EXHIBIT 10.5
PURCHASE AND SALE
AGREEMENT
DATED , 1995
BETWEEN
HAFSLUND NYCOMED AS
AS SELLER
AND
NYCOMED AS
AS PURCHASER
in respect of the sale by Hafslund Nycomed AS
of its Medical Businesses
to Nycomed AS
TABLE OF CONTENTS
1. INTERPRETATION..................................................... 2
1.1 Interpretation..................................................... 2
1.2 Definitions........................................................ 2
2. SALE AND PURCHASE.................................................. 7
3. THE MEDICAL BUSINESSES CLOSING BALANCE SHEET/ THE
PURCHASE PRICE CREDIT CALCULATION / THE CONSOLIDATED
ENERGY CLOSING BALANCE SHEET....................................... 8
4. CERTAIN PROVISIONS REGARDING THE SELLER'S LOANS AND
FINANCIAL AGREEMENTS............................................... 8
5. THE RETAINED WORKING CAPITAL....................................... 9
6. PENSIONS AND BENEFITS.............................................. 11
7. INDEMNIFICATION/APPORTIONMENT...................................... 12
8. THE CLOSING ....................................................... 13
9. CONDITIONS PRECEDENT............................................... 14
10. MISCELLANEOUS...................................................... 14
10.1 Service Requirements............................................... 14
10.2 Employees.......................................................... 14
10.3 Change of Name..................................................... 15
10.4 No Recourse........................................................ 15
10.5 Expenses........................................................... 15
10.6 Further Assurances; Cooperation.................................... 15
10.7 Post Closing....................................................... 16
10.8 Governing Law...................................................... 16
10.9 English Language................................................... 16
EXHIBITS
1. DESCRIPTION OF ENERGY COMPANIES
2. CORPORATE EMPLOYEES
3. LIST OF MEDICAL COMPANIES
4. CONTINGENT TAX MATTERS
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THIS AGREEMENT is entered into on this day of , 1995
Between:
(1) HAFSLUND NYCOMED AS, a Norwegian joint stock limited company having
its registered office at [ADDRESS] ("SELLER"); and
(2) NYCOMED AS, a Norwegian joint stock limited company having
its registered office at [ADDRESS] ("PURCHASER")
WHEREAS:
A. The Purchaser is a wholly owned subsidiary of the Seller to be
capitalised by the Seller with an initial share capital of NOK 150,000
and to be further capitalised by an increase in capitalization in an
amount equal to the Book Value of the Transferred Assets (as
hereinafter defined) less the sum of (i) the Book Value of the
Transferred Liabilities (as hereinafter defined), and (ii) NOK 150,000.
B. Pursuant to a transaction agreement dated as of October 18, 1995 (the
"TRANSACTION AGREEMENT"), made between the Seller, IVAX Corporation, a
Florida corporation ("IVAX"), and IVAX NYCOMED CORPORATION, a Florida
corporation, it has been agreed that the Seller and IVAX will combine
their respective businesses (other than the Energy Business, as
hereinafter defined) in a "merger of equals" transaction to be effected
as set out in the Transaction Agreement.
C. The Seller believes that the Energy Business which will be retained by
the Seller pursuant to the terms of this Agreement is in terms of
debt-equity ratio, working capital and other characteristics consistent
with the operating history of such business as operated by the Seller.
D. Under the terms of the Transaction Agreement, the Seller has agreed to
sell and transfer to the Purchaser the Seller's businesses, assets and
liabilities, other than the Energy Business and the assets and
liabilities related to the Energy Business.
E. Under the terms of the Transaction Agreement and pursuant to a transfer
agreement dated as of the date hereof, the Seller's subsidiary A/S
Vamma Fossekompagni will transfer to the Purchaser all of its shares in
Hafslund Invest a.s.
F. Under the terms of the Transaction Agreement and pursuant to a transfer
agreement dated as of the date hereof, the Seller's subsidiary Hafslund
Eiendom AS will transfer to the Seller 15% of its net claim for a
refund of taxes paid in connection with the disposal of Unitor AS
Shares.
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G. The parties hereto have agreed to enter into this Agreement to
effect the purchase and sale described in Recital D above.
NOW THEREFORE, the parties hereby agree as follows:
1. INTERPRETATION
1.1 INTERPRETATION
1.1.1 Where used herein or in any amendment or supplement hereto,
unless the context otherwise requires, words and phrases
defined in the Recitals hereto and Article 1.2 shall have the
meaning set out therein.
1.1.2 Headings are for convenience of reference only and shall not
affect the construction or interpretation hereof.
1.1.3 Words importing the singular include the plural and vice versa
and words importing gender include all genders.
1.2 DEFINITIONS
1.2.1 The following terms, when used herein, shall have the meanings
ascribed thereto in the Transaction Agreement:
"business day", "Effective Time" and "Medical Businesses".
1.2.2 When used herein, the following terms shall have the meanings
set out below unless the context otherwise requires:
"BOOK VALUE" means the book value as shown on the Medical Businesses
Closing Balance Sheet or the Consolidated Energy Closing Balance Sheet.
"CLOSING" shall have the meaning set forth in Article 8.
"COLLECTIVE PLANS" shall have the meaning set forth in Article 6.1.
"CONSOLIDATED ENERGY CLOSING BALANCE SHEET" shall have the meaning set
forth in Article 3.1.
"CONTINGENT TAX CLAIM" shall have the meaning set forth in Article 7.5.
"CORPORATE EMPLOYEES" means the employees of the Seller whose
employment is common to the group, as listed in Exhibit 2.
3
"ENERGY BUSINESS" means the Seller's and the Energy Companies'
Norwegian business of generating hydroelectric power and transmitting,
buying and selling electric power.
"ENERGY COMPANIES" means those of the Seller's subsidiaries listed in
Exhibit 1 hereto which constitute all the subsidiaries of the Seller
engaged in the Energy Business.
"EXCLUDED ASSETS" means 15% of the claim by the Seller for repayment
with interest of a tax amount of approximately NOK 85,000,000
previously paid to cover a disputed tax assessment for Actinor AS for
the financial year 1985, and all of the Seller's assets Related To the
Energy Business and/or the Hafslund Manor, including, without
limitation, the following assets:
(i) accounts receivable Related To the Energy Business and/or
the Hafslund Manor,
(ii) inventories Related To the Energy Business and/or the
Hafslund Manor,
(iii) repurchased notes under the Hafslund a.s 1985/2015 loan in the
aggregate principal amount of NOK 91,698,000 presently held by
the Seller (or, in the case of repayment of any such notes
prior to the Closing, cash equal to the net repaid amount),
(iv) cash and bank deposits to the extent retained by the Seller
as part of the Retained Working Capital pursuant to
Article 5 below,
(v) real estate Related To the Energy Business and/or the
Hafslund Manor,
(vi) personal property Related To the Energy Business and/or
the Hafslund Manor,
(vii) patents, trademarks and other intellectual property rights
Related To the Energy Business and/or the Hafslund Manor,
(viii) rights under contracts Related To the Energy Business and/or
the Hafslund Manor,
(ix) all shares of the Energy Companies,
(x) accounts receivable from the Energy Companies,
(xi) insurance policies Related To the Energy Business and/or the
Hafslund Manor,
(xii) loans to the Retained Employees, furniture, office equipment
and relevant files and records primarily used by the Retained
Employees and all other assets Related To the Retained
Employees, and
(xiii) the books and records Related To the Energy Business.
4
"EXCLUDED LIABILITIES" means all of the Seller's liabilities Related To
the Energy Business and/or the Hafslund Manor, including, without
limitation, the following liabilities:
(i) accounts payable Related To the Energy Business and/or the
Hafslund Manor,
(ii) accrued taxes and other tax liabilities Related To the Energy
Business and/or the Hafslund Manor,
(iii) liabilities Related To present and future litigation or
arbitration and other known or unknown contingent liabilities
Related To the Energy Business and/or the Hafslund Manor,
(iv) liabilities under contracts Related To the Energy Business
and/or the Hafslund Manor,
(v) accounts payable to the Energy Companies,
(vi) the Retained Loan and such debt as may be included in the
calculation of the Retained Working Capital,
(vii) liabilities under insurance policies Related To the Energy
Business and/or the Hafslund Manor,
(viii) liability for deposits made by the Retained Employees with the
Seller, the liabilities allocated to the Seller pursuant to
Article 6 and all other liabilities Related To the Retained
Employees, and
(ix) all liabilities Related To the Excluded Assets.
"FUTURE ADJUSTMENT AMOUNT" shall have the meaning set forth in
Article 6.1.6.
"GAAP" means generally accepted accounting principles in Norway.
"HAFSLUND MANOR" means the Hafslund Manor and related farmland and
other real property in Sarpsborg, Norway.
"INDEMNIFIED LIABILITY" shall have the meaning set forth in
Article 7.1.
"INDEMNIFIED PARTY" shall have the meaning set forth in Article 7.1.
"INDEMNIFYING PARTY" shall have the meaning set forth in Article 7.1.
"MAINTENANCE CONSENTS" shall have the meaning set forth in Article 4.1.
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"MEDICAL BUSINESS CLOSING BALANCE SHEET" shall have the meaning set
forth in Article 3.1.
"MEDICAL COMPANIES" means those subsidiaries of the Seller listed in
Exhibit 3 hereto.
"PURCHASE PRICE CREDIT CALCULATION" shall have the meaning set forth in
Article 3.1.
"RETAINED EMPLOYEES" means employees of the Seller who after the
closing of the transactions contemplated by this Agreement and the
allocation of Corporate Employees provided for in Article 10.2 will
remain employees of the Seller.
"RETAINED LOAN" means the Hafslund a.s NOK 200,000,000 floating rate
Notes 1985/2015, outstanding amount as of 30 September 1995 NOK
160,000,000.
"RETAINED WORKING CAPITAL" shall mean the difference between the sum of
current assets and the sum of current liabilities shown on the
Consolidated Energy Closing Balance Sheet, except that for the purpose
of calculating the Retained Working Capital
(i) to the extent (a) expenses allocated to the Seller pursuant to
Article 4.4 and/or Article 10.5, (b) receipt of all or any
part of the Seller's 15% share of the claim of the Seller for
repayment with interest of a tax amount of approximately NOK
85,000,000 previously paid to cover a disputed tax assessment
for Actinor AS for the financial year 1985 and/or (c) the
Seller's 15% share of the liability for Contingent Tax Claims
pursuant to Article 7.5 have impacted the amount of any
current assets or current liabilities shown on the
Consolidated Energy Closing Balance Sheet, such items shall be
added back, and
(ii) assets and/or provisions reflecting the items referred to in
(i) above shall be disregarded.
"RELATED TO" means primarily related to, used primarily in connection
with or arising primarily out of.
"TRANSFER CONSENTS" shall have the meaning set forth in Article 4.3.1.
"TRANSFERRED ASSETS" means 85% of the claim by the Seller for repayment
of a tax amount of approximately NOK 85,000,000 previously paid to
cover a disputed tax assessment for Actinor AS for the financial year
1985, and all of the Seller's assets, except the Excluded Assets,
including, without limitation:
(i) accounts receivable,
(ii) inventories,
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(iii) all cash, bank deposits, commercial paper, notes, debentures,
bonds, receivables and shares except to the extent retained by
the Seller as part of the Retained Working Capital pursuant to
Article 5 below,
(iv) real estate,
(v) personal property,
(vi) patents, trademarks and other intellectual property rights,
(vii) rights under contracts,
(viii) rights under the Transferred Financial Instruments,
(ix) all shares of the Medical Companies, except the shares of
Hafslund Invest a.s. which will be transferred to the
Purchaser from A/S Vamma Fossekompagni pursuant to a separate
transfer agreement as provided in Recital E hereto,
(x) insurance policies,
(xi) loans to the Transferred Employees, furniture, office
equipment and files, the assets allocated to the Purchaser
pursuant to Article 6 and all other assets Related To the
Transferred Employees, and
(xii) the books and records Related To the Medical Business.
"TRANSFERRED EMPLOYEES" means employees of the Seller who after the
closing of the transactions contemplated by this Agreement and the
allocation of Corporate Employees provided for in Article 10.2 will be
employees of the Purchaser.
"TRANSFERRED FINANCIAL INSTRUMENTS" shall have the meaning set forth
in Article 4.3
"TRANSFERRED LIABILITIES" means all other liabilities of the Seller,
except the Excluded Liabilities, including, without limitation:
(i) accounts payable,
(ii) accrued taxes,
(iii) liabilities Related To present and future litigation and
arbitration and other known or unknown contingent liabilities,
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(iv) liabilities under contracts,
(v) all obligations for borrowed money, except the Retained Loan
and except to the extent included in the calculation of the
Retained Working Capital pursuant to Article 5 below,
(vi) liabilities under Transferred Financial Instruments,
(vii) liabilities under insurance policies,
(viii) liability for deposits made by the Transferred Employees with
the Seller, the liabilities allocated to the Seller pursuant
to Article 6 below and all other liabilities Related To the
Transferred Employees, and
(ix) all liabilities Related To the Transferred Assets.
"TRANSFERRED LOANS" shall have the meaning set forth in Article 4.3.
"UNFUNDED PLANS" shall have the meaning set forth in Article 6.2.
2. SALE AND PURCHASE
2.1 Subject to the terms and conditions hereof it is hereby agreed that at
the Closing, the Seller will sell and transfer to the Purchaser and the
Purchaser will purchase and assume, the Transferred Assets and the
Transferred Liabilities, all with effect at the Effective Time.
2.2 The total price payable by the Purchaser to the Seller (the "PURCHASE
PRICE") shall be the aggregate of the Book Value of the Transferred
Assets shown on the Seller's Closing Balance Sheet.
2.3 The Purchase Price shall be paid and satisfied as follows:
a. assumption of the Transferred Liabilities; and
b. payment in cash of NOK 150,000 on the Closing; and
c. the assumption by the Purchaser of an interest free obligation
(the "PURCHASE PRICE CREDIT") to pay an amount equal to the
Book Value of the Transferred Assets less the sum of (i) the
Book Value of the Transferred Liabilities and (ii) NOK 150,000
as further provided in Article 3 below, which shall be payable
within ten business days after the deliveries provided for in
Article 3.1 have been effected.
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2.4 The payment pursuant to Article 2.3 b above and the Purchase Price
Credit shall be expressed in NOK.
3. THE MEDICAL BUSINESSES CLOSING BALANCE SHEET/ THE PURCHASE PRICE
CREDIT CALCULATION / THE CONSOLIDATED ENERGY CLOSING BALANCE
SHEET
3.1 No later than 60 days after the Closing, the Seller shall deliver to
the Purchaser (i) an audited consolidated balance sheet (the "MEDICAL
BUSINESSES CLOSING BALANCE SHEET") reflecting the Transferred Assets
and the Transferred Liabilities as of the Effective Time, (ii) a
calculation of the Purchase Price Credit (the "PURCHASE PRICE CREDIT
CALCULATION"), and (iii) a consolidated audited balance sheet
reflecting the Excluded Assets and the Excluded Liabilities and the
assets and liabilities of the Energy Companies (the "CONSOLIDATED
ENERGY CLOSING BALANCE SHEET") as of the Effective Time. The Medical
Businesses Closing Balance Sheet shall be prepared in accordance with
US generally accepted accounting principles, and the Consolidated
Energy Closing Balance Sheet shall be prepared in accordance with GAAP
as historically applied by the Seller. The Medical Businesses Closing
Balance Sheet and the Consolidated Energy Closing Balance Sheet shall
be audited by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co. The Purchaser and the Seller shall
consult with respect to the preparation of the Medical Business Closing
Balance Sheet and the Consolidated Energy Closing Balance Sheet. To the
extent that the parties cannot agree on any item of such balance
sheets, such item shall be reflected as directed by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ &
Co.
3.2 The Medical Businesses Closing Balance Sheet, the Purchase Price Credit
Calculation and the Consolidated Energy Closing Balance Sheet delivered
to the Purchaser pursuant to Article 3.1 above shall, in the absence of
manifest error, be final and binding.
3.3 As promptly as practicable after December 31, 1995, the Seller shall
deliver to the Purchaser an audited Consolidated Energy Balance Sheet
as of December 31, 1995 and an audited Medical Business Balance Sheet
as of December 31, 1995.
4. CERTAIN PROVISIONS REGARDING THE SELLER'S LOANS AND FINANCIAL
AGREEMENTS
4.1 The Seller assumes the risk of obtaining the necessary consents and
making other necessary arrangements (the "MAINTENANCE CONSENTS") with
the counterparties to the Retained Loan in order for the Seller to
retain the same. In case the Seller does not obtain all of the
Maintenance Consents, the Seller undertakes to discharge any and all
liabilities and expenses associated with settling the Retained Loan.
4.2 If on the Closing (or on 28 February 1996 if the Closing does not occur
on or prior to such date) the difference between (i) the aggregate
amount of obligations for borrowed money which are shown as long term
liabilities on the Consolidated Energy Closing Balance Sheet and (ii)
NOK
9
91,698,000 (which is the principal amount of the notes referred to in
item (iii) of the definition of Excluded Assets) is less than NOK
312,500,000, then the Seller will use its reasonable best efforts to
raise other loans in an aggregate amount equal to such shortfall prior
to the Closing and will transfer an equivalent amount in cash to the
Purchaser at the Closing. If the Closing does not occur on or prior to
28 February 1996, the Seller undertakes not to make, and to cause the
Energy Companies not to make, any payments in respect of its
obligations for borrowed money which are long term liabilities other
than interest payments, repayments of principal and other payments that
are mandatory under the terms of such obligations and in particular not
to make any prepayments in respect of such obligations.
4.3 The following shall apply with respect to all loans to which the Seller
is a party that is not a Retained Loan (the "TRANSFERRED LOANS")
and all interest rate and currency swaps, forward contracts, futures,
currency options and other financial instruments (the "TRANSFERRED
FINANCIAL INSTRUMENTS") of the Seller:
4.3.1 The Purchaser assumes the risk of obtaining the necessary
consents and making other necessary arrangements (the
"TRANSFER CONSENTS") with the counterparties to the
Transferred Loan and the Transferred Financial Instruments in
order for the Purchaser to assume the same as contemplated by
Article 2.1 above.
4.3.2 In case the Purchaser does not obtain all of the Transfer
Consents related to the Transferred Loans, the Purchaser
undertakes to (i) discharge any and all liabilities and
expenses associated with settling such Transferred Loans at
the Effective Time and (ii) use its reasonable best efforts to
raise other loans in an aggregate amount at least sufficient
to refinance the Transferred Loans at the Effective Time.
4.3.3 In case the Purchaser does not obtain all of the Transfer
Consents related to the Transferred Financial Instruments, the
Purchaser undertakes to (i) discharge any and all liabilities
and expenses associated with settling such Transferred
Financial Instruments and (ii) assumes the risk of not being
able to enter into other similar financial agreements.
4.4 The Seller and the Purchaser will pay 15% and 85%, respectively, of all
costs in connection with the yield maintenance obligations under the
$227 millon Senior Notes of Seller issued in multiple series pursuant
to a Note Agreement dated November 2, 1994.
5. THE RETAINED WORKING CAPITAL
5.1 The following shall apply with respect to the Retained Working Capital:
5.1.1 To the extent the Retained Working Capital is a positive
figure, the Seller shall assume the liability for short term
loans that would otherwise be Transferred Liabilities in an
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aggregate amount equal to such positive figure. The provisions
set forth in Article 4.1 above shall apply, MUTATIS MUTANDIS,
with respect to such additional short term loans; and
5.1.2 To the extent the Retained Working Capital is a negative
figure, the Seller shall retain cash or cash equivalents in an
aggregate amount equal to such negative figure.
6. PENSIONS AND BENEFITS
6.1 The following shall apply to the rights and obligations under the
Seller's collective pension plans (the "COLLECTIVE PLANS"):
6.1.1 The Purchaser shall assume the liability for payment of
pension premiums and all other obligations arising out of the
Collective Plans insofar as such liabilities relate to the
Transferred Employees;
6.1.2 The Seller shall retain the liability for payment of pension
premiums and all other obligations arising out of the
Collective Plans insofar as such liabilities relate to (i) the
Retained Employees or (ii) non-employees who as of the date of
the Effective Time have a right to current or future pension
payments under the Collective Plans including any and all
Future Adjustment Amounts referred to in Article 6.1.6 below;
6.1.3 All beneficiaries under the Collective Plans shall maintain
without any change of their rights against the insurance
carrier under the Collective Plans;
6.1.4 The premium reserve ("PREMIERESERVEN") shall be allocated to
the Purchaser insofar as it relates to the Transferred
Employees;
6.1.5 The premium reserve ("PREMIERESERVEN") shall be allocated to
the Seller insofar as it relates to the Retained Employees;
6.1.6 An amount (the "FUTURE ADJUSTMENT AMOUNT") equal to the net
present value of increased premium payments by the Seller
expected to result from future adjustments of pensions to
non-employees who as of the date of the Effective Time have a
right to current or future pension payments under the
Collective Plans, shall be allocated to the Seller from the
premium fund ("PREMIEFOND"). The Future Adjustment Amount
shall be calculated by an actuarial expert agreed upon by both
parties hereto, applying such actuarial principles and
assumptions as in its discretion such expert considers
reasonable. Such calculation shall, in the absence of manifest
error, be final and binding on the parties;
6.1.7 Each of (i) the pro rata share of the additional reserve
("ANDEL TILLEGGSAVSETNING"), (ii) the pro rata share of net
unrealized gains ("ANDEL KURSRESERVE"), (iii) the balance of
the
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premium fund after the allocation of the Future Adjustment
Amount to the Seller pursuant to in Article 6.1.6, (iv) the
guarantee reserve ("GARANTIRESERVE"), (v) the pension
adjustment fund ("PENSJONSREGULERINGSFOND") and (vi) the
earnings fund ("OVERSKUDDSFOND") shall be allocated between
the Seller and the Purchaser such that the proportion of the
part allocated to the Seller to the part allocated to the
Purchaser shall be the same as the proportion of the part of
the premium reserve allocated to the Seller to the part of the
premium reserve allocated to the Purchaser.
6.2 The following principles shall apply to assets and liabilities related
to all pension plans and/or individual pension agreements other than
the Collective Plans (the "UNFUNDED PLANS"), it being understood that
such plans and/or individual agreements comprise both unfunded and
partly-funded pension liabilities:
6.2.1 The Purchaser shall assume the liability for all obligations
arising out of the Unfunded Plans insofar as such liabilities
relate to (i) the Transferred Employees and (ii) former
employees, other than those whose employment was Related To
the Energy Business and/or the Hafslund Manor, and their
relatives.
6.2.2 The Seller shall retain the liability for all obligations
arising out of the Unfunded Plans insofar as such liabilities
relate to (i) Retained Employees and (ii) former employees
whose employment was Related To the Energy Business and/or the
Hafslund Manor and their relatives.
6.2.3 All assets related to the Unfunded Plans shall be transferred
to the Purchaser insofar as they relate to the persons
referred to in Article 6.2.1;
6.2.4 All assets related to the Unfunded Plans shall be retained by
the Seller insofar as they relate to persons referred to in
Article 6.2.2.
7. INDEMNIFICATION/APPORTIONMENT
7.1 If a party (an "INDEMNIFIED PARTY") discharges a liability (an
"INDEMNIFIED LIABILITY") for which the other party (an "INDEMNIFYING
PARTY") is liable pursuant to the terms and conditions of this
Agreement, then the Indemnifying Party shall, subject to the terms and
provisions set forth below in this Article 7 promptly upon demand
indemnify the Indemnified Party to the extent of the Indemnifying
Party's liability for the Indemnified Liability together with the
Indemnified Party's reasonable expenses related to the defense of the
Indemnified Liability.
7.2 If an Indemnified Liability is asserted in writing against an
Indemnified Party, then the Indemnified Party shall notify the
Indemnifying Party in writing in reasonable detail of the amount and
nature of the Indemnified Liability, the identity of the claimant and
the reason why the Indemnified Party believes that the Indemnifying
Party is liable for the Indemnified Liability.
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7.3 If the Indemnifying Party accepts liability for the Indemnified
Liability in its entirety, the Indemnifying Party shall have the right
to assume the defence thereof. If the Indemnifying Party only accepts
liability for part of the Indemnified Liability (whether or not the
Indemnified Party believes that the Indemnifying Party is liable for
the Indemnified Liability in its entirety), or the Indemnifying Party
does not accept any liability in respect of the Indemnified Liability,
then the Indemnified Party shall have the right, but not the
obligation, to assume the defense thereof, provided that if the
Indemnified Party does not take reasonable steps to defend the
Indemnified Liability, then the Indemnifying Party shall have the right
to assume the defence thereof.
7.4 If the Indemnified Party does not notify the Indemnifying Party of the
Indemnified Liability in accordance with the provisions set forth in
Article 7.2, then the Indemnified Party shall retain its right to
indemnification except to the extent that the Indemnifying Party can
demonstrate that it was prejudiced by such failure.
7.5 If a claim (a "CONTINGENT TAX CLAIM") arising out of any of the
contingent tax matters listed in Exhibit 4 is asserted against either
of the parties, any of the Medical Companies or any of the Energy
Companies, the following shall apply:
7.5.1 If a Contingent Tax Claim is asserted against the Seller or
any of the Energy Companies, the Seller shall notify the
Purchaser of such Contingent Tax Claim and send the Purchaser
copies of all documents in its and the Energy Companies'
possession relevant to such Contingent Tax Claim to the
Purchaser.
7.5.2 The Purchaser shall assume the defence of Contingent Tax
Claims and shall promptly keep the Seller informed of all
material developments relative thereto. The Purchaser shall,
after having duly consulted with the Seller, make all
decisions in its sole discretion as to how to defend and
whether to settle Contingent Tax Claims. The Seller shall
promptly upon demand indemnify the Purchaser for 15% of the
Purchaser's out-of-pocket expenses incurred from time to time
as a result for the defence of Contingent Tax Claims.
7.5.3 If the Purchaser or a Medical Company makes a payment in
respect of a Contingent Tax Claim which has not been finally
assessed, the Seller shall promptly upon demand pay on account
an amount equal to 15% of such payment to the Purchaser. If
the Seller or an Energy Company makes a payment in respect of
a Contingent Tax Claim which has not been finally assessed,
the Purchaser shall promptly upon demand pay on account an
amount equal to 85% of such payment to the Purchaser.
7.5.4 If the Purchaser or a Medical Company discharges any
Contingent Tax Claim that is definitively assessed, i.e., the
subject of a final, administrative decision or judgement, or a
settlement to which the Purchaser shall have agreed in its
sole discretion, it shall be entitled to receive
indemnification from the Seller; and if the Seller or any
Energy
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Company discharges any definitively assessed Contingent Tax
Claim is shall be entitled to receive indemnification from the
Purchaser. The amount of such indemnification shall be
calculated so that the Seller and the Energy Companies shall
ultimately bear 15%, and the Purchaser and the Medical
Companies shall ultimately bear 85%, of the total tax payments
made as a result such Contingent Tax Claim after deduction of
any tax refunds received as a result of adjustments made in
connection with the same Contingent Tax Claim. To the extent
such indemnification payments are treated as taxable income to
the receiving party and/or as tax deductible costs to the
paying party, the amount of the indemnification shall be
adjusted so that (after such adjustment payments have been
made) the result described in the preceding sentence is
achieved on an after-tax basis. Payments made on account
pursuant to Article 7.5.3 shall be repaid simultaneously with,
or set-off against, indemnification payments made pursuant to
this Article 7.5.4 in respect of the same Contingent Tax
Claim.
7.6 The Seller shall own 15% and the Purchaser shall own 85% of all
contingent and/or unknown rights, assets and claims which are neither
Related To the Energy Business nor Related To the Medical Business. The
Purchaser shall bear 85% and the Seller shall bear 15% of all
contingent and/or unknown liabilities and obligations which are neither
Related To the Energy Business nor Related To the Medical Business.
8. THE CLOSING
8.1 The Closing of the transactions contemplated hereby (the "CLOSING")
shall take place as of the Effective Time and substantially
simultaneously with the Closing provided for in Section 2.02 of the
Transaction Agreement at the offices of Wiersholm, Mellbye & Bech, Oslo
in accordance with a closing agenda to be prepared by the parties and
their legal advisers.
8.2 At the Closing the Seller shall take all commercially reasonable steps
to transfer ownership of the Transferred Assets including, without
limitation, delivery of:
a. all transfer documents in respect of all intellectual
property rights, including patents and trademarks;
b. all documents required to transfer or replace the liabilities;
c. all documents required to transfer ownership and registered
title (where appropriate) to the Transferred Assets;
d. such other documents and assurances as may be required to
effectively complete the transactions provided for herein,
including, without limitation, all relevant share
certificates.
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9. CONDITIONS PRECEDENT
9.1 Unless the conditions set out in the Transaction Agreement are
satisfied or waived in writing, neither party shall be obliged to
complete the transactions contemplated hereby.
10. MISCELLANEOUS
10.1 SERVICE REQUIREMENTS
10.1.1 The parties hereby agree that the Seller shall have the right
for a period of three years from the Closing to receive
reasonable support from the Purchaser by way of provision of
services related to information systems and administrative,
accounting, financial and legal services and the use of such
equipment, premises and facilities (or equivalent premises and
facilities) within the Sellers' headquarters building as are
currently being used by the Energy Business or the Retained
Employees.
10.1.2 Each service or right to use equipment, premises or
facilities or resources shall be provided or granted by the
Purchaser pursuant to and on the terms and conditions set out
in separate agreements to be entered into between the parties
from time to time. Such agreements shall provide, without
limitation:
a. in the case of leases of premises owned by the
Purchaser, that the rent to be paid by the Seller
shall initially be equivalent to the relevant amount
allocated for the lease of such premises in the
relevant intra-group accounts for the fiscal year
ending on 31st December, 1995 such rent to be
index-linked; and
b. in the case of all other services, resources,
equipment and/or facilities, that such shall be
provided at fully burdened cost, as calculated by
the Purchaser in accordance with GAAP.
10.2 EMPLOYEES
10.2.1 All employees of the Medical Businesses and the Energy
Business shall continue to be employed in their respective
businesses following completion of the transactions
contemplated herein in accordance with the applicable law.
10.2.2 The parties hereby agree that, within 30 days of the date of
execution of this Agreement, the Seller and IVAX Corporation
shall agree on the allocation of the Corporate Employees
between the Seller and the Purchaser. In the case of
disagreement, the Purchaser shall have the right and
obligation to assume the employment of each of such Corporate
Employees.
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10.3 CHANGE OF NAME
Not later than 60 days after the Closing the Purchaser shall cause each
of the Medical Companies whose name contains the word "Hafslund" to
change its name to a name that does not contain the word "Hafslund" or
any other word similar to the word "Hafslund" and shall promptly cause
such new names to be registered in the Register of Business Enterprises
("FORETAKSREGISTERET"). Not later than 60 days after the Closing,
neither the Seller nor any of its subsidiaries shall to make use of the
word "Nycomed" or any other word similar to "Nycomed".
10.4 NO RECOURSE
The parties hereby agree that nothing herein shall be construed as a
representation or warranty by the Seller in respect of the Transferred
Assets or the Transferred Liabilities. Except to the extent expressly
provided otherwise herein or in the Transaction Agreement and any
amendments thereto, the Purchaser shall have no right of recourse
whatsoever against the Seller nor shall any circumstance entitle the
Purchaser to make any demand on the Seller for cancellation or revision
of this Agreement in whole or in part, for reduction in the Purchase
Price or any form of compensation in respect of the Transferred Assets
or the Transferred Liabilities or any claim in respect thereof or
otherwise; provided that the Purchaser shall be entitled to enforce all
the provisions of this Agreement.
10.5 EXPENSES
All fees and taxes payable to public authorities in connection with the
performance of this Agreement, including without limitation fees and
taxes related to the transfer of title to real estate
("TINGLYSINGSGEBYR" and "DOKUMENTAVGIFT"), motor vehicles
("OMREGISTRERINGSAVGIFT"), patents and trademarks and professional fees
that are specifically related to the preparation, execution or
performance of this Agreement shall, regardless of whether such fees
are incurred by the Seller or the Purchaser, be split between the
Seller and the Purchaser so that the Seller pays 15% and the Purchaser
pays 85% of all such fees and taxes. All other fees and expenses
incurred in connection with the preparation, execution and performance
of this Agreement shall be paid by the party incurring such expenses as
provided in Article 11.05 of the Transaction Agreement.
10.6 FURTHER ASSURANCES; COOPERATION
Each party shall, and shall cause its subsidiaries to, and shall use
its best endeavors to ensure that all contractual third parties shall,
from time to time execute and deliver such other instruments of
transfer and take such further action as may be required to complete
any matter provided for herein.
In the event that any contractual third party refuses to take such
steps as are required to transfer any contractual rights or obligations
to be transferred pursuant hereto, the parties shall enter into
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such arrangements as shall be necessary so that the party to whom the
contractual rights and obligations ought to have been transferred shall
receive the benefits and burdens of such contract.
Both Seller and Purchaser shall cooperate in the preparation of
accounts and other business records to the extent reasonably
practicable. Following the Effective Time, each of Seller and Purchaser
shall grant the other access to its books and records to the extent
reasonably desired for purposes of any tax filings, litigation,
arbitration, financial reporting obligations or similar matters.
10.7 POST CLOSING
The parties hereby agree to provide to each other all reasonable
cooperation following the Closing in connection with all matters
relating to the transactions contemplated hereby including the filing
of tax returns, obtaining refunds of taxes, and dealing with
assessments and reassessments and disputes relating to previously filed
tax returns relating to the Transferred Assets and the Transferred
Liabilities.
10.8 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
Norwegian law. The parties hereto consent to the exclusive jurisdiction
of any applicable court sitting in London, England, for the purpose of
any action, suit or proceeding arising out of or related to this
Agreement and further agree not to commence any such action, suit or
proceeding except in any such court.
10.9 ENGLISH LANGUAGE
The parties hereby confirm that this Agreement and all other documents
relating thereto are to be in English only, however, it is acknowledged
that certain existing documents and new documents related to that part
of the business to be carried out in Norway may be in Norwegian.
IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto as of
the date first above written in two original counterparts, one of each which is
held by each party hereto.
For and on behalf of For and on behalf of
NYCOMED AS HAFSLUND NYCOMED AS
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