Exhibit 10.1
DISTRIBUTION AGREEMENT
between
IMS HEALTH INCORPORATED
and
SYNAVANT INC.
Dated as of __________, 2000
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS............................................................................1
SECTION 1.1 General...............................................................1
SECTION 1.2 References; Interpretation...........................................11
ARTICLE II DISTRIBUTION AND OTHER TRANSACTIONS; CERTAIN COVENANTS...............................12
SECTION 2.1 The Distribution and Other Transactions..............................12
SECTION 2.2 Intercompany Accounts and Third-Party Accounts.......................15
SECTION 2.3 Cash Balances........................................................15
SECTION 2.4 Assumption and Satisfaction of Liabilities...........................16
SECTION 2.5 Resignations.........................................................16
SECTION 2.6 Non-Solicitation of Employees........................................16
SECTION 2.7 Further Assurances...................................................16
SECTION 2.8 Limited Representations or Warranties................................17
SECTION 2.9 Guarantees...........................................................17
SECTION 2.10 Witness Services.....................................................17
SECTION 2.11 Certain Post-Distribution Transactions...............................18
SECTION 2.12 Transfers Not Effected Prior to the Distribution; Transfers
Deemed Effective as of the Distribution Date.........................19
SECTION 2.13 Conveyancing and Assumption Instruments..............................19
SECTION 2.14 Ancillary Agreements.................................................20
SECTION 2.15 Corporate Names......................................................20
SECTION 2.16 Non-Competition; Protection of Information...........................21
ARTICLE III INDEMNIFICATION.....................................................................23
SECTION 3.1 Indemnification by IMS...............................................23
SECTION 3.2 Indemnification by ST................................................23
SECTION 3.3 Procedures for Indemnification.......................................23
SECTION 3.4 Indemnification Payments.............................................25
ARTICLE IV ACCESS TO INFORMATION................................................................25
SECTION 4.1 Provision of Corporate Records.......................................25
SECTION 4.2 Access to Information................................................25
SECTION 4.3 Reimbursement; Other Matters.........................................25
SECTION 4.4 Confidentiality......................................................26
SECTION 4.5 Privileged Matters...................................................26
SECTION 4.6 Ownership of Information.............................................27
SECTION 4.7 Limitation of Liability..............................................28
SECTION 4.8 Other Agreements Providing for Exchange of Information...............28
ARTICLE V ADMINISTRATIVE SERVICES...............................................................28
SECTION 5.1 Performance of Services..............................................28
SECTION 5.2 Independence.........................................................28
SECTION 5.3 Non-exclusivity......................................................28
ARTICLE VI DISPUTE RESOLUTION...................................................................28
SECTION 6.1 Negotiation..........................................................28
SECTION 6.2 Arbitration..........................................................29
SECTION 6.3 Continuity of Service and Performance................................30
ARTICLE VII INSURANCE...........................................................................30
SECTION 7.1 Policies and Rights Included Within Assets; Assignment of Policies...30
SECTION 7.2 Post-Distribution Date Claims........................................30
SECTION 7.3 Administration; Other Matters........................................31
SECTION 7.4 Agreement for Waiver of Conflict and Shared Defense..................32
SECTION 7.5 Cooperation..........................................................32
ARTICLE VIII MISCELLANEOUS......................................................................32
SECTION 8.1 Complete Agreement; Construction.....................................32
SECTION 8.2 Ancillary Agreements.................................................32
SECTION 8.3 Counterparts.........................................................32
SECTION 8.4 Survival of Agreements...............................................33
SECTION 8.5 Expenses.............................................................33
SECTION 8.6 Payments.............................................................33
SECTION 8.7 Notices..............................................................33
SECTION 8.8 Waivers..............................................................33
SECTION 8.9 Amendments...........................................................33
SECTION 8.10 Assignment...........................................................34
SECTION 8.11 Successors and Assigns...............................................34
SECTION 8.12 Termination..........................................................34
SECTION 8.13 Subsidiaries.........................................................34
SECTION 8.14 Third Party Beneficiaries............................................34
SECTION 8.15 Title and Headings...................................................34
SECTION 8.16 Exhibits and Schedules...............................................34
SECTION 8.17 GOVERNING LAW........................................................34
SECTION 8.18 Consent to Jurisdiction..............................................35
SECTION 8.19 Severability.........................................................35
ii
DISTRIBUTION AGREEMENT
This DISTRIBUTION AGREEMENT (this "Agreement"), is dated as of
__________, 2000, by and between IMS HEALTH INCORPORATED, a Delaware corporation
("IMS") and SYNAVANT INC., a Delaware corporation and, prior to the Distribution
(as defined herein), a wholly-owned subsidiary of IMS ("ST").
WHEREAS, IMS, acting through the ST Group (as defined herein),
currently conducts a number of businesses, including, without limitation, (i)
providing automated sales support technologies to the pharmaceutical industry,
(ii) providing direct marketing services (the "Xxxxx-X'Xxxxx business"), and
(iii) providing direct mail marketing services in Australia (the "Permail
business"), and in the past has conducted a number of other businesses through
the ST Group or its predecessors which have been discontinued, sold or
transferred;
WHEREAS, the Board of Directors of IMS has determined that it is
appropriate, desirable and in the best interests of IMS and its businesses, as
well as of the holders of shares of common stock, par value $0.01 per share, of
IMS (the "IMS Common Stock"), to reorganize IMS to separate from IMS all of the
ST Business (as defined herein) and to cause such ST Business to be owned and
conducted, directly or indirectly, by ST (the "Spin-Off);
WHEREAS, in order to effect the Spin-Off, the Board of Directors of IMS
has determined that it is appropriate, desirable and in the best interests of
IMS and its businesses, as well as of the holders of IMS Common Stock, for IMS
(i) to take certain steps to reorganize IMS' Subsidiaries (as defined herein)
and businesses, including, prior to the Distribution, the consummation of the
restructuring steps more fully set forth on Exhibit A hereto and (ii) upon the
completion of such reorganization to distribute to the holders of the IMS Common
Stock of all the outstanding shares of common stock, par value $0.01 per share,
of ST (the "ST Common Shares"), together with the associated Rights (as defined
herein), as set forth herein;
WHEREAS, each of IMS and ST has determined that it is necessary and
desirable, on or prior to the Distribution Date (as defined herein), to allocate
and transfer those assets and to allocate and assign responsibility for those
liabilities in respect of the activities of the businesses of such entities and
those assets and liabilities in respect of other businesses and activities of
IMS and its current and former Subsidiaries and other matters; and
WHEREAS, each of IMS and ST has determined that it is necessary and
desirable to set forth the principal corporate transactions required to effect
such Distribution and to set forth other agreements that will govern certain
other matters following the Distribution.
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained in this Agreement, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 GENERAL. As used in this Agreement, the following terms
shall have the following meanings:
(a) "Action" shall mean any action, suit, arbitration, inquiry,
proceeding or investigation by or before any court, any governmental or other
regulatory or administrative agency, body or commission or any arbitration
tribunal.
(b) "Affiliate" shall mean, when used with respect to a specified
person, another person that controls, is controlled by, or is under common
control with the person specified. As used herein, "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such person, whether through the
ownership of voting securities or other interests, by contract or otherwise.
(c) "Agent" shall have the meaning set forth in Section 2.1(b).
(d) "Agreement Disputes" shall have the meaning set forth in
Section 6.1.
(e) "allocable portion of Insurance Proceeds" shall have the
meaning set forth in Section 7.3(c).
(f) "allocable share of the deductible" shall have the meaning set
forth in Section 7.3(d).
(g) "Ancillary Agreements" shall mean all of the written
agreements, instruments, assignments or other arrangements (other than this
Agreement) entered into in connection with the transactions contemplated hereby,
including, without limitation, the Conveyancing and Assumption Instruments, the
Employee Benefits Agreement, the Tax Allocation Agreement, the Corporate
Services Agreement, the Data and Telecommunications Services Agreement, the
Xponent and Pharbase data license agreements and the Shared Transaction Services
Agreement.
(h) "Assets" shall mean assets, properties and rights (including
goodwill), wherever located (including in the possession of vendors or other
third parties or elsewhere), whether real, personal or mixed, tangible,
intangible or contingent, in each case whether or not recorded or reflected or
required to be recorded or reflected on the books and records or financial
statements of any person, including, without limitation, the following:
(i) all accounting and other books, records and files
whether in paper, microfilm, microfiche, computer
tape or disc, magnetic tape or any other form;
(ii) all apparatus, computers and other electronic data
processing equipment, fixtures, machinery, equipment,
furniture, office equipment, automobiles, trucks,
aircraft and other transportation equipment, special
and general tools, test devices, prototypes and
models and other tangible personal property;
(iii) all inventories of materials, parts, raw materials,
supplies, work-in-process and finished goods and
products;
(iv) all interests in real property of whatever nature,
including easements, whether as owner, mortgagee or
holder of a Security Interest in real property,
lessor, sublessor, lessee, sublessee or otherwise;
(v) all interests in any capital stock or other equity
interests of any Subsidiary or any other person, all
bonds, notes, debentures or other securities issued
by any Subsidiary or any other person, all loans,
advances or other extensions of credit or capital
contributions to any
-2-
Subsidiary or any other person and all other
investments in securities of any person;
(vi) all license agreements, leases of personal property,
open purchase orders for raw materials, supplies,
parts or services, unfilled orders for the
manufacture and sale of products and other contracts,
agreements or commitments;
(vii) all deposits, letters of credit and performance and
surety bonds;
(viii) all written technical information, data,
specifications, research and development information,
engineering drawings, operating and maintenance
manuals, and materials and analyses prepared by
consultants and other third parties;
(ix) all domestic and foreign patents, copyrights, trade
names, trademarks, service marks and registrations
and applications for any of the foregoing, mask
works, trade secrets, inventions, data bases, other
proprietary information and licenses from third
persons granting the right to use any of the
foregoing;
(x) all computer applications, programs and other
software, including operating software, network
software, firmware, middleware, design software,
design tools, systems documentation and instructions;
(xi) all cost information, sales and pricing data,
customer prospect lists, supplier records, customer
and supplier lists, customer and vendor data,
correspondence and lists, product literature,
artwork, design, development and manufacturing files,
vendor and customer drawings, formulations and
specifications, quality records and reports and other
books, records, studies, surveys, reports, plans and
documents;
(xii) all prepaid expenses, trade accounts and other
accounts and notes receivable;
(xiii) all rights under contracts or agreements, all claims
or rights against any person arising from the
ownership of any asset, all rights in connection with
any bids or offers and all claims, choses in action
or similar rights, whether accrued or contingent;
(xiv) all rights under insurance policies and all rights in
the nature of insurance, indemnification or
contribution;
(xv) all licenses, permits, approvals and authorizations
which have been issued by any Governmental Authority;
(xvi) cash or cash equivalents, bank accounts, lock boxes
and other deposit arrangements; and
(xvii) interest rate, currency, commodity or other swap,
collar, cap or other hedging or similar agreements or
arrangements.
-3-
(i) "Assignee" shall have the meaning set forth in Section 2.1(f).
(j) "Business Entity" shall mean any corporation, partnership,
limited liability company or other entity which may legally hold title to
Assets.
(k) "Claims Administration" shall mean the processing of claims
made under the Shared Policies, including, without limitation, the reporting of
claims to the insurance carriers and the management of the defense of claims.
(l) "Xxxxx-X'Xxxxx business" shall have the meaning set forth in
the recitals hereto.
(m) "Code" shall mean the Internal Revenue Code of 1986, as
amended, and the Treasury regulations promulgated thereunder, including any
successor legislation.
(n) "Commission" shall mean the U.S. Securities and Exchange
Commission.
(o) "Conveyancing and Assumption Instruments" shall mean,
collectively, the various agreements, instruments and other documents heretofore
entered into and to be entered into to effect the transfer of Assets and the
assumption of Liabilities in the manner contemplated by this Agreement, or
otherwise arising out of or relating to the transactions contemplated by this
Agreement, which shall be in substantially the forms attached hereto as Schedule
1.1(o) for transfers to be effected pursuant to New York law or the laws of one
of the other states of the United States, or, if not appropriate for a given
transfer, and for transfers to be effected pursuant to non-U.S. laws, shall be
in such other form or forms as the parties agree and as may be required by the
laws of such non-U.S. jurisdictions.
(p) "Distribution" shall mean the distribution on the Distribution
Date to holders of record of shares of IMS Common Stock as of the Distribution
Record Date of the ST Common Shares owned by IMS on the basis of one ST Common
Share for every 20 outstanding shares of IMS Common Stock.
(q) "Distribution Date" shall mean [_________ __], 2000.
(r) "Distribution Record Date" shall mean as of the close of
business of such date as may be determined by IMS' Board of Directors as the
record date for the Distribution.
(s) "Effective Time" shall mean immediately prior to the midnight,
New York time, ending the 24-hour period comprising [___________ __], 2000.
(t) "Employee Benefits Agreement" shall mean the Employee Benefits
Agreement by and between IMS and ST.
(u) "Form 10" shall have the meaning set forth in Section 2.1(c).
(v) "Funded Liabilities" shall have the meaning set forth in
Section 2.3(a).
(w) "Governmental Authority" shall mean any federal, state, local,
foreign or international court, government, department, commission, board,
bureau, agency, official or other regulatory, administrative or governmental
authority.
-4-
(x) "IMS Assets" shall mean, collectively, all the rights and
Assets owned or held by IMS or any Subsidiary of IMS immediately prior to the
Effective Time, except the ST Assets.
(y) "IMS Business" shall mean each and every business conducted at
any time by IMS or any Subsidiary of IMS prior to the Effective Time, except the
ST Business.
(z) "IMS Common Stock" shall have the meaning set forth in the
recitals hereto.
(aa) "IMS Contracts" shall mean all the contracts and agreements to
which IMS or any of its Affiliates is a party or by which it or any of its
Affiliates is bound immediately prior to the Effective Time, except the ST
Contracts.
(bb) "IMS Debt" shall mean have the meaning set forth in Section
2.1(n).
(cc) "IMS Group" shall mean IMS and each person (other than any
member of the ST Group) that is a Subsidiary of IMS immediately prior to the
Effective Time.
(dd) "IMS Indemnitees" shall mean IMS, each member of the IMS
Group, each of their respective present and former directors, officers,
employees and agents and each of the heirs, executors, successors and assigns of
any of the foregoing, as well as any present and former directors, officers,
employees and agents of IMS prior to the Effective Time and each of their heirs,
executors, successors and assigns, except the ST Indemnitees.
(ee) "IMS Liabilities" shall mean collectively, all obligations and
Liabilities of IMS or any Subsidiary of IMS immediately prior to the Effective
Time, except the ST Liabilities.
(ff) "IMS Policies" shall mean all Policies, current or past, which
are owned or maintained by or on behalf of IMS or any Subsidiary of IMS
immediately prior to the Effective Time which do not relate to the ST Business
and which Policies are either maintained by IMS or a member of the IMS Group or
are assignable to IMS or a member of the IMS Group.
(gg) "IMS Retained Businesses" shall have the meaning set forth in
Section 2.16.
(hh) "Indemnifiable Losses" shall mean any and all losses,
liabilities, claims, damages, demands, costs or expenses (including, without
limitation, reasonable attorneys' fees and any and all out-of-pocket expenses)
reasonably incurred in investigating, preparing for or defending against any
Actions or potential Actions or in settling any Action or potential Action or in
satisfying any judgment, fine or penalty rendered in or resulting from any
Action.
(ii) "Indemnifying Party" shall have the meaning set forth in
Section 3.3.
(jj) "Indemnitee" shall have the meaning set forth in Section 3.3.
(kk) "Indemnity and Joint Defense Agreement" shall mean the
Indemnity and Joint Defense Agreement dated as of October 28, 1996 by and among
Cognizant Corporation, The Dun & Bradstreet Corporation and ACNielsen
Corporation.
-5-
(ll) "Information Statement" shall mean the Information Statement
sent to the holders of shares of IMS Common Stock in connection with the
Distribution, including any amendment or supplement thereto.
(mm) "Insurance Administration" shall mean, with respect to each
Shared Policy, the accounting for premiums, retrospectively-rated premiums,
defense costs, indemnity payments, deductibles and retentions, as appropriate,
under the terms and conditions of each of the Shared Policies; and the reporting
to excess insurance carriers of any losses or claims which may cause the
per-occurrence, per claim or aggregate limits of any Shared Policy to be
exceeded, and the distribution of Insurance Proceeds as contemplated by this
Agreement.
(nn) "Insurance Proceeds" shall mean those monies (i) received by
an insured from an insurance carrier or (ii) paid by an insurance carrier on
behalf of an insured, in either case net of any applicable premium adjustment,
retrospectively-rated premium, deductible, retention, or cost of reserve paid or
held by or for the benefit of such insured.
(oo) "Insured Claims" shall mean those Liabilities that,
individually or in the aggregate, are covered within the terms and conditions of
any of the Shared Policies, whether or not subject to deductibles, co-insurance,
uncollectibility or retrospectively-rated premium adjustments.
(pp) "Intercompany Accounts" shall mean all accounts between IMS
and ST and their respective Subsidiaries (as defined herein), including
receivables, payables and loans, or any other accounts that may arise, that are
not designated as Third Party Accounts (as defined herein.
(qq) "IRI Action" shall mean the complaint filed in the United
States District Court for the Southern District of New York on July 29, 1996 by
Information Resources, Inc. naming as defendants The Dun & Bradstreet
Corporation, X. X. Xxxxxxx Company and IMS International, Inc.
(rr) "Liabilities" shall mean any and all losses, claims, charges,
debts, demands, actions, causes of action, suits, damages, obligations,
payments, costs and expenses, sums of money, accounts, reckonings, bonds,
specialties, indemnities and similar obligations, exonerations, covenants,
contracts, controversies, agreements, promises, doings, omissions, variances,
guarantees, make whole agreements and similar obligations, and other
liabilities, including all contractual obligations, whether absolute or
contingent, matured or unmatured, liquidated or unliquidated, accrued or
unaccrued, known or unknown, whenever arising, and including those arising under
any law, rule, regulation, Action, threatened or contemplated Action (including
the costs and expenses of demands, assessments, judgments, settlements and
compromises relating thereto and attorneys' fees and any and all costs and
expenses, whatsoever reasonably incurred in investigating, preparing or
defending against any such Actions or threatened or contemplated Actions), order
or consent decree of any governmental or other regulatory or administrative
agency, body or commission or any award of any arbitrator or mediator of any
kind, and those arising under any contract, commitment or undertaking, including
those arising under this Agreement or any Ancillary Agreement, in each case,
whether or not recorded or reflected or required to be recorded or reflected on
the books and records or financial statements of any person.
(ss) "1996 Distribution" shall mean the Distribution described in
the 1996 Distribution Agreement.
-6-
(tt) "1998 Distribution" shall mean the Distribution described in
the 1998 Distribution Agreement.
(uu) "1996 Distribution Agreement" shall mean the Distribution
Agreement among Cognizant Corporation, The Dun & Bradstreet Corporation and
ACNielsen Corporation, dated as of October 28, 1996.
(vv) "1998 Distribution Agreement" shall mean the Distribution
Agreement between Cognizant Corporation and IMS Health Incorporated, dated as of
June 30, 1998.
(ww) "Non-U.S. Cash Target" shall have the meaning set forth in
Section 2.3(a).
(xx) "person" shall mean any natural person, Business Entity,
corporation, business trust, joint venture, association, company, partnership,
other entity or government, or any agency or political subdivision thereof.
(yy) "Permail business" shall have the meaning set forth in the
recitals hereto.
(zz) "Policies" shall mean insurance policies and insurance
contracts of any kind (other than life and benefits policies or contracts),
including, without limitation, primary, excess and umbrella policies,
comprehensive general liability policies, director and officer liability,
fiduciary liability, automobile, aircraft, property and casualty, workers'
compensation and employee dishonesty insurance policies, bonds and
self-insurance and captive insurance company arrangements, together with the
rights, benefits and privileges thereunder.
(aaa) "Provider" shall have the meaning set forth in Section 5.1.
(bbb) "Recipient" shall have the meaning set forth in Section 5.1.
(ccc) "Records" shall have the meaning set forth in Section 4.1.
(ddd) "Restricted Period" shall have the meaning set forth in
Section 2.16.
(eee) "Retained Businesses" shall have the meaning set forth in
Section 2.16.
(fff) "Rights" shall have the meaning set forth in Section 2.1(c).
(ggg) "Rules" shall have the meaning set forth in Section 6.2.
(hhh) "Security Interest" shall mean any mortgage, security
interest, pledge, lien, charge, claim, option, right to acquire, voting or other
restriction, right-of-way, covenant, condition, easement, encroachment,
restriction on transfer, or other encumbrance of any nature whatsoever.
(iii) "Shared Policies" shall mean all Policies, current or past,
which are owned or maintained by or on behalf of IMS or any Subsidiary of IMS
immediately prior to the Effective Time which relate to the IMS Business and the
ST Business.
(jjj) "ST Assets" shall mean:
-7-
(i) the ownership interests in those Business Entities
listed on Schedule 1.1(jjj)(i);
(ii) any and all Assets that are expressly contemplated by
this Agreement, including those on the list of
pre-Distribution reorganization transactions attached
as Schedule 1.1(jjj)(ii) hereto, or any Ancillary
Agreement (or included on any Schedule hereto or
thereto) as Assets which have been or are to be
transferred to ST or any other member of the ST Group
prior to the Effective Time or are to remain with ST
or any member of the ST Group subsequent to the
Effective Time;
(iii) any Assets reflected on the ST Balance Sheet or the
accounting records supporting such balance sheet and
any Assets acquired by or for ST or any member of the
ST Group subsequent to the date of such balance sheet
which, had they been so acquired on or before such
date and owned as of such date, would have been
reflected on such balance sheet if prepared on a
consistent basis, subject to any dispositions of any
of such Assets subsequent to the date of such balance
sheet;
(iv) subject to Article VII, any rights of any member of
the ST Group under any of the Policies, including any
rights thereunder arising from and after the
Effective Time in respect of any Policies that are
occurrence policies; and
(v) any ST Contracts, any rights or claims arising
thereunder, and any other rights or claims or
contingent rights or claims primarily relating to or
arising from any ST Asset or the ST Business.
Notwithstanding the foregoing, the ST Assets shall
not in any event include:
(y) any Assets primarily relating to or used in
any terminated or divested Business Entity,
business or operation formerly owned or
managed by or associated with IMS, ST or any
ST Business, except for those Assets
primarily relating to or used in those
Business Entities, businesses or operations
listed on Schedule 1.1(jjj)(v)(y); or
(z) any and all Assets that are expressly
contemplated by this Agreement or any
Ancillary Agreement (or the Schedules hereto
or thereto) as Assets to be transferred or
conveyed to any member of the IMS Group,
including those Assets listed on Schedule
1.1(jjj)(v)(z).
In the event of any inconsistency or conflict which
may arise in the application or interpretation of any
of the foregoing provisions, for the purpose of
determining what is and is not a ST Asset, any item
explicitly included on a Schedule referred to in this
Section 1.1(jjj)(v) shall take priority over any
inconsistent
-8-
provisions herein or Annex A and Schedule 1.1(kkk)
hereto, and clause (y) shall take priority over
clause (z) hereof of this Section 1.1(jjj)(v).
(kkk) "ST Balance Sheet" shall mean the combined balance sheet of
the ST Group, including the notes thereto, as of March 31, 2000, set forth as
Schedule 1.1(kkk) hereto.
(lll) "ST Business" shall mean (i) the businesses conducted by the
subsidiaries of ST set forth on Schedule 1.1(lll)(i) hereto, (ii) the
pharmaceutical industry automated sales and marketing support business of IMS
Health Strategic Technologies, Inc., a Delaware corporation and wholly-owned
subsidiary of IMS, and the businesses of certain other foreign subsidiaries of
IMS, as set forth on Schedule 1.1(lll)(ii) hereto and (iii) the interactive and
direct marketing business of IMS, including the Xxxxx-X'Xxxxx business, as set
forth on Schedule 1.1(lll)(iii) hereto. Notwithstanding anything to the
contrary, the ST Business does not include the businesses, or divisions of
businesses, currently conducted by IMS.
(mmm) "ST Common Shares" shall have the meaning set forth in the
recitals hereto.
(nnn) "ST Contracts" shall mean the following contracts and
agreements to which ST or any of its Affiliates is a party or by which it or any
of its Affiliates or any of their respective Assets is bound, whether or not in
writing, except for any such contract or agreement that is not expressly
contemplated to be transferred or assigned to ST, or any other member of the ST
Group prior to the Effective Time, or to remain with ST, or any other member of
the ST Group subsequent to the Effective Time, pursuant to any provision of this
Agreement or any Ancillary Agreement:
(i) any contracts or agreements listed or described on
Schedule 1.1(nnn)(i);
(ii) any contract or agreement entered into in the name
of, or expressly on behalf of, any division, business
unit or member of the ST Group;
(iii) any contract or agreement that relates primarily to
the ST Business;
(iv) federal, state and local government and other
contracts and agreements that are listed or described
on Schedule 1.1(nnn)(iv) and any other government
contracts or agreements entered into after the date
hereof and prior to the Effective Time that relate
primarily to the ST Business;
(v) any contract or agreement representing capital or
operating equipment lease obligations reflected on
the ST Balance Sheet, including obligations as lessee
under those contracts or agreements listed on
Schedule 1.1(nnn)(v);
(vi) any contract or agreement that is otherwise expressly
contemplated pursuant to this Agreement or any of the
Ancillary Agreements to be transferred or assigned to
ST or any member of the ST Group prior to the
Effective Time or to remain with ST or any member of
the ST Group subsequent to the Effective Time; and
-9-
(vii) any guarantee, indemnity, representation or warranty
of any member of the ST Group.
(ooo) "ST Group" shall mean (i) ST, (ii) Xxxxx-X'Xxxxx, Inc., a New
Jersey corporation ("Xxxxx-X'Xxxxx"), and (iii) each Business Entity which is
contemplated to become a Subsidiary of ST hereunder immediately prior to the
Effective Time, which shall include those identified as such on Schedules
1.1(jjj)(i) (which Schedule shall also indicate the amount of ST's direct or
indirect ownership interest therein) and 1.1(jjj)(ii) hereto.
(ppp) "ST Indemnitees" shall mean ST, each member of the ST Group,
each of their respective present and former directors, officers, employees and
agents and each of the heirs, executors, successors and assigns of any of the
foregoing.
(qqq) "ST Liabilities" shall mean:
(i) any and all Liabilities that are expressly
contemplated by this Agreement or any Ancillary
Agreement (or the Schedules hereto or thereto,
including Schedule 1.1(qqq)(i) hereto) as Liabilities
to be assumed by ST or any member of the ST Group
prior to the Effective Time or to remain with any
member of the ST Group subsequent to the Effective
Time, and all agreements, obligations and Liabilities
of ST or any member of the ST Group under this
Agreement or any of the Ancillary Agreements;
(ii) all Liabilities (other than Taxes and any
employee-related Liabilities subject to the
provisions of the Tax Allocation Agreement and the
Employee Benefits Agreement, respectively), primarily
relating to, arising out of or resulting from:
(A) the operation of the ST Business, as
conducted at any time prior to, on or after
the Effective Time (including any Liability
relating to, arising out of or resulting
from any act or failure to act by any
director, officer, employee, agent or
representative (whether or not such act or
failure to act is or was within such
person's authority));
(B) any ST Assets;
whether arising before, on or after the Effective
Time;
(iii) all Liabilities reflected as liabilities or
obligations on the ST Balance Sheet or the accounting
records supporting such balance sheet, and all
Liabilities arising or assumed after the date of such
balance sheet which, had they arisen or been assumed
on or before such date and been retained as of such
date, would have been reflected on such balance
sheet, subject to any discharge of such Liabilities
subsequent to the date of the ST Balance Sheet; and
Notwithstanding the foregoing, the ST Liabilities shall not
include:
-10-
(x) any Liabilities that are expressly
contemplated by this Agreement or any
Ancillary Agreement (or the Schedules hereto
or thereto) as Liabilities to be assumed by
IMS or any member of the IMS Group,
including any Liabilities set forth in
Schedule 1.1(qqq)(x);
(y) any Liabilities primarily relating to,
arising out of or resulting from any
terminated or divested Business Entity,
business or operation formerly owned or
managed by or associated with IMS or any ST
Business except for Liabilities primarily
relating to, arising out of or resulting
from those Business Entities, businesses or
operations listed in Schedule 1.1(qqq)(y);
or
(z) all agreements and obligations of any member
of the IMS Group under this Agreement or any
of the Ancillary Agreements.
(rrr) "ST Policies" shall mean all Policies, current or past, which
are owned or maintained by or on behalf of ST or any Subsidiary of ST
immediately prior to the Effective Time, which do not relate to the IMS
Business.
(sss) "ST Retained Businesses" shall have the meaning set forth in
Section 2.16.
(ttt) "Subsidiary" shall mean any corporation, partnership or other
entity of which another entity (i) owns, directly or indirectly, ownership
interests sufficient to elect a majority of the Board of Directors (or persons
performing similar functions) (irrespective of whether at the time any other
class or classes of ownership interests of such corporation, partnership or
other entity shall or might have such voting power upon the occurrence of any
contingency) or (ii) is a general partner or an entity performing similar
functions (e.g., a trustee).
(uuu) "Tax" shall have the meaning set forth in the Tax Allocation
Agreement.
(vvv) "Tax Allocation Agreement" shall mean the Tax Allocation
Agreement by and between IMS and ST, dated as of __________, 2000.
(www) "Third Party Accounts" shall mean all accounts between IMS and
ST, and their respective Subsidiaries, and third parties, including receivables,
payables and loans, or any other accounts that may arise, that are not
designated as Intercompany Accounts.
(xxx) "Third Party Claim" shall have the meaning set forth in
Section 3.3.
(yyy) "U.S. Cash Target" shall have the meaning set forth in Section
2.3(a).
SECTION 1.2 REFERENCES; INTERPRETATION. References in this
Agreement to any gender include references to all genders, and references to
the singular include references to the plural and vice versa. The words
"include," "includes" and "including" when used in this Agreement shall be
deemed to be followed by the phrase "without limitation." Unless the context
otherwise requires, references in this Agreement to Articles, Sections,
Exhibits and Schedules shall be deemed references to Articles and Sections
of, and Exhibits and Schedules to, such Agreement. Unless the context
otherwise requires, the words "hereof," "hereby" and "herein" and words of
similar meaning when used in this Agreement refer to this Agreement in its
entirety and not to any particular Article, Section or provision of this
Agreement.
-11-
ARTICLE II
DISTRIBUTION AND OTHER TRANSACTIONS; CERTAIN COVENANTS
SECTION 2.1 THE DISTRIBUTION AND OTHER TRANSACTIONS.
(a) Certain Transactions. On or prior to the Distribution Date:
(i) IMS shall, on behalf of itself and its Subsidiaries,
transfer or cause to be transferred to ST or another member of the ST
Group, effective prior to or as of the Effective Time, all of IMS' and
its Subsidiaries' right, title and interest in the ST Assets.
(ii) ST shall be entitled to designate the Business Entity
within the ST Group to which any Assets are to be transferred pursuant
to this Section 2.1(a).
(b) STOCK DIVIDEND TO IMS. On or prior to the Distribution Date,
ST shall issue to IMS as a stock dividend (i) such number of ST Common Shares as
will be required to effect the Distribution, as certified by IMS' stock transfer
agent (the "Agent"). In connection therewith IMS shall deliver to ST for
cancellation the share certificate held by it representing ST Common Shares and
shall receive a new certificate or certificates representing the total number of
ST Common Shares to be owned by IMS after giving effect to such stock dividend.
Each ST Common Share delivered by ST to IMS shall be validly issued, fully paid
and nonassessable and free of any preemptive (or similar) rights.
(c) CHARTERS; BY-LAWS; RIGHTS PLANS. On or prior to the
Distribution Date, all necessary actions shall have been taken to provide for
the adoption of the form of Certificate of Incorporation and By-laws and the
execution and delivery of the form of Rights Agreement, relating to the
preferred share purchase rights relating to the ST Common Shares (the "Rights"),
filed by ST with the Commission as exhibits to ST's Registration Statement on
Form 10 (the "Form 10").
(d) DIRECTORS. On or prior to the Distribution Date, IMS as the
sole stockholder of ST, shall have taken all necessary actions on or prior to
the Distribution Date to cause the Board of Directors of ST to consist of the
individuals identified in the Information Statement as directors of ST.
(e) CERTAIN LICENSES AND PERMITS. Without limiting the generality
of the obligations set forth in Section 2.1(a), on or prior to the Distribution
Date or as soon as reasonably practicable thereafter:
(i) all transferable licenses, permits and authorizations
issued by any Governmental Authority which do not relate primarily to
the IMS Business but which are held in the name of IMS or any member of
the IMS Group, or in the name of any employee, officer, director,
stockholder or agent of IMS or any such member, or otherwise, on behalf
of a member of the ST Group shall be duly and validly transferred or
caused to be transferred by IMS to the appropriate member of the ST
Group; and
(ii) all transferable licenses, permits and authorizations
issued by Governmental Authorities which relate primarily to the IMS
Business but which are held in the name of any member of the ST Group,
or in the name of any employee, officer, director, stockholder, or
agent of any such member, or otherwise, on behalf of a member
-12-
of the IMS Group shall be duly and validly transferred or caused to be
transferred by ST to IMS or the appropriate member of the IMS Group.
(f) TRANSFER OF AGREEMENTS. Without limiting the generality of the
obligations set forth in Section 2.1(a):
(i) IMS hereby agrees that, on or prior to the
Distribution Date or as soon as reasonably practicable thereafter,
subject to the limitations set forth in this Section 2.1(f), it will,
and it will cause each member of the IMS Group to, assign, transfer and
convey to the appropriate member of the ST Group all of IMS' or such
member of the IMS Group's respective right, title and interest in and
to any and all ST Contracts;
(ii) ST hereby agrees that on or prior to the Distribution
Date or as soon as reasonably practicable thereafter, subject to the
limitations set forth in this Section 2.1(f), it will, and it will
cause each member of the ST Group to, assign, transfer and convey to
IMS or the appropriate member of the IMS Group all of ST's or such
member of the ST Group's respective right, title and interest in and to
any and all IMS Contracts;
(iii) subject to the provisions of this Section 2.1(f), any
agreement to which any of the parties hereto or any of their
Subsidiaries is a party that inures to the benefit of both the IMS
Business and the ST Business shall be assigned in part so that each
party shall be entitled to the rights and benefits inuring to its
business under such agreement;
(iv) the assignee of any agreement assigned, in whole or
in part, hereunder (an "Assignee") shall assume and agree to pay,
perform, and fully discharge all obligations of the assignor under such
agreement or, in the case of a partial assignment under paragraph
(f)(iii), such Assignee's related portion of such obligations as
determined in accordance with the terms of the relevant agreement,
where determinable on the face thereof, and otherwise as determined in
accordance with the practice of the parties prior to the Distribution;
and
(v) notwithstanding anything in this Agreement to the
contrary, this Agreement shall not constitute an agreement to assign
any agreement, in whole or in part, or any rights thereunder if the
agreement to assign or attempt to assign, without the consent of a
third party, would constitute a breach thereof or in any way adversely
affect the rights of the assignor or Assignee thereof. Until such
consent is obtained, or if an attempted assignment thereof would be
ineffective or would adversely affect the rights of any party hereto so
that the intended Assignee would not, in fact, receive all such rights,
the parties will cooperate with each other in any arrangement designed
to provide for the intended Assignee the benefits of, and to permit the
intended Assignee to assume liabilities under, any such agreement.
(g) CONSENTS. The parties hereto shall use their commercially
reasonable efforts to obtain required consents to transfer and/or assignment of
licenses, permits and authorizations of Governmental Authorities and of
agreements hereunder.
(h) DELIVERY OF SHARES TO AGENT. IMS shall deliver to the Agent
the share certificates representing the ST Common Shares issued to IMS by ST
pursuant to Section 2.1(b) which are to be distributed to the holders of IMS
Common Stock in the Distribution and shall
-13-
instruct the Agent to distribute, on or as soon as practicable following the
Distribution Date, certificates representing such ST Common Shares to holders of
record of shares of IMS Common Stock on the Distribution Record Date as further
contemplated by the Information Statement and herein. ST shall provide all share
certificates that the Agent shall require in order to effect the Distribution.
(i) CERTAIN LIABILITIES. For purposes of this Agreement, including
Article III hereof, ST agrees with IMS that:
(i) any and all Liabilities arising from or relating to
the Form 10 filed by ST shall be deemed to be ST Liabilities and not
IMS Liabilities; provided, however, that IMS shall indemnify ST for all
ST Liabilities in connection with the filing of the Form 10; and
(ii) other than as otherwise provided in this Agreement or
the Ancillary Documents, any and all Liabilities arising from or
related to the spin-off of Cognizant Corporation and ACNielsen
Corporation from The Dun & Bradstreet Corporation pursuant to the 1996
Distribution Agreement, other than those set forth on Schedule
2.1(i)(ii) hereto, shall be deemed to be IMS Liabilities and not ST
Liabilities.
(iii) other than as otherwise provided in this Agreement or
the Ancillary Documents, any and all Liabilities arising from or
related to the spin-off of IMS from Cognizant Corporation pursuant to
the 1998 Distribution Agreement, other than those set forth on Schedule
2.1(i)(iii) hereto shall be deemed to be IMS Liabilities and not ST
Liabilities.
(iv) notwithstanding anything to the contrary herein, IMS
shall retain all environmental liabilities associated with the Wilton,
Connecticut property and shall indemnify ST for any environmental
cleanup costs, fines or penalties incurred by ST in connection with the
Wilton, Connecticut property.
(j) CERTAIN CONTINGENCIES. For purposes of this Agreement,
including Article III hereof, each of ST and IMS agrees that:
(i) notwithstanding anything to the contrary herein or in
the Tax Allocation Agreement, each of IMS and ST shall be liable for a
portion of the liabilities related to certain prior business
transactions to the extent and in the circumstances described in
Schedule 2.1(j)(i), subject to a ten million dollar (US$ 10,000,000)
cap on liability, including the Liabilities set forth in Section
2.1(j)(i); and
(ii) any and all Liabilities of IMS under the Indemnity
and Joint Defense Agreement or otherwise related to the IRI Action,
including legal fees and expenses related thereto, shall be allocated
as to 50% to IMS and as to 50% to ST, subject to a ten million dollar
(US$ 10,000,000) cap on Liabilities, including those liabilities set
forth in Section 2.1(j)(i); provided, however, that ST's obligation to
reimburse IMS shall be triggered by any payments made by IMS and not a
determination of liability under the terms of the Indemnity and Joint
Defense Agreement. ST shall be entitled to a refund of all funds paid
to IMS which exceed IMS's out-of-pocket expenses.
(k) UNDERTAKINGS OF ST.
-14-
(i) On or prior to the Distribution Date, ST will
undertake to each of The Dun & Bradstreet Corporation and ACNielsen
Corporation to be jointly and severally liable for all "Cognizant
Liabilities" (as defined in the 1996 Distribution Agreement) under the
1996 Distribution Agreement pursuant to an undertaking substantially in
the form of Exhibit 2.1(k)(i) hereto.
(ii) On or prior to the Distribution Date, ST will
undertake to Cognizant Corporation to be jointly and severally liable
for all "IMS HEALTH Liabilities" (as defined in the 1998 Distribution
Agreement) under the 1998 Distribution Agreement pursuant to an
undertaking substantially in the form of Exhibit 2.1(k)(ii) hereto.
(l) OTHER TRANSACTIONS. On or prior to the Distribution Date, each
of IMS and ST shall consummate those other transactions in connection with the
Distribution that are contemplated by the Form 10 and Exhibit A hereto, in order
to implement the Distribution. After the Distribution Date, each of IMS and ST
will exercise good faith commercially reasonable efforts to consummate as
promptly as practicable all other transactions which must be consummated in
order fully to complete the Distribution and any of the transactions
contemplated hereby or by any of the Ancillary Agreements.
SECTION 2.2 INTERCOMPANY ACCOUNTS AND THIRD-PARTY ACCOUNTS. All
Intercompany Accounts and Third Party Accounts (other than receivables,
payables and loans otherwise specifically provided for hereunder, under any
Ancillary Agreement or set forth on Schedule 2.3(b), including payables
created or required hereby or by any Ancillary Agreement), including, without
limitation, in respect of any cash balances, any cash balances representing
deposited checks or drafts for which only a provisional credit has been
allowed or any cash held in any centralized cash management system between
ST, or any member of the ST Group, on the one hand, and IMS or any member of
the IMS Group, on the other hand, which exist and are reflected in the
accounting records of the relevant parties as of June 30, 2000 or which arise
on or after June 30, 2000 shall be paid or settled in the ordinary course of
business in a manner consistent with the payment or settlement of similar
accounts arising from transactions with third parties no later than five (5)
days after the Distribution Date.
SECTION 2.3 CASH BALANCES. (a) In addition to any other obligations
hereunder or under any Ancillary Agreement or otherwise, on the close of
business on July 31, 2000, ST shall have cash balances in the amount equal to
(i) ten million seven hundred thousand United States dollars (US$ 10,700,000)
in United States accounts (the "U.S. Cash Target"), (ii) the United States
dollar equivalent (measured as of July 31, 2000) of one million five hundred
thousand United States dollars (US$ 1,500,000) in accounts outside of the
United States (the "Non-U.S. Cash Target") and (iii) amounts required to fund
the liabilities set forth on Schedule 2.3(a) (the "Funded Liabilities"). Cash
shall be determined in accordance with GAAP.
(b) To the extent that (i) cash balances as of July 31, 2000 in
accounts outside the United States exceeds the Non-U.S. Cash Target, ST shall
transfer the excess funds in Euros to IMS Nederland Finance BV, or through some
other manner as agreed upon by ST and IMS or (ii) cash balances as of July 31,
2000 in accounts outside the United States are less than the Non-U.S. Cash
Target, IMS shall cause IMS Nederland Finance BV to transfer the shortfall in
Euros to an entity outside of the U.S. designated by ST, or through some other
manner as agreed upon by ST and IMS.
-15-
(c) To the extent that (i) cash balances as of July 31, 2000 in
accounts in the United States exceeds the U.S. Cash Target plus the amount of
the Funded Liabilities, ST shall transfer the excess funds to IMS or (ii) cash
balances as of July 31, 2000 in accounts in the United States are less than the
U.S. Cash Target plus the amount of the Funded Liabilities, IMS shall transfer
the shortfall to ST.
(d) Any cash transfers into or out of ST's non-U.S and U.S.
accounts after the close of business on July 31, 2000 will be for ST's account
and shall have no effect upon the transactions contemplated by this Section 2.3.
(e) Promptly after the Distribution Date, but no later than
September 25, 2000, ST and IMS shall determine, on a preliminary basis, the
balances in ST's U.S. and non-U.S. accounts, which determination shall be
subject to review by PricewaterhouseCoopers LLP. Based on such preliminary
determination, any amounts payable under this Section 2.3 shall be paid by the
appropriate party to the other party no later than September 30, 2000. No later
than December 31, 2000, ST and IMS shall determine, on a final basis, such
balances which determination shall be subject to review by
PricewaterhouseCoopers LLP. To the extent the final determination differs from
the preliminary determination, the appropriate party shall pay the applicable
amount thereof to the other party no later than January 15, 2001.
SECTION 2.4 ASSUMPTION AND SATISFACTION OF LIABILITIES. Except as
otherwise specifically set forth in any Ancillary Agreement, from and after
the Effective Time, (i) IMS shall, and shall cause each member of the IMS
Group to, assume, pay, perform and discharge all IMS Liabilities and (ii) ST
shall, and shall cause each member of the ST Group to, assume, pay, perform
and discharge all ST Liabilities. To the extent reasonably requested to do so
by another party hereto, each party hereto agrees to sign such documents, in
a form reasonably satisfactory to such party, as may be reasonably necessary
to evidence the assumption of any Liabilities hereunder.
SECTION 2.5 RESIGNATIONS. (a) Subject to Section 2.5(b), IMS shall
cause all their employees to resign, effective as of the Distribution Date,
from all positions as officers or directors of any member of the ST Group in
which they serve, and ST shall cause all its employees to resign, effective
as of the Effective Time, from all positions as officers or directors of IMS
or any members of the IMS Group in which they serve.
(b) No person shall be required by any party hereto to resign from
any position or office with another party hereto if such person is disclosed in
the Information Statement as the person who is to hold such position or office
following the Distribution.
SECTION 2.6 NON-SOLICITATION OF EMPLOYEES. From the date of this
Agreement, and for a period of three years after the Effective Time, each
party hereby covenants and agrees that neither it nor any of its Affiliates
shall actively solicit, or cause or authorize, directly or indirectly, to be
solicited for employment or employ or cause or authorize, directly or
indirectly, to be employed or engaged as an employee, for or on behalf of
itself or any other person, any person who is currently, or was, less than 90
days prior to the date of this Agreement, an executive officer, senior
manager (or the equivalent thereof), executive vice president or employee of
any other party or any of such party's Subsidiaries, without such party's
prior written approval.
SECTION 2.7 FURTHER ASSURANCES. In case at any time after the
Effective Time any further action is reasonably necessary or desirable to
carry out the purposes of this Agreement and the Ancillary Agreements, the
proper officers of each party to this Agreement shall take all
-16-
such necessary action. Without limiting the foregoing, IMS and ST shall use
their commercially reasonable efforts promptly to obtain all consents and
approvals, to enter into all amendatory agreements and to make all filings and
applications that may be required for the consummation of the transactions
contemplated by this Agreement and the Ancillary Agreements, including, without
limitation, all applicable governmental and regulatory filings. IMS agrees that
it shall bear all costs incurred with the execution and consummation of the acts
required by this Section 2.7.
SECTION 2.8 LIMITED REPRESENTATIONS OR WARRANTIES. Each of the
parties hereto agrees that no party hereto is, in this Agreement or in any
other agreement or document contemplated by this Agreement or otherwise,
making any representation or warranty whatsoever, as to title or value of
Assets being transferred. It is also agreed that, notwithstanding anything to
the contrary otherwise expressly provided in the relevant Conveyancing and
Assumption Instrument, all Assets either transferred to or retained by the
parties, as the case may be, shall be "as is, where is" and that (subject to
Section 2.7) the party to which such Assets are to be transferred hereunder
shall bear the economic and legal risk that such party's or any of the
Subsidiaries' title to any such Assets shall be other than good and
marketable and free from encumbrances. Similarly, each party hereto agrees
that, except as otherwise expressly provided in the relevant Conveyancing and
Assumption Instrument, no party hereto is representing or warranting in any
way that the obtaining of any consents or approvals, the execution and
delivery of any amendatory agreements and the making of any filings or
applications contemplated by this Agreement will satisfy the provisions of
any or all applicable agreements or the requirements of any or all applicable
laws or judgments, it being agreed that the party to which any Assets are
transferred shall bear the economic and legal risk that any necessary
consents or approvals are not obtained or that any requirements of laws or
judgments are not complied with.
SECTION 2.9 GUARANTEES. (a) Except as otherwise specified in any
Ancillary Agreement, ST shall use its commercially reasonable efforts to
have, on or prior to the Distribution Date, or as soon as practicable
thereafter, IMS and any member of the IMS Group removed as guarantor of or
obligor for any ST Liability, including, without limitation, in respect of
those guarantees set forth on Schedule 2.9(a) to the extent that they relate
to ST Liabilities.
(b) ST shall use its commercially reasonable efforts to have, no
later than six months after the Distribution Date, IMS and any member of the IMS
Group removed as guarantor of or obligor in respect of those guarantees set
forth on Schedule 2.9(b).
(c) Except as otherwise specified in any Ancillary Agreement, IMS
and ST shall use their commercially reasonable efforts to have, on or prior to
the Distribution Date, or as soon as practicable thereafter, any member of the
ST Group removed as guarantor of or obligor for any IMS Liability, including,
without limitation, in respect of those guarantees set forth on Schedule 2.9(c)
to the extent that they relate to IMS Liabilities.
(d) If IMS or ST is unable to obtain, or to cause to be obtained,
any such required removal as set forth in clauses (a), (b) or (c) of this
Section 2.9, the applicable guarantor or obligor shall continue to be bound as
such and, unless not permitted by law or the terms thereof, the relevant
beneficiary shall or shall cause one of its Subsidiaries, as agent or
subcontractor for such guarantor or obligor to pay, perform and discharge fully
all the obligations or other liabilities of such guarantor or obligor thereunder
from and after the date hereof.
SECTION 2.10 WITNESS SERVICES. At all times from and after the
Distribution Date, each of IMS and ST shall use their commercially reasonable
efforts to make available to the other,
-17-
upon reasonable written request, its and its Subsidiaries' officers, directors,
employees and agents as witnesses to the extent that (i) such persons may
reasonably be required in connection with the prosecution or defense of any
Action in which the requesting party may from time to time be involved and (ii)
there is no conflict in the Action between the requesting party and IMS or ST as
applicable. A party providing witness services to the other party under this
Section shall be entitled to receive from the recipient of such services, upon
the presentation of invoices therefor, payments for such amounts, relating to
disbursements and other out-of-pocket expenses (which shall be deemed to exclude
the costs of salaries and benefits of employees who are witnesses), as may be
reasonably incurred in providing such witness services.
SECTION 2.11 CERTAIN POST-DISTRIBUTION TRANSACTIONS.
(a)(i) IMS shall comply and shall cause its Subsidiaries to comply
with and otherwise not take action inconsistent with each representation and
statement made to XxXxxxxxx, Will & Xxxxx in connection with the request by
IMS for a legal opinion in respect of the Distribution as to certain tax
aspects of the Distribution, and (ii) until two years after the Distribution
Date, IMS will maintain its status as a company engaged in the active conduct
of a trade or business, as defined in Section 355(b) of the Code.
(b)(i) ST shall comply and shall cause its Subsidiaries to comply
with and otherwise not take action inconsistent with each representation and
statement made to XxXxxxxxx, Will & Xxxxx in connection with the request by
IMS for a legal opinion in respect of the Distribution as to certain tax
aspects of the Distribution, and (ii) until two years after the Distribution
Date, ST will maintain its status as a company engaged in the active conduct
of a trade or business, as defined in Section 355(b) of the Code.
(c) ST agrees that until two years after the Distribution Date,
it will not (i) merge or consolidate with or into any other corporation, (ii)
liquidate or partially liquidate, (iii) sell or transfer all or substantially
all of its assets (within the meaning of Rev. Proc. 77-37, 1977-2 C.B. 568)
in a single transaction or series of related transactions, (iv) redeem or
otherwise repurchase any ST Common Shares (other than as described in Section
4.05(1)(b) of Rev. Proc. 96-30, 1996-1 C.B. 696), or (v) take any other
action or actions which in the aggregate would have the effect of causing or
permitting one or more persons to acquire directly or indirectly stock
representing a 50 percent or greater interest (within the meaning of Section
355(e) of the Code) in ST, unless prior to taking such action ST has obtained
(and provided to IMS) a written opinion of a law firm reasonably acceptable
to IMS, or a ruling from the Internal Revenue Service, that such action or
actions will not result in (y) the Distribution failing to qualify under
Section 355(a) of the Code or (z) the ST Common Shares failing to qualify as
qualified property for purposes of Section 355(c)(2) of the Code by reason of
Section 355(e) of the Code.
(d) ST agrees and covenants that it will use its commercially
reasonable best efforts to ensure that:
(i) IMS will incur no liability under the IMS Bank
Guaranty; and
(ii) any bank providing credit support to ST under the
Letter of Credit will incur no liability.
(e) ST agrees and covenants that it will use its commercially
reasonable best efforts to secure an independent line of credit within the two
month period subsequent to the
-18-
Distribution Date that satisfies all of ST's working capital requirements as a
going concern without IMS credit support of any kind.
(f) Notwithstanding anything to the contrary herein or in the Tax
Allocation Agreement, if IMS or ST (or any of their respective Subsidiaries)
fails to comply with any of its obligations under Sections 2.11(a), 2.11(b),
2.11(c), 2.11(d) and 2.11(e) above or takes or fails to take any action on or
after the Distribution Date, and such failure to comply, action or omission
contributes to a determination that (i) the Distribution fails to qualify under
Section 355(a) of the Code or (ii) the ST Common Shares fail to qualify as
qualified property for purposes of Section 355(c)(2) of the Code by reason of
Section 355(e) of the Code, then such party shall indemnify and hold harmless
the other party, each member of the consolidated group of which the other party
is a member and the stockholders of either party from and against any and all
federal, state and local taxes, including any interest, penalties or additions
to tax, imposed upon or incurred by such other party, any member of its group or
any stockholder of either party as a result of the failure of the Distribution
to qualify under Section 355(a) of the Code or the application of Section
355(e). The obligation of ST to indemnify IMS pursuant to the preceding sentence
shall not be affected by the delivery of any legal opinion or supplemental
ruling under Sections 2.11(c), 2.11(d) or 2.11(e).
SECTION 2.12 TRANSFERS NOT EFFECTED PRIOR TO THE DISTRIBUTION;
TRANSFERS DEEMED EFFECTIVE AS OF THE DISTRIBUTION DATE. To the extent that
any transfers contemplated by this Article II shall not have been consummated
on or prior to the Distribution Date, the parties shall cooperate to effect
such transfers as promptly following the Distribution Date as shall be
practicable. Nothing herein shall be deemed to require the transfer of any
Assets or the assumption of any Liabilities which by their terms or operation
of law cannot be transferred; provided, however, that the parties hereto and
their respective Subsidiaries shall cooperate to seek to obtain any necessary
consents or approvals for the transfer of all Assets and Liabilities
contemplated to be transferred pursuant to this Article II. In the event that
any such transfer of Assets or Liabilities has not been consummated, from and
after the Distribution Date, the party retaining such Asset or Liability
shall hold such Asset in trust for the use and benefit of the party entitled
thereto (at the expense of the party entitled thereto) or 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 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 is reasonably possible, in the same
position as would have existed had such Asset or Liability been transferred
as contemplated hereby. As and when any such Asset or Liability becomes
transferable, such transfer shall be effected forthwith. The parties agree
that, as of the Distribution Date, each party hereto shall be deemed to have
acquired complete and sole beneficial ownership over 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, which such party is entitled to acquire or required to assume
pursuant to the terms of this Agreement.
SECTION 2.13 CONVEYANCING AND ASSUMPTION INSTRUMENTS. In connection
with the transfers of Assets and the assumptions of Liabilities contemplated
by this Agreement, the parties shall execute, or cause to be executed by the
appropriate entities, the Conveyancing and Assumption Instruments in
substantially the form contemplated hereby for transfers to be effected
pursuant to New York law or the laws of one of the other states of the United
States or, if not appropriate for a given transfer, and for transfers to be
effected pursuant to non-U.S. laws, in such other form as the parties shall
reasonably agree, including the transfer of real property with deeds
-19-
as may be appropriate. The transfer of capital stock shall be effected by means
of delivery of stock certificates and executed stock powers and notation on the
stock record books of IMS or other legal entities involved, or by such other
means as may be required in any non-U.S. jurisdiction to transfer title to stock
and, to the extent required by applicable law, by notation on public registries.
SECTION 2.14 ANCILLARY AGREEMENTS. Prior to the Distribution Date,
each of IMS and ST shall enter into, and/or (where applicable) shall cause
members of the IMS Group or the ST Group, as applicable, to enter into, the
Ancillary Agreements and any other agreements in respect of the Distribution
reasonably necessary or appropriate in connection with the transactions
contemplated hereby and thereby.
SECTION 2.15 CORPORATE NAMES. (a) Except as otherwise specifically
provided in any Ancillary Agreement:
(i) as soon as reasonably practicable after the
Distribution Date but in any event within six months thereafter, IMS
will, at its own expense, remove (or, if necessary, on an interim
basis, cover up) any and all exterior signs and other identifiers
located on any of its property or premises or on the property or
premises used by it or its Subsidiaries (except property or premises to
be shared with ST or its Subsidiaries after the Distribution) which
refer or pertain to ST or which include the ST name, logo or other
trademark or other intellectual property utilizing ST;
(ii) as soon as reasonably practicable after the
Distribution Date but in any event within six months thereafter, IMS
will, and will cause its Subsidiaries to, remove from all letterhead,
envelopes, invoices and other communications media of any kind, all
references to ST, including the "ST" name, logo and any other trademark
or other intellectual property utilizing ST (except that ST shall not
be required to take any such action with respect to materials in the
possession of customers), and neither IMS nor its Subsidiaries shall
use or display the "ST" name, logo or other trademarks or intellectual
property utilizing ST without the prior written consent of ST;
(b) Except as otherwise specifically provided in any Ancillary
Agreement:
(iii) as soon as reasonably practicable after the
Distribution Date but in any event within six months thereafter, ST
will, at its own expense, remove (or, if necessary, on an interim
basis, cover up) any and all exterior signs and other identifiers
located on any of their respective property or premises owned or used
by them or their respective Subsidiaries (except property or premises
to be shared with IMS or its Subsidiaries after the Distribution) which
refer or pertain to IMS or which include the "IMS Health Incorporated"
or "IMS" name, logo or other trademark or other IMS intellectual
property;
(iv) as soon as reasonably practicable after the
Distribution Date but in any event within six months thereafter, ST
will, and will cause its respective Subsidiaries to, remove from all
letterhead, envelopes, invoices and other communications media of any
kind, all references to IMS, including the "IMS Health Incorporated" or
"IMS" name, logo and any other trademark or other IMS intellectual
property (except that ST shall not be required to take any such action
with respect to materials in the possession of customers), and neither
ST nor any of its Subsidiaries shall
-20-
use or display the "IMS Health Incorporated" or "IMS" name, logo or
other trademarks or IMS intellectual property without the prior written
consent of IMS; and
(v) as soon as reasonably practicable after the
Distribution Date but in any event within six months thereafter, ST
will, and will cause its Subsidiaries to, change their corporate names
to the extent necessary to remove and eliminate any reference to IMS,
including the "IMS" Health Incorporated or "IMS" name; provided,
however, that notwithstanding the foregoing requirements of this
Section 2.14(b), if ST has exercised good faith efforts to comply with
this clause (iii) but is unable, due to regulatory or other
circumstance beyond its control, to effect a corporate name change in
compliance with applicable law, then ST or its Subsidiary will not be
deemed to be in breach hereof if it continues to exercise good faith
efforts to effectuate such name change and does effectuate such name
change within nine months after the Distribution Date, and, in such
circumstances, such party may continue to include in exterior signs and
other identifiers and in letterhead, envelopes, invoices and other
communications references to the name which includes references to IMS
but only to the extent necessary to identify such party and only until
such party's corporate name can be changed to remove and eliminate such
references.
SECTION 2.16 NON-COMPETITION; PROTECTION OF INFORMATION.
(a) IMS hereby covenants and agrees that neither it nor any of its
respective Subsidiaries will, between the Effective Time and the [fifth]
anniversary of the Effective Time (the "Restricted Period"):
(i) engage in or carry on any business in the United
States or elsewhere in whatever form which would be in competition with
any of ST's Retained Businesses (as defined herein) as such businesses
are conducted by ST at the Effective Time; and
(ii) engage in or carry on any business in the United
States or elsewhere in whatever form, directly or indirectly, with ST
named competitors;
(b) ST hereby covenants and agrees that neither it nor any of its
respective Subsidiaries, will, during the Restricted Period:
(i) engage in or carry on any business in the United
States or elsewhere in whatever form which would be in competition with
any of IMS's Retained Businesses (as defined herein) as such businesses
are conducted by IMS at the Effective; and
(ii) engage in or carry on any business in the United
States or elsewhere, directly or indirectly, with (a) NDC Automation,
Inc., Quintiles Transnational Corp., Healtheon/WebMD Corporation,
Cejedim or any of their respective subsidiaries and (b) any companies
controlled by or managed by Xxxx Derecque or Xxxxxx Xxxxxxx; and
(iii) engage in or carry on any commercial data business.
(c) In the event that ST (i) sells, transfers or leases all or
substantially all of its assets, (ii) is not the surviving corporation in any
merger, consolidation or other
-21-
business combination in which it may enter with any person or (iii) enters into
any joint venture, joint marketing, or partnership agreements into which it may
enter with any person, in any case prior to the termination of the Restricted
Period, ST will cause such purchaser or surviving corporation, as the case may
be, to assume ST's obligations under this Section 2.16 upon the consummation of
any such transaction, and, in the case of a joint venture, joint marketing or
partnership agreement, ST will cause the party to such agreement, and such party
will be deemed, to be bound by the provisions of this Section 2.16.
(d) Notwithstanding anything to the contrary in Sections 2.16(a),
(b) or (c) above, nothing in this Section 2.16 shall in any way restrict or
preclude either party or any of its respective Subsidiaries from acquiring and
operating any company (or substantially all of the assets thereof) whose primary
business is not in competition with either of the parties' Retained Businesses.
Each of the parties further covenant that neither party nor any of its
Subsidiaries or any its officers, directors, employees or agent thereof will
disclose any confidential information with respect to either parties' Retained
Businesses without the prior written consent of the other party, and will
enforce to the fullest extent possible, on behalf of the other party, the other
party's rights under or pursuant to its policies and agreements with third
parties, restricting or prohibiting disclosure by such persons of such
confidential information.
(e) As used herein:
(i) the term "IMS Retained Businesses" shall mean the
following businesses of IMS: (i) sales management information services
(including sales compensation applications, targeting and scrubbing
services) which are based on commercial data, (ii) market research
services also based on the commercialization of data, (iii) data
analytics, and (iv) consulting services, decision support tools and
services and information technology relating to the foregoing (but
excluding sales force automation and customer relationship management
systems), all of which relates to the pharmaceutical, biotechnology,
diagnostics, medical/surgical supply and health care industries;
(ii) the term "ST Retained Businesses" shall mean the
following businesses of ST: (i) sales force automation and customer
relationship management systems, which is based on the sale of
proprietary software (ii) implementation, integration and consulting
services relating to the foregoing and (iii) direct mail services, and
drug sample accountability and distribution, all of which relates to
the pharmaceutical, biotechnology, diagnostics, medical / surgical
supply and health care industries; and
(iii) the term "Retained Businesses" shall refer to both
the IMS Retained Businesses and the ST Retained Businesses, including
all business units currently in each company.
(f) Each of IMS and ST acknowledge and agree that the covenants
and agreements contained in this Section 2.16 have been negotiated in good faith
by each of them, and are reasonable and not more restrictive or broader than
necessary to protect the interests of each of IMS and ST in the IMS Retained
Businesses and the ST Retained Businesses, respectively, and would not achieve
their intended purpose if they were on
-22-
different terms or for periods of time shorter than the periods of time provided
herein or applied in more restrictive geographical and business line areas than
are provided herein.
ARTICLE III
INDEMNIFICATION
SECTION 3.1 INDEMNIFICATION BY IMS. Except as otherwise
specifically set forth in any provision of this Agreement or of any Ancillary
Agreement, IMS shall indemnify, defend and hold harmless the ST Indemnitees
from and against any and all Indemnifiable Losses of the ST Indemnitees
arising out of, by reason of or otherwise in connection with the IMS
Liabilities or alleged IMS Liabilities, including any breach by IMS of any
provision of this Agreement or any Ancillary Agreement.
SECTION 3.2 INDEMNIFICATION BY ST. Except as otherwise specifically
set forth in any provision of this Agreement or of any Ancillary Agreement,
ST shall indemnify, defend and hold harmless the IMS Indemnitees from and
against any and all Indemnifiable Losses of the IMS Indemnitees arising out
of, by reason of or otherwise in connection with the ST Liabilities or
alleged ST Liabilities, including any breach by ST of any provision of this
Agreement or any Ancillary Agreement.
SECTION 3.3 PROCEDURES FOR INDEMNIFICATION.
(a) THIRD PARTY CLAIMS. If a claim or demand is made against an
IMS Indemnitee or a ST Indemnitee (each, an "Indemnitee") by any person who is
not a party to this Agreement (a "Third Party Claim") as to which such
Indemnitee is entitled to indemnification pursuant to this Agreement, such
Indemnitee shall notify the party which is or may be required pursuant to
Section 3.1 or Section 3.2 hereof to make such indemnification (the
"Indemnifying Party") in writing, and in reasonable detail, of the Third Party
Claim promptly (and in any event within 15 business days) after receipt by such
Indemnitee of written notice of the Third Party Claim; provided, however, that
failure to give such notification shall not affect the indemnification provided
hereunder except to the extent the Indemnifying Party shall have been actually
prejudiced as a result of such failure (except that the Indemnifying Party shall
not be liable for any expenses incurred during the period in which the
Indemnitee failed to give such notice). Thereafter, the Indemnitee shall deliver
to the Indemnifying Party, promptly (and in any event within five business days)
after the Indemnitee's receipt thereof, copies of all notices and documents
(including court papers) received by the Indemnitee relating to the Third Party
Claim.
If a Third Party Claim is made against an Indemnitee, the Indemnifying
Party shall be entitled to participate in the defense thereof and, if it so
chooses and acknowledges in writing its obligation to indemnify the Indemnitee
therefor, to assume the defense thereof with counsel selected by the
Indemnifying Party; provided that such counsel is not reasonably objected to by
the Indemnitee. Should the Indemnifying Party so elect to assume the defense of
a Third Party Claim, the Indemnifying Party shall, within 30 days (or sooner if
the nature of the Third Party Claim so requires), notify the Indemnitee of its
intent to do so, and the Indemnifying Party shall thereafter not be liable to
the Indemnitee for legal or other expenses subsequently incurred by the
Indemnitee in connection with the defense thereof; provided, that such
Indemnitee shall have the right to employ counsel to represent such Indemnitee
if, in such Indemnitee's reasonable judgment, a conflict of interest between
such Indemnitee and such Indemnifying Party exists in respect of such claim
which would make representation of both such parties by one counsel
inappropriate, and in such event the fees and expenses of such separate counsel
shall be paid by such Indemnifying Party. If the Indemnifying Party assumes such
defense, the Indemnitee shall
-23-
have the right to participate in the defense thereof and to employ counsel,
subject to the proviso of the preceding sentence, at its own expense, separate
from the counsel employed by the Indemnifying Party, it being understood that
the Indemnifying Party shall control such defense. The Indemnifying Party shall
be liable for the fees and expenses of counsel employed by the Indemnitee for
any period during which the Indemnifying Party has failed to assume the defense
thereof (other than during the period prior to the time the Indemnitee shall
have given notice of the Third Party Claim as provided above). If the
Indemnifying Party so elects to assume the defense of any Third Party Claim, all
of the Indemnitees shall cooperate with the Indemnifying Party in the defense or
prosecution thereof, including by providing or causing to be provided, Records
and witnesses as soon as reasonably practicable after receiving any request
therefor from or on behalf of the Indemnifying Party.
If the Indemnifying Party acknowledges in writing responsibility for a
Third Party Claim, then in no event will the Indemnitee admit any liability with
respect to, or settle, compromise or discharge, any Third Party Claim without
the Indemnifying Party's prior written consent; provided, however, that the
Indemnitee shall have the right to settle, compromise or discharge such Third
Party Claim without the consent of the Indemnifying Party if the Indemnitee
releases the Indemnifying Party from its indemnification obligation hereunder
with respect to such Third Party Claim and such settlement, compromise or
discharge would not otherwise adversely affect the Indemnifying Party. If the
Indemnifying Party acknowledges in writing liability for a Third Party Claim,
the Indemnitee will agree to any settlement, compromise or discharge of a Third
Party Claim that the Indemnifying Party may recommend and that by its terms
obligates the Indemnifying Party to pay the full amount of the liability in
connection with such Third Party Claim and releases the Indemnitee completely in
connection with such Third Party Claim and that would not otherwise adversely
affect the Indemnitee; provided, however, that the Indemnitee may refuse to
agree to any such settlement, compromise or discharge if the Indemnitee agrees
that the Indemnifying Party's indemnification obligation with respect to such
Third Party Claim shall not exceed the amount that would be required to be paid
by or on behalf of the Indemnifying Party in connection with such settlement,
compromise or discharge. If an Indemnifying Party elects not to assume the
defense of a Third Party Claim, or fails to notify an Indemnitee of its election
to do so as provided herein, such Indemnitee may compromise, settle or defend
such Third Party Claim.
Notwithstanding the foregoing, the Indemnifying Party shall not be
entitled to assume the defense of any Third Party Claim (and shall be liable for
the fees and expenses of counsel incurred by the Indemnitee in defending such
Third Party Claim) if the Third Party Claim seeks an order, injunction or other
equitable relief or relief for other than money damages against the Indemnitee
which the Indemnitee reasonably determines, after conferring with its counsel,
cannot be separated from any related claim for money damages. If such equitable
relief or other relief portion of the Third Party Claim can be so separated from
that for money damages, the Indemnifying Party shall be entitled to assume the
defense of the portion relating to money damages.
(b) In the event of payment by an Indemnifying Party to any
Indemnitee in connection with any Third-Party Claim, such Indemnifying Party
shall be subrogated to and shall stand in the place of such Indemnitee as to any
events or circumstances in respect of which such Indemnitee may have any right
or claim relating to such Third-Party Claim against any claimant or plaintiff
asserting such Third-Party Claim. Such Indemnitee shall cooperate with such
Indemnifying Party in a reasonable manner, and at the cost and expense of such
Indemnifying Party, in prosecuting any subrogated right or claim.
-24-
(c) The remedies provided in this Article III shall be cumulative
and shall not preclude assertion by any Indemnitee of any other rights or the
seeking of any and all other remedies against any Indemnifying Party.
SECTION 3.4 INDEMNIFICATION PAYMENTS. Indemnification required by
this Article III shall be made by periodic payments of the amount thereof
during the course of the investigation or defense, as and when bills are
received or loss, liability, claim, damage or expense is incurred.
ARTICLE IV
ACCESS TO INFORMATION
SECTION 4.1 PROVISION OF CORPORATE RECORDS.
(a) Other than in circumstances in which indemnification is sought
pursuant to Article III (in which event the provisions of such Article will
govern), after the Distribution Date, upon the prior written request by ST for
specific and identified agreements, documents, books, records or files
(collectively, "Records") which relate to (x) ST or the conduct of the ST
Business up to the Effective Time, or (y) any Ancillary Agreement to which IMS
and ST are parties, as applicable, IMS shall arrange, as soon as reasonably
practicable following the receipt of such request, for the provision of
appropriate copies of such Records (or the originals thereof if the party making
the request has a reasonable need for such originals) in the possession or
control of IMS or any of its Subsidiaries, but only to the extent such items are
not already in the possession or control of the requesting party.
(b) Other than in circumstances in which indemnification is sought
pursuant to Article III (in which event the provisions of such Article will
govern), after the Distribution Date, upon the prior written request by IMS for
specific and identified Records which relate to (x) IMS or the conduct of the
IMS Business up to the Effective Time, or (y) any Ancillary Agreement to which
ST and IMS are parties, as applicable, ST shall arrange, as soon as reasonably
practicable following the receipt of such request, for the provision of
appropriate copies of such Records (or the originals thereof if the party making
the request has a reasonable need for such originals) in the possession or
control of ST or any of its Subsidiaries, but only to the extent such items are
not already in the possession or control of the requesting party.
SECTION 4.2 ACCESS TO INFORMATION. Other than in circumstances in
which indemnification is sought pursuant to Article III (in which event the
provisions of such Article will govern), from and after the Distribution
Date, each of IMS and ST shall afford to the other and its authorized
accountants, counsel and other designated representatives reasonable access
during normal business hours, subject to appropriate restrictions for
classified, privileged or confidential information, to the personnel,
properties, books and records of such party and its Subsidiaries insofar as
such access is reasonably required by the other party and relates to (x) such
other party or the conduct of its business prior to the Effective Time or (y)
any Ancillary Agreement to which each of the party requesting such access and
the party requested to grant such access are parties.
SECTION 4.3 REIMBURSEMENT; OTHER MATTERS. Except to the extent
otherwise contemplated by any Ancillary Agreement, a party providing Records
or access to information to the other party under this Article IV shall be
entitled to receive from the recipient, upon the presentation of invoices
therefor, payments for such amounts, relating to supplies, disbursements and
other out-of-pocket expenses, as may be reasonably incurred in providing such
Records or access to information.
-25-
SECTION 4.4 CONFIDENTIALITY. Each of (i) IMS and its Subsidiaries
and (ii) ST and its Subsidiaries shall not use or permit the use of (without
the prior written consent of the other) and shall keep, and shall cause its
consultants and advisors to keep, confidential all information concerning the
other parties in its possession, its custody or under its control (except to
the extent that (A) such information has been in the public domain through no
fault of such party or (B) such information has been later lawfully acquired
from other sources by such party or (C) this Agreement or any other Ancillary
Agreement or any other agreement entered into pursuant hereto permits the use
or disclosure of such information) to the extent such information (w) relates
to or was acquired during the period up to the Effective Time, (x) relates to
any Ancillary Agreement, (y) is obtained in the course of performing services
for the other party pursuant to any Ancillary Agreement, or (z) is based upon
or is derived from information described in the preceding clauses (w), (x) or
(y), and each party shall not (without the prior written consent of the
other) otherwise release or disclose such information to any other person,
except such party's auditors and attorneys, unless compelled to disclose such
information by judicial or administrative process or unless such disclosure
is required by law and such party has used commercially reasonable efforts to
consult with the other affected party or parties prior to such disclosure.
SECTION 4.5 PRIVILEGED MATTERS. The parties hereto recognize that
legal and other professional services that have been and will be provided
prior to the Distribution Date have been and will be rendered for the benefit
of each of IMS, the members of the IMS Group and the members of the ST Group,
and that each of IMS, the members of the IMS Group and the members of the ST
Group should be deemed to be the client for the purposes of asserting all
privileges which may be asserted under applicable law. To allocate the
interests of each party in the information as to which any party is entitled
to assert a privilege, the parties agree as follows:
(a) IMS shall be entitled, in perpetuity, to control the assertion
or waiver of all privileges in connection with privileged information which
relates solely to the IMS Business, whether or not the privileged information is
in the possession of or under the control of IMS or ST. IMS shall also be
entitled, in perpetuity, to control the assertion or waiver of all privileges in
connection with privileged information that relates solely to the subject matter
of any claims constituting IMS Liabilities, now pending or which may be asserted
in the future, in any lawsuits or other proceedings initiated against or by IMS,
whether or not the privileged information is in the possession of or under the
control of IMS or ST.
(b) ST shall be entitled, in perpetuity, to control the assertion
or waiver of all privileges in connection with privileged information which
relates solely to the ST Business, whether or not the privileged information is
in the possession of or under the control of IMS or ST. ST shall also be
entitled, in perpetuity, to control the assertion or waiver of all privileges in
connection with privileged information which relates solely to the subject
matter of any claims constituting ST Liabilities, now pending or which may be
asserted in the future, in any lawsuits or other proceedings initiated against
or by ST whether or not the privileged information is in the possession of or
under the control of IMS or ST.
(c) The parties hereto agree that they shall have a shared
privilege, with equal right to assert or waive, subject to the restrictions in
this Section 4.5, with respect to all privileges not allocated pursuant to the
terms of Sections 4.5(a) and (b). All privileges relating to any claims,
proceedings, litigation, disputes, or other matters which involve both IMS and
ST in respect of which both parties retain any responsibility or liability under
this Agreement, shall be subject to a shared privilege among them.
-26-
(d) No party hereto may waive any privilege which could be
asserted under any applicable law, and in which any other party hereto has a
shared privilege, without the consent of the other party, except to the extent
reasonably required in connection with any litigation with third-parties or as
provided in subsection (e) below. Consent shall be in writing, or shall be
deemed to be granted unless written objection is made within twenty (20) days
after notice upon the other party requesting such consent.
(e) In the event of any litigation or dispute between or among any
of the parties hereto, any party and a Subsidiary of another party hereto, or a
Subsidiary of one party hereto and a Subsidiary of another party hereto, either
such party may waive a privilege in which the other party has a shared
privilege, without obtaining the consent of the other party, provided that such
waiver of a shared privilege shall be effective only as to the use of
information with respect to the litigation or dispute between the parties and/or
their Subsidiaries, and shall not operate as a waiver of the shared privilege
with respect to third parties.
(f) If a dispute arises between or among the parties hereto or
their respective Subsidiaries regarding whether a privilege should be waived to
protect or advance the interest of any party, each party agrees that it shall
negotiate in good faith, shall endeavor to minimize any prejudice to the rights
of the other parties, and shall not unreasonably withhold consent to any request
for waiver by another party. Each party hereto specifically agrees that it will
not withhold consent to waiver for any purpose except to protect its own
legitimate interests.
(g) Upon receipt by any party hereto or by any Subsidiary thereof
of any subpoena, discovery or other request which arguably calls for the
production or disclosure of information subject to a shared privilege or as to
which another party has the sole right hereunder to assert a privilege, or if
any party obtains knowledge that any of its or any of its Subsidiaries' current
or former directors, officers, agents or employees have received any subpoena,
discovery or other requests which arguably calls for the production or
disclosure of such privileged information, such party shall promptly notify the
other party or parties of the existence of the request and shall provide the
other party or parties a reasonable opportunity to review the information and to
assert any rights it or they may have under this Section 4.5 or otherwise to
prevent the production or disclosure of such privileged information.
(h) The transfer of all Records and other information pursuant to
this Agreement is made in reliance on the agreement of IMS and ST, as set forth
in Sections 4.4 and 4.5, to maintain the confidentiality of privileged
information and to assert and maintain all applicable privileges. The access to
information being granted pursuant to Sections 4.1 and 4.2 hereof, the agreement
to provide witnesses and individuals pursuant to Sections 2.9 and 3.3 hereof,
the furnishing of notices and documents and other cooperative efforts
contemplated by Section 3.3 hereof, and the transfer of privileged information
between and among the parties and their respective Subsidiaries pursuant to this
Agreement shall not be deemed a waiver of any privilege that has been or may be
asserted under this Agreement or otherwise.
SECTION 4.6 OWNERSHIP OF INFORMATION. Any information owned by one
party or any of its Subsidiaries that is provided to a requesting party
pursuant to Article III or this Article IV 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.
-27-
SECTION 4.7 LIMITATION OF LIABILITY. (a) No party shall have any
liability to any other party in the event that any information exchanged or
provided pursuant to this Agreement which is an estimate or forecast, or
which is based on an estimate or forecast, is found to be inaccurate.
(b) Other than in connection with Section 2.2, no party or any
Subsidiary thereof shall have any liability or claim against any other party or
any Subsidiary of any other party based upon, arising out of or resulting from
any agreement, arrangement, course of dealing or understanding existing on or
prior to the Distribution Date (other than this Agreement or any Ancillary
Agreement or any agreement entered into in connection herewith or in order to
consummate the transactions contemplated hereby or thereby), unless such
agreement, arrangement, course of dealing or understanding is listed on Schedule
4.7(b) hereto, and any such liability or claim, whether or not in writing, which
is not reflected on such Schedule, is hereby irrevocably cancelled, released and
waived.
SECTION 4.8 OTHER AGREEMENTS PROVIDING FOR EXCHANGE OF INFORMATION.
The rights and obligations granted under this Article IV are subject to any
specific limitations, qualifications or additional provisions on the sharing,
exchange or confidential treatment of information set forth in any Ancillary
Agreement.
ARTICLE V
ADMINISTRATIVE SERVICES
SECTION 5.1 PERFORMANCE OF SERVICES. Beginning on the Distribution
Date, each party will provide, or cause one or more of its Subsidiaries to
provide, to the other party and its Subsidiaries such services on such terms
as may be set forth in the Corporate Services Agreement. Except as otherwise
set forth in the Corporate Services Agreement or any Schedule thereto, the
party that is to provide the services (the "Provider") will use (and will
cause its Subsidiaries to use) commercially reasonable efforts to provide
such services to the other party (the "Recipient") and its Subsidiaries in a
satisfactory and timely manner and as further specified in such Corporate
Services Agreement.
SECTION 5.2 INDEPENDENCE. Unless otherwise agreed in writing, all
employees and representatives of the Provider providing the Scheduled
services to the Recipient will be deemed for purposes of all compensation and
employee benefits matters to be employees or representatives of the Provider
and not employees or representatives of the Recipient. In performing such
services, such employees and representatives will be under the direction,
control and supervision of the Provider (and not the Recipient) and the
Provider will have the sole right to exercise all authority with respect to
the employment (including, without limitation, termination of employment),
assignment and compensation of such employees and representatives.
SECTION 5.3 NON-EXCLUSIVITY. Nothing in this Agreement precludes
any party from obtaining, in whole or in part, services of any nature that
may be obtainable from the other party from its own employees or from
providers other than the other party.
ARTICLE VI
DISPUTE RESOLUTION
SECTION 6.1 NEGOTIATION. In the event of a controversy, dispute or
claim arising out of, in connection with, or in relation to the
interpretation, performance, nonperformance, validity
-28-
or breach of this Agreement or otherwise arising out of, or in any way
related to this Agreement or the transactions contemplated hereby, including,
without limitation, any claim based on contract, tort, statute or
constitution (but excluding any controversy, dispute or claim arising out of
any agreement relating to the use or lease of real property if any third
party is a party to such controversy, dispute or claim) (collectively,
"Agreement Disputes"), the Agreement Dispute shall be negotiated in good
faith for a reasonable period of time by the local managers concerned (or the
equivalent thereof) of the parties, provided that such reasonable period of
time shall not exceed 15 days from the time the parties began such
negotiations. Should there be no resolution of an Agreement Dispute within a
reasonable period of time by such local managers (or the equivalent thereof)
of the parties, the Agreement Dispute shall be negotiated in good faith for a
reasonable period of time by the general counsels of the parties, provided
that such reasonable period of time shall not, unless otherwise agreed by the
parties in writing, exceed 15 days from the time the general counsels began
such negotiations. Should there be no resolution of an Agreement Dispute
within a reasonable period of time by the general counsels of the parties,
the Agreement Dispute shall be negotiated in good faith for a reasonable
period of time by the chief executive officers of the parties, or their
respective designees, provided that such reasonable period of time shall not,
unless otherwise agreed by the parties in writing, exceed 30 days from the
time the chief executive officers of the parties, or their respective
designees, began such negotiations; provided further that in the event of any
arbitration in accordance with Section 6.2 hereof, the parties shall not
assert the defenses of statute of limitations and laches arising for the
period beginning after the date the parties began negotiations hereunder, and
any contractual time period or deadline under this Agreement or any Ancillary
Agreement to which such Agreement Dispute relates shall not be deemed to have
passed until such Agreement Dispute has been resolved.
SECTION 6.2 ARBITRATION. If after such reasonable period such local
managers concerned (or the equivalent thereof), general counsels or chief
executive officers, or their respective designees are unable to settle such
Agreement Dispute (and in any event, unless otherwise agreed in writing by
the parties, after 60 days have elapsed from the time the parties began such
negotiations), such Agreement Dispute shall be determined, at the request of
any party, by arbitration conducted in New York City, before and in
accordance with the then-existing International Arbitration Rules of the
American Arbitration Association (the "Rules"). In any dispute between the
parties hereto, the number of arbitrators shall be one. Any judgment or award
rendered by the arbitrator shall be final, binding and nonappealable (except
upon grounds specified in 9 U.S.C. ss.10(a) as in effect on the date hereof).
If the parties are unable to agree on the arbitrator, the arbitrator shall be
selected in accordance with the Rules; provided that the arbitrator shall be
a U.S. national. Any controversy concerning whether an Agreement Dispute is
an arbitrable Agreement Dispute, whether arbitration has been waived, whether
an assignee of this Agreement is bound to arbitrate, or as to the
interpretation of enforceability of this Article VI shall be determined by
the arbitrator. In resolving any dispute, the parties intend that the
arbitrator apply the substantive laws of the State of New York, without
regard to the choice of law principles thereof. The parties intend that the
provisions to arbitrate set forth herein be valid, enforceable and
irrevocable. The parties agree to comply with any award made in any such
arbitration proceeding that has become final in accordance with the Rules and
agree to enforcement of or entry of judgment upon such award, by any court of
competent jurisdiction, including (a) the Supreme Court of the State of New
York, New York County, or (b) the United States District Court for the
Southern District of New York, in accordance with Section 8.17 hereof. The
arbitrator shall be entitled, if appropriate, to award any remedy in such
proceedings, including, without limitation, monetary damages, specific
performance and all other forms of legal and equitable relief; provided,
however, the arbitrator shall not be entitled to award punitive damages.
Without limiting the provisions of the Rules, unless otherwise agreed in
writing by or
-29-
among the parties or permitted by this Agreement, the parties shall keep
confidential all matters relating to the arbitration or the award, provided such
matters may be disclosed (i) to the extent reasonably necessary in any
proceeding brought to enforce the award or for entry of a judgment upon the
award and (ii) to the extent otherwise required by law. Notwithstanding Article
32 of the Rules, the party other than the prevailing party in the arbitration
shall be responsible for all of the costs of the arbitration, including legal
fees and other costs specified by such Article 32. Nothing contained herein is
intended to or shall be construed to prevent any party, in accordance with
Article 22(3) of the Rules or otherwise, from applying to any court of competent
jurisdiction for interim measures or other provisional relief in connection with
the subject matter of any Agreement Disputes.
SECTION 6.3 CONTINUITY OF SERVICE AND PERFORMANCE. Unless otherwise
agreed in writing, the parties will continue to provide service and honor all
other commitments under this Agreement and each Ancillary Agreement during
the course of dispute resolution pursuant to the provisions of this Article
VI with respect to all matters not subject to such dispute, controversy or
claim.
ARTICLE VII
INSURANCE
SECTION 7.1 POLICIES AND RIGHTS INCLUDED WITHIN ASSETS; ASSIGNMENT
OF POLICIES. (a) POLICY RIGHTS. The ST Assets shall include (i) any and all
rights of an insured party under each of the Shared Policies, subject to the
terms of such Shared Policies and any limitations or obligations of ST
contemplated by this Article VII, specifically including rights of indemnity
and the right to be defended by or at the expense of the insurer, with
respect to all claims, suits, actions, proceedings, injuries, losses,
liabilities, damages and expenses incurred or claimed to have been incurred
prior to the Distribution Date by any party in or in connection with the
conduct of the ST Business or, to the extent any claim is made against ST or
any of its Subsidiaries, the conduct of the IMS Business, and which claims,
suits, actions, proceedings, injuries, losses, liabilities, damages and
expenses may arise out of an insured or insurable occurrence under one or
more of such Shared Policies.
(b) ASSIGNMENT OF SHARED POLICIES. Subject to the terms and
conditions hereof, IMS hereby assigns, transfers and conveys to ST all of IMS'
right, title and interest in and to any and all of the Shared Policies,
including, without limitation, the right of indemnity, the right to be defended
by or at the expense of the insurer and the right to any applicable Insurance
Proceeds thereunder; and IMS and ST shall use their commercially reasonable
efforts to obtain any required consents of insurers to the assignment
contemplated by this paragraph.
SECTION 7.2 POST-DISTRIBUTION DATE CLAIMS. If, subsequent to the
Distribution Date, any person shall assert a claim against ST or any of its
Subsidiaries (including, without limitation, where ST or its Subsidiaries are
joint defendants with other persons) with respect to any claim, suit, action,
proceeding, injury, loss, liability, damage or expense incurred or claimed to
have been incurred prior to the Distribution Date in or in connection with
the conduct of the ST Business or, to the extent any claim is made against ST
or any of its Subsidiaries (including, without limitation, where ST or its
Subsidiaries are joint defendants with other persons), in connection with the
conduct of the IMS Business, and which claim, suit, action, proceeding,
injury, loss, liability, damage or expense may arise out of an insured or
insurable occurrence under one or more of the Shared Policies, IMS shall, at
the time such claim is asserted, to the extent any such Policy may require
that Insurance Proceeds thereunder be collected directly by the named insured
or anyone other than the party against whom the Insured Claim is asserted, be
-30-
deemed to designate, without need of further documentation, ST as the agent and
attorney-in-fact to assert and to collect any related Insurance Proceeds under
such Shared Policy.
SECTION 7.3 ADMINISTRATION; OTHER MATTERS. (a) ADMINISTRATION. From
and after the Distribution Date, IMS shall be responsible for (i) Insurance
Administration of the Shared Policies and (ii) Claims Administration under
such Shared Policies with respect to IMS Liabilities and ST Liabilities;
provided that the assumption of such responsibilities by ST is in no way
intended to limit, inhibit or preclude any right to insurance coverage for
any Insured Claim of a named insured under such Policies as contemplated by
the terms of this Agreement; provided further that ST's assumption of the
administrative responsibilities for the Shared Policies shall not relieve the
party submitting any Insured Claim of the primary responsibility for
reporting such Insured Claim accurately, completely and in a timely manner or
of such party's authority to settle any such Insured Claim within any period
permitted or required by the relevant Policy; and provided further that all
direct or indirect communication with insurers relating to the Shared
Policies shall be conducted by IMS. IMS may discharge its administrative
responsibilities under this Section 7.3 by contracting for the provision of
services by independent parties. Each of the parties hereto shall administer
and pay any costs relating to defending its respective Insured Claims under
Shared Policies to the extent such defense costs are not covered under such
Policies and shall be responsible for obtaining or reviewing the
appropriateness of releases upon settlement of its respective Insured Claims
under Shared Policies. The disbursements, out-of-pocket expenses and direct
and indirect costs of employees or agents of ST relating to Claims
Administration and Insurance Administration contemplated by this Section
7.3(a) shall be treated in accordance with the terms of the Corporate
Services Agreement, if still in effect with respect to insurance and risk
management, or, if the Corporate Services Agreement shall no longer be in
effect with respect to insurance and risk management, then each of IMS and ST
shall be responsible for its own Claims Administration and Insurance
Administration.
(b) EXCEEDING POLICY LIMITS. Except as set forth in this Section
7.3(b), IMS and ST shall not be liable to one another for claims not reimbursed
by insurers for any reason not within the control of IMS or ST, as the case may
be, including, without limitation, coinsurance provisions, deductibles, quota
share deductibles, self-insured retentions, bankruptcy or insolvency of an
insurance carrier, Shared Policy limitations or restrictions, any coverage
disputes, any failure to timely claim by IMS or ST or any defect in such claim
or its processing, provided that ST shall be responsible for the amount of the
difference, if any, between the deductible set forth in any Shared Policy and
the deductible allocable to IMS as set forth in Schedule 7.3(b) hereto.
(c) ALLOCATION OF INSURANCE PROCEEDS. Insurance Proceeds received
with respect to claims, costs and expenses under the Shared Policies shall be
paid to IMS, which shall thereafter administer the Shared Policies by paying the
Insurance Proceeds, as appropriate, to ST with respect to ST Liabilities and to
IMS with respect to IMS Liabilities. Payment of the allocable portions of
indemnity costs of Insurance Proceeds resulting from such Policies will be made
by IMS to the appropriate party upon receipt from the insurance carrier. In the
event that the aggregate limits on any Shared Policies are exceeded by the
aggregate of outstanding Insured Claims by both of the parties hereto, the
parties agree to allocate the Insurance Proceeds received thereunder based upon
their respective percentage of the total of their bona fide claims which were
covered under such Shared Policy (their "allocable portion of Insurance
Proceeds"), and any party who has received Insurance Proceeds in excess of such
party's allocable portion of Insurance Proceeds shall pay to the other party the
appropriate amount so that each party will have received its allocable portion
of Insurance Proceeds pursuant hereto. Each of the parties agrees to use
commercially reasonable efforts to maximize available coverage under those
Shared Policies applicable to it, and to take all commercially reasonable steps
to recover from all other
-31-
responsible parties in respect of an Insured Claim to the extent coverage limits
under a Shared Policy have been exceeded or would be exceeded as a result of
such Insured Claim.
(d) ALLOCATION OF DEDUCTIBLES. In the event that both parties have
bona fide claims under any Shared Policy for which a deductible is payable, the
parties agree that the aggregate amount of the deductible paid shall be borne by
the parties in the same proportion which the Insurance Proceeds received by each
such party bears to the total Insurance Proceeds received under the applicable
Shared Policy (their "allocable share of the deductible"), and any party who has
paid more than such share of the deductible shall be entitled to receive from
the other party an appropriate amount so that each party has borne its allocable
share of the deductible pursuant hereto. For purposes of this Section 7.3(d),
the amount of the relevant deductible under any Shared Policy shall be that set
forth in Schedule 7.3(b) hereto.
(e) Effective as of the Distribution Date, each of ST and IMS
shall be responsible for its applicable deductible for workers' compensation,
general liability and automobile liability claims as set forth in Schedule
7.3(e).
SECTION 7.4 AGREEMENT FOR WAIVER OF CONFLICT AND SHARED DEFENSE. In
the event that Insured Claims of both of the parties hereto exist relating to
the same occurrence, the parties shall jointly defend and waive any conflict
of interest necessary to the conduct of the joint defense. Nothing in this
Article VII shall be construed to limit or otherwise alter in any way the
obligations of the parties to this Agreement, including those created by this
Agreement, by operation of law or otherwise.
SECTION 7.5 COOPERATION. The parties agree to use their
commercially reasonable efforts to cooperate with respect to the various
insurance matters contemplated by this Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1 COMPLETE AGREEMENT; CONSTRUCTION. This Agreement,
including the Exhibits and Schedules, and the Ancillary Agreements shall
constitute the entire agreement between the parties with respect to the
subject matter hereof and shall supersede all previous negotiations,
commitments and writings with respect to such subject matter. In the event of
any inconsistency between this Agreement and any Schedule hereto, the
Schedule shall prevail. Other than Section 2.1(j), Section 2.7, Section 4.5
and Article VI, which shall prevail over any inconsistent or conflicting
provisions in any Ancillary Agreement, notwithstanding any other provisions
in this Agreement to the contrary, in the event and to the extent that there
shall be a conflict between the provisions of this Agreement and the
provisions of any Ancillary Agreement, such Ancillary Agreement shall control.
SECTION 8.2 ANCILLARY AGREEMENTS. Subject to the last sentence of
Section 8.1, this Agreement is not intended to address, and should not be
interpreted to address, the matters specifically and expressly covered by the
Ancillary Agreements.
SECTION 8.3 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more such counterparts have
been signed by each of the parties and delivered to the other parties.
-32-
SECTION 8.4 SURVIVAL OF AGREEMENTS. Except as otherwise
contemplated by this Agreement, all covenants and agreements of the parties
contained in this Agreement shall survive the Distribution Date.
SECTION 8.5 EXPENSES. Except as set forth on Schedule 8.5 or as
otherwise contemplated in this Agreement or any Ancillary Agreement, all
costs and expenses incurred and for which invoices have been submitted,
whether before or after the Distribution Date, in connection with the
preparation, execution, delivery and required implementation of this
Agreement and any Ancillary Agreement, the Information Statement (including
any registration statement on Form 10 of which such Information Statement may
be a part) and the Distribution and the consummation of the transactions
contemplated thereby shall be charged to and paid by IMS.
SECTION 8.6 PAYMENTS. Except as otherwise contemplated in this
Agreement or any Ancillary Agreement, all payments to be made by IMS or ST
under this Agreement shall be made in United States dollars within the United
States.
SECTION 8.7 NOTICES. All notices and other communications hereunder
shall be in writing and hand delivered or mailed by registered or certified
mail (return receipt requested) or sent by any means of electronic message
transmission with delivery confirmed (by voice or otherwise) to the parties
at the following addresses (or at such other addresses for a party as shall
be specified by like notice) and will be deemed given on the date on which
such notice is received:
(i) if to IMS, to:
IMS Health Incorporated
000 Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: General Counsel; and
(ii) if to ST, to:
Synavant Inc.
0000 Xxxxxxxxx Xx., XX, Xxxxx 0000
Xxxxxxx, XX 00000
Telecopy: (404) 841-______
Attn: Chief Financial Officer.
SECTION 8.8 WAIVERS. The failure of any party to require strict
performance by any other party of any provision in this Agreement will not
waive or diminish that party's right to demand strict performance thereafter
of that or any other provision hereof.
SECTION 8.9 AMENDMENTS. Subject to the terms of Section 8.12
hereof, this Agreement may not be modified or amended except by an agreement
in writing signed by each of the parties hereto.
-33-
SECTION 8.10 ASSIGNMENT. (a) This Agreement shall not be assignable,
in whole or in part, directly or indirectly, by any party hereto without the
prior written consent of the other parties hereto, and any attempt to assign
any rights or obligations arising under this Agreement without such consent
shall be void.
(b) IMS will not distribute to its stockholders any interest in
any IMS Business Entity, by way of a spin-off distribution, split-off or
exchange of interests in a IMS Business Entity for any interest in IMS held by
IMS stockholders, or any similar transaction or transactions, unless the
distributed IMS Business Entity undertakes to ST to be jointly and severally
liable for all IMS Liabilities hereunder.
(c) ST will not distribute to its stockholders any interest in any
ST Business Entity, by way of a spin-off distribution, split-off or exchange of
interests in a ST Business Entity for any interest in ST held by ST
stockholders, or any similar transaction or transactions, unless the distributed
ST Business Entity undertakes to IMS to be jointly and severally liable for all
ST Liabilities hereunder.
SECTION 8.11 SUCCESSORS AND ASSIGNS. The provisions to this
Agreement shall be binding upon, inure to the benefit of and be enforceable
by the parties and their respective successors and permitted assigns.
SECTION 8.12 TERMINATION. This Agreement (including, without
limitation, Article III 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 IMS without the approval of ST or the shareholders
of IMS. 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 Article III shall not be terminated
or amended after the Distribution in respect of the third party beneficiaries
thereto without the consent of such persons.
SECTION 8.13 SUBSIDIARIES. Each of the parties hereto shall cause to
be performed, and hereby guarantees the performance of, all actions,
agreements and obligations set forth herein to be performed by any Subsidiary
of such party or by any entity that is contemplated to be a Subsidiary of
such party on and after the Distribution Date.
SECTION 8.14 THIRD PARTY BENEFICIARIES. Except as provided in
Article III relating to Indemnitees, this Agreement is solely for the benefit
of the parties hereto and their respective Subsidiaries and Affiliates and
should not be deemed to confer upon third parties any remedy, claim,
liability, reimbursement, claim of action or other right in excess of those
existing without reference to this Agreement.
SECTION 8.15 TITLE AND HEADINGS. Titles and headings to sections
herein are inserted for the convenience of reference only and are not
intended to be a part of or to affect the meaning or interpretation of this
Agreement.
SECTION 8.16 EXHIBITS AND SCHEDULES. The Exhibits and Schedules
shall be construed with and as an integral part of this Agreement to the same
extent as if the same had been set forth verbatim herein.
SECTION 8.17 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
-34-
YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW
YORK.
SECTION 8.18 CONSENT TO JURISDICTION. Without limiting the
provisions of Article VI hereof, each of the parties irrevocably submits to
the exclusive jurisdiction of (a) the Supreme Court of the State of New York,
New York County, and (b) the United States District Court for the Southern
District of New York, for the purposes of any suit, action or other
proceeding arising out of this Agreement or any transaction contemplated
hereby. Each of the parties agrees to commence any action, suit or proceeding
relating hereto either in the United States District Court for the Southern
District of New York or if such suit, action or other proceeding may not be
brought in such court for jurisdictional reasons, in the Supreme Court of the
State of New York, New York County. Each of the parties further agrees that
service of any process, summons, notice or document by U.S. registered mail
to such party's respective address set forth above shall be effective service
of process for any action, suit or proceeding in New York with respect to any
matters to which it has submitted to jurisdiction in this Section 8.18. Each
of the parties irrevocably and unconditionally waives any objection to the
laying of venue of any action, suit or proceeding arising out of this
Agreement or the transactions contemplated hereby in (i) the Supreme Court of
the State of New York, New York County, or (ii) the United States District
Court for the Southern District of New York, and hereby further irrevocably
and unconditionally waives and agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been
brought in an inconvenient forum.
SECTION 8.19 SEVERABILITY. In the event any one or more of the
provisions contained in this Agreement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein and therein shall not in any way be
affected or impaired thereby. The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions, the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.
-35-
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.
IMS HEALTH INCORPORATED
By:_______________________________
Name:
Title:
SYNAVANT INC.
By:________________________________
Name:
Title:
