agreement Regarding
Leases) relating to the conveyance to Certegy of the Real Estate Assets and the
division of real property and interests therein between members of the Equifax
Group and members of the Certegy Group entered into as of or prior to the
Distribution Date, in each case as amended from time to time.
"Real Estate Assets" means the real estate owned by the Equifax Group and
used by PSG that is to be conveyed to PSG pursuant to the Real Estate
Agreements.
"Record Date" means the date designated by or under the authority of
Equifax's Board of Directors as the record date for determining the shareholders
of Equifax entitled to receive the Distribution.
"Securities Act" means the Securities Act of 1933, as amended.
"Services Agreements" means the Transition Support Agreement, Agreement
Regarding IBM UK Mainframe Services, Agreement Regarding IBM Australian
Mainframe and Network Services, US and UK Network Services "Authorized User"
Agreement, IBM United Kingdom Limited Transition Services Agreement, and
Agreement Regarding IBM Canadian Data Center Services Agreement.
"Sold PSG Business" means any of the Assets or businesses related to the
Certegy Business formerly owned, directly or indirectly, by Equifax and
heretofore sold.
"Stock Benefit Trust" means the Trust Agreement between Equifax and
Wachovia Bank of North Carolina, N.A. dated July 7, 1993.
"Tax" shall have the meaning given to such term in the Tax Sharing and
Indemnification Agreement.
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"Tax Sharing and Indemnification Agreement" means the Tax Sharing and
Indemnification Agreement entered into at or before the Effective Time between
Equifax and Certegy, as amended from time to time.
"Telecredit Canada" means Telecredit Canada, Inc., a wholly-owned
subsidiary of Equifax organized under the laws of Canada.
"Transition Support Agreement" means the Transition Support Agreement
entered into at or prior to the Effective Time between Equifax and Certegy, as
amended from time to time.
ARTICLE II
REORGANIZATION; CONVEYANCE OF CERTAIN ASSETS;
ASSUMPTION OF CERTAIN LIABILITIES;
CERTAIN PAYMENTS; AND TRANSITION ARRANGEMENTS
Section 2.01. Reorganization. On or prior to the Distribution Date and
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effective as of the Effective Time, Equifax shall contribute to Certegy all of
the Certegy Assets in exchange for (i) the Borrowing Proceeds and (ii) a number
of shares of Certegy Common Stock that when combined with the shares of Certegy
Common Stock already owned by Equifax shall equal all the shares to be
distributed as provided in Section 3.03 below (the "Contribution").
Section 2.02. Conveyance of Assets; Discharge of Liabilities. Except as
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otherwise expressly provided herein or in any of the Ancillary Agreements:
(a) Effective as of the Effective Time (i) all Certegy Assets are intended
to be and shall become Assets of the Certegy Group, (ii) all Certegy Liabilities
are intended to be and shall become the Liabilities of the Certegy Group, and
(iii) all other Assets and Liabilities of Equifax and its subsidiaries are
intended to be and shall remain exclusively the Assets and Liabilities of the
Equifax Group.
(b) Effective as of the Effective Time, Equifax agrees to transfer or cause
to be transferred to Certegy or to such other members of the Certegy Group as
Certegy may designate all right, title and interest of the Equifax Group in and
to all of the Certegy Assets.
(c) Certegy agrees that, effective as of the Effective Time, it will
transfer or cause to be transferred to Equifax or to such other member of the
Equifax Group as Equifax may designate all right, title and interest of the
Certegy Group in and to all Assets that are not Certegy Assets.
(d) Certegy agrees that it will, or will cause another member of the
Certegy Group designated by Certegy to, (i) assume any of the Certegy
Liabilities for which a member of the Certegy Group is not the obligor,
effective as of the Effective Time, and (ii) timely pay and discharge all of the
Certegy Liabilities, at and after the Effective Time.
(e) Equifax agrees that it will, or will cause another member of the
Certegy Group designated by Equifax to, (i) assume any of the Equifax
Liabilities for which a member of the Equifax Group is not the obligor,
effective as of the Effective Time, and (ii) timely pay and discharge all of the
Equifax Liabilities, at and after the Effective Time.
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(f) In the event that any conveyance of an Asset required hereby is not
effected at or before the Effective Time, the obligation to transfer such Asset
shall continue past the Effective Time and shall be accomplished as soon
thereafter as practicable.
(g) If any Asset may not be transferred by reason of the requirement to
obtain the consent of any third party and such consent has not been obtained by
the Effective Time, then (unless otherwise expressly agreed by Equifax and
Certegy) such Asset shall not be transferred until such consent has been
obtained, and Equifax and Certegy, as the case may be, shall cause the owner of
such Asset to use all reasonable efforts to provide to the appropriate member of
the other Group all the rights and benefits under such Asset and cause such
owner to enforce such Asset for the benefit of such member, in each case to the
extent that such action does not cause a breach or default under such Asset.
Both parties shall otherwise cooperate and use all reasonable efforts to provide
the economic and operational equivalent of an assignment or transfer of the
Asset as of the Effective Time.
(h) From and after the Effective Time, each party shall promptly transfer
or cause the members of its Group promptly to transfer to the other party or the
appropriate member of the other party's Group, from time to time, any property
received that is an Asset of the other party or a member of its Group. Without
limiting the foregoing, funds received by a member of one Group upon the payment
of accounts receivable that belong to a member of the other Group shall be
transferred to the other Group by wire transfer not more than five business days
after receipt of such payment.
(i) Except as expressly set forth in this Agreement, any Ancillary
Agreement, or any instrument or document contemplated by this Agreement or any
Ancillary Agreement, neither any member of the Equifax Group nor any member of
the Certegy Group has made or shall be deemed to have made any representation or
warranty as to (i) the Assets, business or Liabilities retained, transferred or
assumed as contemplated hereby or thereby, (ii) any consents or approvals
required in connection with the transfer or assumption by such party of any
Asset or Liability contemplated by this Agreement, (iii) the value or freedom
from any lien, claim, equity or other encumbrance of, or any other matter
concerning, any Assets of such party, (iv) the absence of any defenses or right
of setoff or freedom from counterclaim with respect to any claim or other Asset
of such party, or (v) the legal sufficiency of any assignment, document or
instrument delivered to convey title to any Asset transferred. EXCEPT AS MAY BE
EXPRESSLY SET FORTH IN THIS AGREEMENT OR ANY ANCILLARY AGREEMENT, ALL ASSETS
WERE, OR ARE BEING, TRANSFERRED, OR ARE BEING RETAINED, ON AN "AS IS," "WHERE
IS" BASIS AND THE RESPECTIVE TRANSFEREES WILL BEAR THE ECONOMIC AND LEGAL RISKS
THAT ANY CONVEYANCE OR OTHER TRANSFER SHALL PROVE TO BE INSUFFICIENT TO VEST IN
THE TRANSFEREE A TITLE THAT IS FREE AND CLEAR OF ANY LIEN, CLAIM, EQUITY OR
OTHER ENCUMBRANCE.
Section 2.03. Ancillary Agreements. As of the Effective Time, Equifax and
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Certegy (or their appropriate subsidiaries) will execute and deliver:
(a) A duly executed Employee Benefits Agreement;
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(b) A duly executed Tax Sharing and Indemnification Agreement;
(c) A duly executed Intercompany Data Purchase Agreement;
(d) A duly executed copy of each of the Services Agreements;
(e) A duly executed Intellectual Property Agreement;
(f) A duly executed copy of each of the Real Estate Agreements; and
(g) Such other agreements, leases, subleases, documents, or instruments as
the parties may agree are necessary or desirable in order to achieve the
purposes hereof.
Section 2.04. Issuance of Certegy Common Stock. On or before the
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Distribution Date, and in exchange for the transfer by Equifax to Certegy of the
stock and assets as provided above, and the surrender for reissue of all
certificates representing outstanding Certegy Common Stock, Certegy will issue
and deliver to Equifax a certificate representing shares of Certegy Common Stock
constituting all the shares to be distributed as provided in Section 3.03 below.
Section 2.05. Resignations.
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(a) On or before the Distribution Date, Certegy will deliver or cause to be
delivered to Equifax resignations of each person who will be an employee of
Certegy or another member of the Certegy Group from and after the Distribution
Date and who is an officer or director of Equifax or any of its subsidiaries or
affiliates not constituting a member of the Certegy Group immediately prior to
the Distribution Date, except for persons identified in the Information
Statement as continuing directors of Equifax or other members of the Equifax
Group.
(b) On or before the Distribution Date, Equifax will deliver or cause to be
delivered to Certegy resignations of each person who will be an employee of
Equifax or another member of the Equifax Group from and after the Distribution
Date and who is an officer or director of Certegy or any of its subsidiaries or
affiliates not constituting a member of the Equifax Group immediately prior to
the Distribution Date, except for persons identified in the Information
Statement as continuing directors of Certegy or other members of the Certegy
Group.
Section 2.06. Conduct of Certegy Pending Distribution.
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(a) Prior to the Distribution Date, Certegy shall not, without the prior
consent of Equifax, make any press release concerning the Distribution and shall
use its best efforts not to take any action which may prejudice or delay the
consummation of the Distribution. Prior to the Distribution Date, Certegy
further agrees regularly to apprise Equifax of public announcements to or the
dissemination of materials for financial analysts or other persons relating to
its business and the Distribution.
(b) Prior to the Distribution Date, the business of Certegy shall be
operated for the sole benefit of Equifax as Certegy's sole shareholder; provided
however, that upon
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consummation of the Distribution, the business of Certegy shall be deemed to
have been operated for the sole benefit of Certegy and its new shareholders, as
of and after the Effective Time. On the Distribution Date, (i) any amounts
advanced, incurred or contributed by any member of the Equifax Group to or for
the benefit of any member of the Certegy Group after the Effective Time (other
than amounts advanced or contributed to Certegy for costs or expenses to be paid
by Equifax in accordance with Section 15.01) shall be repaid by Certegy, in
addition to any payments prescribed by Section 8.03 hereof, and (ii) any amounts
advanced, incurred or contributed by any member of the Certegy Group to or for
the benefit of any member of the Equifax Group after the Effective Time shall be
repaid by Equifax, in addition to any payments prescribed by Section 8.03
hereof.
Section 2.07. Certegy Revolving Credit Agreement. Certegy shall use all
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reasonable efforts promptly to obtain, and to satisfy all conditions for
borrowing under the Certegy Revolving Credit Agreement in an amount sufficient
to allow Certegy to generate the Borrowing Proceeds and conduct the business of
Certegy after the Distribution Date.
Section 2.08. Guaranteed Certegy and Equifax Liabilities.
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(a) Certegy shall use all reasonable efforts (excluding payment of money or
incurrence of Liabilities) to obtain as promptly as practicable after the
Distribution Date the release of all members of the Equifax Group from any
obligations with respect to Guaranteed Certegy Liabilities. In no event shall
any member of the Certegy Group take any action with respect to any Guaranteed
Certegy Liabilities which could be reasonably expected to adversely affect the
Equifax Group members in any way including, without limitation, extending the
term of any Guaranteed Certegy Liabilities or increasing the liability
guaranteed thereunder, unless the guarantee or obligation of all Equifax Group
members is released as to any extended or modified liability obligations under
such Guaranteed Certegy Liabilities or Equifax otherwise consents in writing.
(b) Equifax shall use all reasonable efforts (excluding payment of money or
incurrence of Liabilities) to obtain as promptly as practicable after the
Distribution Date the release of all members of the Certegy Group from any
obligations with respect to Guaranteed Equifax Liabilities. In no event shall
any member of the Equifax Group take any action with respect to any Guaranteed
Equifax Liabilities which could be reasonably expected to adversely affect the
Certegy Group members in any way including, without limitation, extending the
term of any Guaranteed Equifax Liabilities or increasing the liability
guaranteed thereunder, unless the guarantee or obligation of all Certegy Group
members is released as to any extended or modified liability obligations under
such Guaranteed Equifax Liabilities or Certegy otherwise consents in writing.
(c) In the event that any Equifax Group member is required to pay or
otherwise satisfy any Guaranteed Certegy Liabilities, without limiting any of
Equifax's rights and remedies against Certegy under this Agreement or otherwise,
in order to secure Certegy's indemnity obligations to Equifax hereunder in
respect of such Guaranteed Certegy Liabilities, Equifax shall be entitled to all
the rights of the payee in any property of any member of the Certegy Group
pledged as security for such Guaranteed Certegy Liabilities.
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(d) In the event that Certegy Group member is required to pay or otherwise
satisfy any Guaranteed Equifax Liabilities, without limiting any of Certegy's
rights and remedies against Equifax under this Agreement or otherwise, in order
to secure Equifax's indemnity obligations to Certegy hereunder in respect of
such Guaranteed Equifax Liabilities, Certegy shall be entitled to all the rights
of the payee in any property of any member of the Equifax Group pledged as
security for such Guaranteed Equifax Liabilities.
Section 2.09. Insurance.
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(a) Following the Distribution, Certegy will use its best efforts to
procure and maintain directors' and officers' liability insurance coverage at
least equal to the amount of Equifax's current directors' and officers'
insurance coverage for a period of five (5) years from the Distribution Date
with respect to directors and officers of Equifax who are or will become
directors and officers of Certegy as of the Distribution Date for acts as
directors and officers of members of the Certegy Group for periods from and
after the Distribution Date.
(b) Following the Distribution, Equifax will use its best efforts to
maintain directors' and officers' liability insurance coverage at least equal to
the amount of Equifax's current directors' and officers' liability insurance
coverage for a period of five (5) years from the Distribution Date with respect
to the directors and officers of Equifax who are or will become directors and
officers of members of the Certegy Group as of the Distribution Date for acts as
directors and officers of members of the Equifax Group during periods prior to
the Distribution Date.
ARTICLE III
THE DISTRIBUTION
Section 3.01. Cooperation Prior to the Distribution.
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(a) Equifax and Certegy shall prepare, and Equifax shall mail to the
holders of Equifax Common Stock, the Information Statement, which shall set
forth appropriate disclosure concerning Certegy, the Distribution and any other
appropriate matters. Equifax and Certegy shall also prepare, and Certegy shall
file with the Commission, the Form 10, which shall include the Information
Statement. Equifax and Certegy shall use all reasonable efforts to cause the
Form 10 to become effective under the Exchange Act.
(b) Equifax shall, as the sole shareholder of Certegy, approve and adopt
the Certegy employee benefit plans contemplated by the Employee Benefits
Agreement and Equifax and Certegy shall cooperate in preparing, filing with the
Commission under the Securities Act and causing to become effective not later
than the Distribution Date any registration statements or amendments thereto
that are appropriate to reflect the establishment of or amendments to any
employee benefit plan of Certegy contemplated by the Employee Benefits
Agreement, including without limitation, a Form S-8 with respect thereto.
(c) Equifax and Certegy shall take all such action as may be necessary or
appropriate under the securities or blue sky laws of states or other political
subdivisions of the
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United States in connection with the transactions contemplated by this Agreement
or any Ancillary Agreement.
(d) Certegy shall prepare, file, and use its best efforts to cause to be
approved prior to the Record Date, the application to permit listing of the
Certegy Common Stock on the New York Stock Exchange.
(e) Equifax and Certegy shall take all such actions as may be deemed
reasonably necessary to secure a favorable ruling from the IRS that the
Distribution is not taxable to Equifax or its shareholders pursuant to Section
355 of the Code.
Section 3.02. Conditions Precedent to the Distribution. In no event shall
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the Distribution occur unless the following conditions shall have been satisfied
or waived by Equifax:
(a) Equifax's Board of Directors or a duly appointed committee thereof,
shall, in its sole discretion, have established the Record Date and the
Distribution Date and any appropriate procedures in connection with the
Distribution;
(b) all necessary regulatory approvals shall have been received;
(c) the Information Statement shall have been mailed to the holders of
Equifax Common Stock;
(d) the Form 10 shall have become effective under the Exchange Act, and all
registration statements referred to under Section 3.01(b) shall have become
effective under the Securities Act;
(e) the Certegy Board of Directors, as named in the Form 10, shall have
been elected by Equifax, as sole shareholder of Certegy, and the Certegy
Articles and Certegy Bylaws shall have been adopted and be in effect;
(f) the Certegy Common Stock shall have been approved for listing on the
New York Stock Exchange, subject to official notice of issuance;
(g) Equifax and Certegy shall have taken all such action as may be
necessary or appropriate under the securities or blue sky laws of states or
other political subdivisions of the United States in connection with the
transactions contemplated by this Agreement or any Ancillary Agreement;
(h) Equifax shall have received a favorable private letter ruling from the
IRS that the Contribution constitutes a reorganization pursuant to Section
368(a)(1)(D) of the Code and that the Distribution will not be taxable to
Equifax or its shareholders pursuant to Section 355 of the Code, and such ruling
shall continue in effect;
(i) Certegy shall have entered into the Certegy Revolving Credit Agreement;
(j) the transactions described in Section 2.01 shall have occurred;
-12-
(k) Certegy (or its appropriate subsidiary) shall have performed fully its
(or their) obligations under Section 2.02;
(l) no order, injunction, or decree issued by any court of competent
jurisdiction or other legal restraint or prohibition preventing consummation of
the Distribution shall be in effect;
(m) Equifax and Certegy shall each have performed its obligations under
this Agreement and each Ancillary Agreement, which are required to be performed
prior to or at the time of the Distribution; and
(n) the parties shall have consummated those other transactions in
connection with the Distribution that are contemplated by the Information
Statement to be consummated prior to or at the time of the Distribution and are
not specifically referred to in this Agreement or the Ancillary Agreements
identified in Sections 2.03(a) - (f).
Section 3.03. The Distribution. On or before the Distribution Date,
----------------
subject to satisfaction or waiver of the conditions set forth in this Agreement,
Equifax shall deliver to the Distribution Agent a certificate or certificates
representing all of the then outstanding shares of Certegy Common Stock held by
the Equifax Group, endorsed in blank, and shall instruct the Distribution Agent,
except as otherwise provided in Sections 3.04 and 3.05, to distribute to each
holder of record of Equifax Common Stock on the Record Date one share of Certegy
Common Stock for each two shares of Equifax Common Stock so held either by
crediting the holder's brokerage account or by delivering a certificate or
certificates representing such shares. Certegy agrees to provide all
certificates for shares of Certegy Common Stock that the Distribution Agent
shall require in order to effect the Distribution.
Section 3.04. Fractional Shares. The Distribution Agent shall not
-----------------
distribute any fractional shares of Certegy Common Stock. The Distribution
Agent shall aggregate all such fractional shares and sell them in an orderly
manner after the Distribution Date in the open market and, after completion of
such sales, distribute a pro rata portion of the proceeds from such sales, based
upon the average gross selling price of all such Certegy Common Stock, to each
holder of Equifax Common Stock who would otherwise have received a fractional
share of Certegy Common Stock.
Section 3.05. Stock Trusts. The Distribution Agent shall not distribute
------------
in the Distribution any shares of Certegy Common Stock to the Stock Benefit
Trust, the Rabbi Trusts or any person holding Equifax Common Stock pursuant to
any Equifax restricted stock plan, if and to the extent Equifax so instructs the
Distribution Agent after receipt of a waiver of the right to receive any Certegy
Common Stock from any such Equifax shareholder.
ARTICLE IV
INDEMNIFICATION
Section 4.01. Certegy Indemnification of the Equifax Group. On and after
--------------------------------------------
the Distribution Date, Certegy shall indemnify, defend and hold harmless each
member of the
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Equifax Group, and each of their respective directors, officers, employees and
agents (the "Equifax Indemnitees") from and against any and all Indemnifiable
Losses incurred or suffered by any of the Equifax Indemnitees and arising out
of, or due to, (a) the failure of Certegy or any member of the Certegy Group to
pay, perform or otherwise discharge, any of the Certegy Liabilities and (b) any
untrue statement or alleged untrue statement of any material fact contained in
the preliminary or final Form 10, the preliminary or final Information Statement
or any amendment or supplement thereto or the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading (other than the information about Equifax
included in the sections of the Information Statement attached as Exhibit 99.1
to the Form 10 entitled "Summary - Our Business," "Summary - The Distribution,"
and "The Distribution - Reasons for the Distribution," or any amendment or
supplement thereto).
Section 4.02. Equifax Indemnification of Certegy Group. On and after the
----------------------------------------
Distribution Date, Equifax shall indemnify, defend and hold harmless each member
of the Certegy Group and each of their respective directors, officers, employees
and agents (the "Certegy Indemnitees") from and against any and all
Indemnifiable Losses incurred or suffered by any of the Certegy Indemnitees and
arising out of, or due to, (a) the failure of Equifax or any member of the
Equifax Group to pay, perform or otherwise discharge, any of the Equifax
Liabilities and (b) any untrue statement or alleged untrue statement of any
material fact regarding Equifax included in the sections of the Information
Statement attached as Exhibit 99.1 to the Form 10 entitled "Summary - Our
Business," "Summary - The Distribution," and "The Distribution - Reasons for the
Distribution," or any amendment or supplement thereto or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading.
Section 4.03. Contribution. In circumstances in which the indemnity
------------
agreements provided for in Sections 4.01(b) and 4.02(b) are unavailable or
insufficient, for any reason, to hold harmless an indemnified party in respect
of any Indemnifiable Losses, each indemnifying party, in order to provide for
just and equitable contribution, shall contribute to the amount paid or payable
by such indemnified party as a result of such Indemnifiable Losses, in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party or parties on the one hand and the indemnified party on the other in
connection with the statements or omissions or alleged statements or omissions
that resulted in such Indemnifiable Losses, as well as any other relevant
equitable considerations. The relative fault of the parties shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by Certegy or Equifax, the
parties' relative intents, knowledge, access to information and opportunity to
correct or prevent such statement or omission, and any other equitable
considerations appropriate in the circumstances.
Section 4.04. Insurance and Third Party Obligations. No insurer or any
-------------------------------------
other third party shall be, by virtue of the foregoing indemnification
provisions, (a) entitled to a benefit it would not be entitled to receive in the
absence of such provisions, (b) relieved of the responsibility to pay any claims
to which it is obligated, or (c) entitled to any subrogation rights with respect
to any obligation hereunder.
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ARTICLE V
INDEMNIFICATION PROCEDURES
Section 5.01. Notice and Payment of Claims. If any Equifax or Certegy
----------------------------
Indemnitee (the "Indemnified Party") determines that it is or may be entitled to
indemnification by a party (the "Indemnifying Party") under Article IV (other
than in connection with any Action or claim subject to Section 5.02), the
Indemnified Party shall deliver to the Indemnifying Party a written notice
specifying, to the extent reasonably practicable, the basis for its claim for
indemnification and the amount for which the Indemnified Party reasonably
believes it is entitled to be indemnified. After the Indemnifying Party shall
have been notified of the amount for which the Indemnified Party seeks
indemnification, the Indemnifying Party shall, within 30 days after receipt of
such notice, pay the Indemnified Party such amount in cash or other immediately
available funds (or reach agreement with the Indemnified Party as to a mutually
agreeable alternative payment schedule) unless the Indemnifying Party objects to
the claim for indemnification or the amount thereof. If the Indemnifying Party
does not give the Indemnified Party written notice objecting to such claim and
setting forth the grounds therefor within the same 30 day period, the
Indemnifying Party shall be deemed to have acknowledged its liability for such
claim and the Indemnified Party may exercise any and all of its rights under
applicable law to collect such amount.
Section 5.02. Notice and Defense of Third Party Claims. Promptly
----------------------------------------
following the earlier of (a) receipt of notice of the commencement by a third
party of any Action against or otherwise involving any Indemnified Party or (b)
receipt of information from a third party alleging the existence of a claim
against an Indemnified Party, in either case, with respect to which
indemnification may be sought pursuant to this Agreement (a "Third Party
Claim"), the Indemnified Party shall give the Indemnifying Party written notice
thereof. The failure of the Indemnified Party to give notice as provided in
this Section 5.02 shall not relieve the Indemnifying Party of its obligations
under this Agreement, except to the extent that the Indemnifying Party is
prejudiced by such failure to give notice. Within 30 days after receipt of such
notice, the Indemnifying Party shall by giving written notice thereof to the
Indemnified Party, (a) acknowledge, as between the parties hereto, liability
for, and at its option elect to assume the defense of such Third Party Claim at
its sole cost and expense or (b) object to the claim of indemnification set
forth in the notice delivered by the Indemnified Party pursuant to the first
sentence of this Section 5.02 setting forth the grounds therefor; provided that
if the Indemnifying Party does not within the same 30 day period give the
Indemnified Party written notice acknowledging liability or objecting to such
claim and setting forth the grounds therefor, the Indemnifying Party shall be
deemed to have acknowledged, as between the parties hereto, its liability to the
Indemnified Party for such Third Party Claim. Any contest of a Third Party
Claim as to which the Indemnifying Party has elected to assume the defense shall
be conducted by attorneys employed by the Indemnifying Party and reasonably
satisfactory to the Indemnified Party; provided that the Indemnified Party shall
have the right to participate in such proceedings and to be represented by
attorneys of its own choosing at the Indemnified Party's sole cost and expense.
If the Indemnifying Party assumes the defense of a Third Party Claim, the
Indemnifying Party may settle or compromise the claim without the prior written
consent of the Indemnified Party; provided that the Indemnifying Party may not
agree to any such settlement pursuant to which any remedy or relief, other than
monetary damages for which the Indemnifying Party shall be responsible
hereunder, shall be applied to or against the Indemnified
-15-
Party, without the prior written consent of the Indemnified Party, which consent
shall not be unreasonably withheld. If the Indemnifying Party does not assume
the defense of a Third Party Claim for which it has acknowledged liability for
indemnification under Article IV, the Indemnified Party may require the
Indemnifying Party to reimburse it on a current basis for its reasonable
expenses of investigation, reasonable attorneys' fees and reasonable out-of-
pocket expenses incurred in defending against such Third Party Claim, and the
Indemnifying Party shall be bound by the result obtained with respect thereto by
the Indemnified Party; provided that the Indemnifying Party shall not be liable
for any settlement effected without its consent, which consent shall not be
unreasonably withheld. The Indemnifying Party shall pay to the Indemnified Party
in cash the amount for which the Indemnified Party is entitled to be indemnified
(if any) within 15 days after the final resolution of such Third Party Claim
(whether by the final nonappealable judgment of a court of competent
jurisdiction or otherwise), or, in the case of any Third Party Claim as to which
the Indemnifying Party has not acknowledged liability, within 15 days after such
Indemnifying Party's objection has been resolved by settlement, compromise or
the final nonappealable judgment of a court of competent jurisdiction.
ARTICLE VI
EMPLOYEE MATTERS
Section 6.01. Employee Benefits Agreement. All matters relating to or
---------------------------
arising out of any employee benefit, compensation or welfare arrangement in
respect of any present and former employee of the Equifax Group or the Certegy
Group shall be governed by the Employee Benefits Agreement, except as may be
expressly stated herein or therein, and except that Article VIII shall apply
with respect to such matters to the extent otherwise applicable. In the event
of any inconsistency with respect to such matters between the Employee Benefits
Agreement and this Agreement or any Ancillary Agreement, the Employee Benefits
Agreement shall govern to the extent of the inconsistency.
ARTICLE VII
TAX MATTERS
Section 7.01. Tax Sharing and Indemnification Agreement. All matters
-----------------------------------------
relating to Taxes shall be governed exclusively by the Tax Sharing and
Indemnification Agreement, except as may be expressly stated herein or therein,
and except that Article VIII shall apply with respect to such matters to the
extent otherwise applicable. In the event of any inconsistency with respect to
such matters between the Tax Sharing and Indemnification Agreement and this
Agreement or any other Ancillary Agreement, the Tax Sharing and Indemnification
Agreement shall govern to the extent of the inconsistency.
ARTICLE VIII
ACCOUNTING MATTERS
Section 8.01. Allocation of Prepaid Items and Reserves. All prepaid items
----------------------------------------
and reserves that have been maintained by Equifax on a consolidated basis but
that relate in part to assets or liabilities of the Certegy Group shall be
allocated between Equifax and Certegy as determined by Equifax in its reasonable
discretion.
-16-
Section 8.02. Intercompany Accounts. On or before the Distribution Date,
---------------------
Equifax shall prepare and deliver to Certegy a preliminary PSG Balance Sheet
which shall set forth good faith estimates of all intercompany account balances
between members of the Equifax Group and members of the Certegy Group as of the
Effective Time, after giving effect to any intercompany dividends made or
declared on or before the Distribution Date and any other transfers of assets or
liabilities between the Groups before the Distribution Date pursuant to the
express terms of this Agreement or any Ancillary Agreement. On or before the
Distribution Date, all estimated intercompany account balances owing as set
forth on the preliminary PSG Balance Sheet shall be settled and paid in full by
Certegy or Equifax, as the case may be. Within 30 business days after the
Effective Time, Equifax shall prepare and deliver to Certegy a final PSG Balance
Sheet which shall set forth all intercompany account balances between members of
the Equifax Group and members of the Certegy Group as of the Effective Time,
after giving effect to any intercompany dividends made or declared on or before
the Distribution Date and any other transfers of assets or liabilities between
the Groups before the Distribution Date pursuant to the express terms of this
Agreement or any Ancillary Agreement. Within ten business day after the
delivery of the final PSG Balance Sheet, Equifax shall pay to Certegy or Certegy
shall pay to Equifax, as the case may be, the difference between the estimated
account balances set forth on the preliminary PSG Balance Sheet and the final
account balances set forth on the final PSG Balance Sheet. Notwithstanding
anything contained herein to the contrary, Equifax may at its option contribute
to Certegy amounts owed by any member of the Certegy Group to any member of the
Equifax Group as a contribution to the capital of Certegy in lieu of payment of
such amounts to the Equifax Group by the Certegy Group. Any disputes arising
from the adjustments required by the final PSG Balance Sheet shall be resolved
in accordance with Section 15.10 hereof.
ARTICLE IX
DATA, PRODUCTS AND SERVICES
Section 9.01. Intercompany Data Purchase Agreement. All matters relating
------------------------------------
to the ownership of and the right to use data owned or maintained by any member
of the Equifax Group or the Certegy Group shall be governed exclusively by the
Intercompany Data Purchase Agreement, except as may be expressly stated herein
or therein, and except that Article VIII shall apply with respect to such
matters to the extent otherwise applicable. In the event of any inconsistency
with respect to such matters between the Intercompany Data Purchase Agreement
and this Agreement or any Ancillary Agreement, the Intercompany Data Purchase
Agreement shall govern to the extent of the inconsistency.
ARTICLE X
INTELLECTUAL PROPERTY
Section 10.01. Intellectual Property Agreement. All matters relating to
-------------------------------
the ownership and right to use intellectual property, other than data, shall be
governed exclusively by the Intellectual Property Agreement, except as may be
expressly stated herein or therein, and except that Article VIII shall apply
with respect to such matters to the extent otherwise applicable. In the event
of any inconsistency with respect to such matters between the Intellectual
Property Agreement and this Agreement or any Ancillary Agreement, the
Intellectual Property Agreement shall govern to the extent of the inconsistency.
-17-
ARTICLE XI
TRANSITION SUPPORT
Section 11.01. Services Agreements. All matters relating to the provision
-------------------
of support and other services by the Equifax Group to the Certegy Group and the
Certegy Group to the Equifax Group after the Effective Time, covered by the
Services Agreements, shall be governed exclusively by the respective Services
Agreements, except as may be expressly stated herein or therein, and except that
Article VIII shall apply with respect to such matters to the extent otherwise
applicable. In the event of any inconsistency with respect to such matters
between a particular Services Agreement and this Agreement or any other
Ancillary Agreement, the particular Services Agreement shall govern to the
extent of the inconsistency.
ARTICLE XII
REAL PROPERTY MATTERS
Section 12.01. Real Estate Agreements. All matters relating to real
----------------------
property to be owned, leased, subleased, occupied, or shared by the Equifax
Group or the Certegy Group after the Effective Time shall be governed by the
Real Estate Agreements, except as may be expressly stated herein or therein, and
except that Article VIII shall apply with respect to such matters to the extent
otherwise applicable. In the event of any inconsistency with respect to such
matters between the Real Estate Agreements and this Agreement or any Ancillary
Agreement, the Real Estate Agreements shall govern to the extent of the
inconsistency.
ARTICLE XIII
INFORMATION
Section 13.01. Provision of Corporate Records. As soon as practicable
------------------------------
following the Effective Time, Equifax and Certegy shall each arrange for the
provision to the other of existing corporate documents (e.g. minute books, stock
registers, stock certificates, documents of title, contracts, etc.) in its
possession relating to the other or its business and affairs or to any other
entity that is part of such other's respective Group or to the business and
affairs of such other entity.
Section 13.02. Access to Information. From and after the Effective Time,
---------------------
Equifax and Certegy shall each afford the other and its accountants, counsel and
other designated representatives reasonable access (including using reasonable
efforts to give access to persons or firms possessing information) and
duplicating rights during normal business hours to all records, books,
contracts, instruments, computer data and other data and information in its
possession relating to the business and affairs of the other or a member of its
Group (other than data and information subject to an attorney/client or other
privilege), insofar as such access is reasonably required by the other
including, without limitation, for audit, accounting and litigation purposes.
Section 13.03. Litigation Cooperation. Equifax and Certegy shall each use
----------------------
reasonable efforts to make available to the other, upon written request, its
officers, directors, employees and agents, and the officers, directors,
employees and agents of its subsidiaries, as witnesses to the extent that such
persons may reasonably be required in connection with any legal, administrative
or other proceedings arising out of the business of the other, or of any entity
that is part of the
-18-
others' respective Group, prior to the Effective Time in which the requesting
party or one of its subsidiaries may from time to time be involved. The
requesting party shall bear all out-of-pocket costs and expenses in connection
therewith. In connection with any matter contemplated by this Section 13.03, at
the request of either party, the parties will enter into a mutually acceptable
joint defense agreement so as to maintain to the extent practicable any
attorney-client privilege or work product immunity of any member of any Group.
Section 13.04. Retention of Records. Except as otherwise required by law
--------------------
or agreed to in writing, each party shall, and shall cause the members of its
Group to, retain all information relating to the other's business in accordance
with the past practice of such party. Notwithstanding the foregoing, either
party may destroy or otherwise dispose of any information at any time in
accordance with the corporate record retention policy maintained by such party
with respect to its own records.
Section 13.05. Confidentiality. Each party shall, and shall cause each
---------------
member of its Group to, hold and cause its directors, officers, employees,
agents, consultants and advisors to hold, in strict confidence, unless compelled
to disclose by judicial or administrative process or, in the opinion of its
counsel, by other requirements of law, all information of or concerning the
other party or its Group (except to the extent that this Agreement or any
Ancillary Agreement permits or requires the use or disclosure of such
information or to the extent such information can be shown to have been (a) in
the public domain through no fault of the persons subject to the restrictions of
this Section ("receiving party"), (b) later lawfully acquired after the
Effective Time on a non-confidential basis from a third party or (c)
independently generated without any reference to any proprietary or confidential
information of the other party or its Group), and no receiving party shall (i)
use such information, except for the benefit of the other party's Group in
connection with the performance of this Agreement or the Ancillary Agreements,
or (ii) disclose such information to any other person or entity, except its
employees, directors, officers, agents, auditors, attorneys, financial advisors,
bankers and other consultants and advisors who need to know such information and
who shall be advised of the obligations contained in this Section 13.05 and be
bound by them. Each receiving party shall be deemed to have satisfied its
obligation to hold confidential any information concerning or owned by the other
party or its Group if it exercises the same care as it takes to preserve
confidentiality for its own similar information. The covenants in this Section
13.05 shall survive the transactions contemplated by this Agreement and shall
continue indefinitely; provided, however, that the covenants in this Section
13.05 shall terminate with respect to any information not constituting a trade
secret under applicable law on the third anniversary of the later of the
Distribution Date or the date on which the party subject to such covenants with
respect to such information receives it (but any such termination shall not
terminate or otherwise limit any other covenant or restriction regarding the
disclosure or use of such information under any Ancillary Agreement or other
agreement, instrument or legal obligation).
Section 13.06. Ownership of Information. Any information owned by one
------------------------
party or any of its subsidiaries that is provided to a requesting party pursuant
to Article V, Article XV, or this Article XIII shall be deemed to remain the
property of the providing party. Unless specifically set forth herein, nothing
contained in this Agreement shall be construed as granting or conferring rights
of license or otherwise in any such information.
-19-
ARTICLE XIV
INTEREST ON PAYMENTS
Section 14.01. Interest. Except as otherwise expressly provided in this
--------
Agreement or an Ancillary Agreement, all payments by one party to the other
under this Agreement or any Ancillary Agreement shall be paid, by company check
or wire transfer of immediately available funds to an account in the United
States designated by the recipient, within 30 days after receipt of an invoice
or other written request for payment setting forth the specific amount due and a
description of the basis therefor in reasonable detail. Any amount remaining
unpaid beyond its due date, including disputed amounts that are ultimately
determined to be payable, shall bear interest at a rate of simple interest per
annum equal to the Applicable Rate. Notwithstanding anything to the contrary
contained herein or in any Ancillary Agreement, in no event shall the amount or
rate of interest due and payable exceed the maximum amount or rate of interest
allowed by applicable law (including, without limitation, O.C.G.A. (S) 7-4-18)
and, in the event any such excess payment is made or received, such excess sum
shall be credited as a payment of principal (or if no principal shall remain
outstanding, shall be refunded).
ARTICLE XV
MISCELLANEOUS
Section 15.01. Expenses. Except as specifically provided in this
--------
Agreement or any Ancillary Agreement or in any other agreement between the
parties, all costs and expenses incurred in connection with the preparation,
execution, delivery and implementation of this Agreement and the Ancillary
Agreements and with the consummation of the transactions contemplated by this
Agreement (including transfer taxes and the fees and expenses of the
Distribution Agent and of all counsel, accountants and financial and other
advisors), together with any other amount expressly agreed by Equifax in
writing, shall be paid by Equifax. Without limiting the foregoing, Equifax
shall pay the legal, filing, accounting, printing, and other expenses in
connection with the preparation, printing and filing of the Form 10 and the
Information Statement.
Section 15.02. Notices. All notices and communications under this
-------
Agreement shall be in writing and shall be deemed to have been given (a) when
received, if such notice or communication is delivered by facsimile, hand
delivery or overnight courier, and, (b) three (3) business days after mailing if
such notice or communication is sent by United States registered or certified
mail, return receipt requested, first class postage prepaid. All notices and
communications, to be effective, must be properly addressed to the party to whom
the same is directed at its address as follows:
If to Equifax, to: Equifax Inc.
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
Chief Financial Officer
Fax: (000) 000-0000
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with a copy to: Equifax Inc.
0000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxx
General Counsel
Fax: (000) 000-0000
If to Certegy, to: Certegy Inc.
000 Xxxxx Xxxxxx Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Corporate Vice President
General Counsel and Secretary
Fax:
----------------------
with a copy to: Certegy Inc.
X.X. Xxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx
Corporate Vice President and
Chief Financial Officer
Fax:
----------------------
Either party may, by written notice delivered to the other party in
accordance with this Section 15.02, change the address to which delivery of any
notice shall thereafter be made.
Section 15.03. Amendment and Waiver. This Agreement may not be altered or
--------------------
amended, nor may any rights hereunder be waived, except by an instrument in
writing executed by the party or parties to be charged with such amendment or
waiver. No waiver of any terms, provision or condition of or failure to
exercise or delay in exercising any rights or remedies under this Agreement, in
any one or more instances, shall be deemed to be, or construed as, a further or
continuing waiver of any such term, provision, condition, right or remedy or as
a waiver of any other term, provision or condition of this Agreement.
Section 15.04. Entire Agreement. This Agreement, together with the
----------------
Ancillary Agreements, constitutes the entire understanding of the parties hereto
with respect to the subject matter hereof, superseding all negotiations, prior
discussions and prior agreements and understandings relating to such subject
matter. To the extent that the provisions of this Agreement are inconsistent
with the provisions of any Ancillary Agreement with respect to the subject
matter thereof, the provisions of such Ancillary Agreement shall prevail to the
extent of the inconsistency.
Section 15.05. Consolidation, Merger, Etc.; Parties in Interest;
-------------------------------------------------
Termination.
-----------
(a) Without limiting Section 15.05(b), neither party (referred to in this
Section 15.05(a) as a "transferring party") shall consolidate with or merge into
any other entity or directly or indirectly convey, transfer or lease all or
substantially all of its properties and assets to any entity, unless, in each
case, the other party to such transaction expressly assumes, by a written
agreement, executed and delivered to the other party hereto, in form reasonably
-21-
satisfactory to such other party, all of the Liabilities of the transferring
party under this Agreement and the Ancillary Agreements and the due and punctual
performance or observance of every agreement and covenant of this Agreement and
Ancillary Agreements on the part of the transferring party to be performed or
observed.
(b) Neither of the parties hereto may assign its rights or delegate any
of its duties under this Agreement without the prior written consent of each
other party. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and permitted
assigns. Nothing contained in this Agreement, express or implied, is intended
to confer any benefits, rights or remedies upon any person or entity other than
members of the Equifax Group and the Certegy Group and the Equifax Indemnitees
and Certegy Indemnitees under Articles IV and V hereof.
(c) This Agreement (including Articles IV and V hereof) may be terminated
and the Distribution may be amended, modified or abandoned at any time prior to
the Distribution by and in the sole discretion of Equifax without the approval
of Certegy or the shareholders of Equifax. In the event of such termination, no
party shall have any liability of any kind to any other party or any other
person. After the Distribution, this Agreement may not be terminated except by
an agreement in writing signed by the parties; provided, however, that Articles
IV and V shall not be terminated or amended after the Distribution in respect of
any Equifax Indemnitee or Certegy Indemnitee without the consent of such person.
Section 15.06. Further Assurances and Consents. In addition to the
-------------------------------
actions specifically provided for elsewhere in this Agreement, each of the
parties hereto will use its reasonable efforts to (a) execute and deliver such
further instruments and documents and take such other actions as any other party
may reasonably request in order to effectuate the purposes of this Agreement and
to carry out the terms hereof and (b) take, or cause to be taken, all actions,
and do, or cause to be done, all things, reasonably necessary, proper or
advisable under applicable laws, regulations and agreements or otherwise to
consummate and make effective the transactions contemplated by this Agreement,
including, without limitation, using its reasonable efforts to obtain any
consents and approvals, make any filings and applications and remove any liens,
claims, equity or other encumbrance on an Asset of the other party necessary or
desirable in order to consummate the transactions contemplated by this
Agreement; provided that no party hereto shall be obligated to pay any
consideration therefor (except for filing fees and other similar charges) to any
third party from whom such consents, approvals and amendments are requested or
to take any action or omit to take any action if the taking of or the omission
to take such action would be unreasonably burdensome to the party or its Group
or the business thereof.
Section 15.07. Severability. The provisions of this Agreement are
------------
severable and should any provision hereof be void, voidable or unenforceable
under any applicable law, such provision shall not affect or invalidate any
other provision of this Agreement, which shall continue to govern the relative
rights and duties of the parties as though such void, voidable or unenforceable
provision were not a part hereof.
Section 15.08. Governing Law. This Agreement shall be construed in
-------------
accordance with, and governed by, the laws of the State of Georgia, without
regard to the conflicts of law rules of such state.
-22-
Section 15.09. Counterparts. This Agreement may be executed in one or
------------
more counterparts, each of which shall be deemed an original instrument, but all
of which together shall constitute but one and the same agreement.
Section 15.10. Disputes.
--------
(a) Except as otherwise provided in any Ancillary Agreement, all
disputes, controversies or claims between members of the Equifax Group and the
Certegy Group, which are parties to this Agreement or any Ancillary Agreement,
arising out of or relating to this Agreement or any Ancillary Agreement or the
performance by the parties of its or their terms, whether based on contract,
tort, statute or otherwise, including, but not limited to, disputes in
connection with claims by third parties (collectively, "Disputes"), shall be
resolved only in accordance with the provisions of this Section 15.10; provided,
however, that nothing contained herein shall preclude any party to a Dispute
from seeking or obtaining (i) injunctive relief to prevent an actual or
threatened breach of any of the provisions of this Agreement or any Ancillary
Agreement, or (ii) equitable or other judicial relief to enforce the provisions
of this Section 15.10 hereof or to preserve the status quo pending resolution of
Disputes hereunder.
(b) Any party or parties to a Dispute of either Group may give the parties
to the Dispute of the other Group written notice of the Dispute initiating the
procedures hereunder. Within 10 days after delivery of the notice of a Dispute,
the receiving parties shall submit to the other a written response. The notice
and the response shall include a statement of each party's respective position
and a summary of arguments supporting that position and the name and title of
the executive who will represent the claimants and of any other person who will
accompany such executive in resolving the Dispute. Within twenty (20) days after
delivery of the first notice, the executives of both Groups shall meet at a
mutually acceptable time and place, and thereafter as often as they reasonably
deem necessary, and shall negotiate in good faith to attempt to resolve the
Dispute. All reasonable requests for information made by one party to the other
will be honored.
(c) If the Dispute has not been resolved by negotiation within sixty (60)
days of the notice of Dispute, the Dispute may then be submitted for resolution
by binding arbitration by a panel of three arbitrators conducted in accordance
with the Rules of Arbitration of the International Chamber of Commerce (the
"Rules"), as modified by this Section 15.10. Arbitration shall be initiated by
notice from the parties to a Dispute of either Group ("claimants") given to the
parties to the Dispute of the other Group ("respondents"). The claimants acting
jointly, on the one hand, and the respondents acting jointly, on the other hand,
shall each appoint one arbitrator within 14 days after the claimants give an
arbitration notice. The two arbitrators so appointed shall designate the third
arbitrator by mutual agreement within 30 days after the arbitration notice is
given. If the two arbitrators so appointed fail to designate the third
arbitrator within such period, then any party may request the International
Chamber of Commerce to appoint the third arbitrator within 14 days after such
request. The third arbitrator shall be a lawyer licensed to practice in the
State of Georgia who shall not be related to, employed by, affiliated with or
have had a substantial or ongoing business relationship with any member of
either Group.
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(d) The arbitration shall be conducted in Atlanta, Georgia (or at any other
place agreed upon by the parties and the arbitrators). The parties will
facilitate the arbitration by: (i) making available to one another and to the
arbitrators for examination, inspection and extraction all documents, books,
records and personnel under their control if determined by the arbitrators to be
relevant to the dispute; (ii) conducting arbitration hearings to the greatest
extent possible on successive days; and (iii) observing strictly the time
periods established by this Section 15.10, the Rules or by the Arbitrators for
submission of evidence or briefs. All issues in connection with the Dispute,
including procedural issues, shall be decided by the concurrence of at least two
arbitrators, and all decisions by the arbitrators shall be accompanied by a
written opinion setting forth the findings of fact and conclusions of law relied
upon in reaching the decision. The panel of arbitrators shall decide the issues
submitted to it in accordance with the language and commercial purposes of this
Agreement or the relevant Ancillary Agreement (as applicable); provided that all
questions of law shall be governed by the internal laws of the State of Georgia,
without regard to its conflict of laws rules. The arbitrators' decision shall be
final and binding as to all matters at issue in the Dispute; provided, however,
if necessary such decision may be enforced by either party in any court having
jurisdiction over the parties or the subject matter of the Dispute. Unless the
arbitrators shall assess the costs and expenses of the arbitration proceeding
and of the parties differently, each party shall pay its costs and expenses
incurred in connection with the arbitration proceeding, and the costs and
expenses of the arbitrators shall be shared equally by the parties.
Section 15.11. Headings. The Article and Section headings set forth in
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this Agreement are included for administrative, organizational and convenience
purposes, and are not intended to affect the meaning of the provisions set forth
in this Agreement or to be used in the interpretation of this Agreement.
[signatures appear on following page]
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
EQUIFAX INC.
By:
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Title
CERTEGY INC.
By:
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Title
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