AGREEMENT AND PLAN OF REORGANIZATION
This AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement"), dated as of
April 1, 2000, by and among ▇▇▇▇▇▇▇ Purina Company, a Missouri corporation
("▇▇▇▇▇▇▇") and Energizer Holdings, Inc. ("Energizer"), a Missouri corporation
and wholly owned Subsidiary of ▇▇▇▇▇▇▇.
WITNESSETH:
WHEREAS, ▇▇▇▇▇▇▇'▇ businesses principally consist of the manufacture,
distribution and sale of pet products and battery and lighting products both
domestically and internationally; and
WHEREAS, the Board of Directors of ▇▇▇▇▇▇▇ (the "▇▇▇▇▇▇▇ Board") has
determined that it is in the best interests of the ▇▇▇▇▇▇▇ shareholders to
separate ▇▇▇▇▇▇▇'▇ battery and lighting products business from its pet products
business by creating a new independent publicly held battery and lighting
products company, and to distribute the $.01 par value Energizer Stock
("Energizer Stock") to shareholders of its $.10 par value ▇▇▇▇▇▇▇ Purina Common
Stock ("▇▇▇▇▇▇▇ Stock"); and
WHEREAS, in order to effect such separation, the ▇▇▇▇▇▇▇ Board has
determined that it is necessary and advisable to restructure the worldwide
battery and lighting products business and to transfer to Energizer the direct
stock ownership of those Subsidiaries that are engaged in the operation of the
battery and lighting products business, as well as other assets of ▇▇▇▇▇▇▇ used
in the battery and lighting products businesses, as more fully set forth below;
and
WHEREAS, in connection with such consolidation, ▇▇▇▇▇▇▇ caused Eveready
Battery Company, Inc. ("Eveready"), a Delaware corporation and indirectly wholly
owned Subsidiary of ▇▇▇▇▇▇▇, to form Energizer effective September 23, 1999; and
effected the reincorporation of Eveready Battery International, Inc. ("EBII"), a
wholly owned Subsidiary of Eveready, from Delaware to Missouri by causing EBII
to be merged into Energizer, in connection with which Eveready, the sole
shareholder of EBII, surrendered all shares of capital stock in EBII in a
constructive exchange for all of the issued and outstanding shares of capital
stock of Energizer; and
WHEREAS, in order to effect such distribution of the ownership of Energizer
to the holders of ▇▇▇▇▇▇▇ Stock, the ▇▇▇▇▇▇▇ Board has determined that it is
necessary and desirable to distribute all outstanding shares of Energizer Stock
on a pro rata basis to the holders of ▇▇▇▇▇▇▇ Stock, such distribution being
hereinafter referred to as the "Distribution"; and
WHEREAS, the mergers and liquidations of certain affected subsidiaries are
intended to qualify as nontaxable under Sections 368(a)(1)(A) and 332 of the
Internal Revenue Code of 1986, as amended (the "Code"), the transfer of assets
is intended to qualify as nontaxable under Code Section 368(a)(1)(D) and 351,
and the distribution of Energizer Stock is intended to qualify as nontaxable
under Code Section 355; and
WHEREAS, the parties hereto have determined that it is necessary and
desirable to set forth the principal corporate transactions required to effect
the Distribution and to set forth other agreements that will govern certain
other matters prior to and following the Distribution;
NOW THEREFORE, in consideration of the premises and the mutual covenants
herein contained and intending to be legally bound thereby, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
1.01 General. As used in this Agreement, the following terms shall
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have the following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
Action: any action, claim, suit, arbitration, inquiry, proceeding or
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investigation by or before any court, governmental or other regulatory or
administrative agency or commission or any arbitration or other tribunal.
Affiliate: with respect to any specified Person, an "affiliate" as defined
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in Rule 405 promulgated pursuant to the Securities Act; provided, however, that
for purposes of this Agreement (i) Affiliates of Energizer shall not be deemed
to include ▇▇▇▇▇▇▇ or any corporation which will be a Subsidiary or affiliate of
▇▇▇▇▇▇▇ following the Distribution; and (ii) Affiliates of ▇▇▇▇▇▇▇ shall not be
deemed to include Affiliates of Energizer.
Aircraft Agreement: as defined in Section 5.03 of this Agreement.
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Ancillary Agreements: the Tax Sharing Agreement, the Bridging Services
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Agreement, the Intellectual Property Agreement and the Aircraft Agreement.
Asset: any and all assets, rights and properties, tangible or intangible,
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including, but not limited to, the following: (i) cash, notes and trade
receivable accounts (whether current or non-current and including all rights
with respect thereto); (ii) certificates of deposit, bankers' acceptances,
stock, debentures, evidences of indebtedness, certificates of interest or
participation in profit-sharing agreements, collateral-trust certificates,
preorganization certificates, investment contracts, voting-trust certificates;
(iii) trade secrets and confidential information; statutory, common law and
registered trademarks, trade styles, service marks, service names, trade names,
trade dress, copyrights, moral rights, rights of privacy and publicity, Internet
or other electronic communication addresses (e.g., "▇▇▇▇▇▇▇▇▇.▇▇▇" and
1-800-982-ENRS), business addresses of a proprietary nature (e.g., "Ever Ready
House"), designs, inventions, know-how, issued and unissued patents, and other
property commonly considered intellectual property, all rights to recover for
past infringements of each of the foregoing, and the goodwill of the business to
the extent associated with any and all of the foregoing; (iv) rights under
leases, contracts, licenses, permits, and sales and purchase agreements; (v)
real estate and buildings and other improvements thereon and timber and mineral
rights of every kind; (vi) leasehold improvements, fixtures, trade fixtures,
machinery, equipment (including transportation and office equipment), tools,
dies and furniture; (vii) office supplies, production supplies, spare parts,
other miscellaneous supplies and other tangible property of any kind; (viii) raw
materials, work-in-process, finished goods, consigned goods and other
inventories; (ix) prepayments or prepaid expenses; (x) claims, causes of action,
choses in action, rights of recovery and rights of set-off of any kind; (xi) the
right to receive mail and other communications; (xii) lists of advertisers,
records pertaining to advertisers and accounts, lists and records pertaining to
suppliers, customers and agents, and books, ledgers, files and business records
of every kind; (xiii) advertising materials and other recorded, printed or
written materials; (xiv) goodwill as a going concern and other intangible
properties; (xv) personnel records and employee contracts, including any rights
thereunder to restrict an employee from competing in certain respects; and (xvi)
licenses and authorizations issued by any governmental authority.
Battery Business: ▇▇▇▇▇▇▇'▇ direct or indirect ownership of (i) the
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worldwide business of the manufacture, distribution and sale of primary
alkaline, carbon zinc, miniature, rechargeable and other types of batteries; and
flashlights and other lighting products; and (ii) all joint ventures involving
or associated with the businesses described in (i) next above.
Bridging Services Agreement: as defined in Section 5.03 of this Agreement.
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Business: the Battery Business or the ▇▇▇▇▇▇▇ Business.
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Business Day: any day other than a Saturday, a Sunday or a day on which
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banking institutions located in the State of Missouri are obligated by law or
executive order to close.
Cash: cash, checks deposited in lockboxes, marketable securities,
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compensating balances used to secure debt financing, amounts held in margin
accounts, and such other items as have been or would be classified as cash
consistent with accounting policies of ▇▇▇▇▇▇▇.
Code: the Internal Revenue Code of 1986, as amended, or any successor
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legislation.
Current Plan Year: the plan year or fiscal year, to the extent applicable
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with respect to any Plan, during which the Distribution Date occurs.
Distribution: as defined in the recitals to this Agreement.
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Distribution Date: April 1, 2000.
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DuPont Agreement: an Agreement and Plan of Merger and Exchange dated as of
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December 2, 1997, by and among E. I. du Pont de Nemours and Company, ▇▇▇▇▇▇▇ and
certain of their affiliates.
Energizer: as defined in the recitals to this Agreement.
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Energizer Assets: except to the extent provided in, and subject to the
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provisions of, any of the Ancillary Agreements, (i) all of the Assets used or
held by or on behalf of any member of the Energizer Group or the ▇▇▇▇▇▇▇ Group
immediately prior to the Distribution which are used or held for use
exclusively in the Battery Business, and which are not used or held for use in
the ▇▇▇▇▇▇▇ Business; including, but not limited to, the Assets set forth on
Schedule 1.01(a) but excluding the Assets set forth on Schedule 1.01(b); and
(ii) any office equipment and furniture used immediately prior to the
Distribution exclusively by Energizer Employees.
Energizer Board: the Board of Directors of Energizer Holdings, Inc. and
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their duly elected or appointed successors.
Energizer Deferred Compensation Plan: as defined in Section 7.09 of this
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Agreement.
Energizer Employee: any individual who (i) is on the Distribution Date, or
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immediately following the Distribution will be, an employee of any member of the
Energizer Group, (ii) is on the Distribution Date employed by a member of the
▇▇▇▇▇▇▇ Group but who, pending transfer of employment to a member of the
Energizer Group, performs duties primarily for the Energizer Group other than
pursuant to the Bridging Services Agreement; or (iii) is on leave (including,
but not limited to, leave for sickness or disability) or layoff from active
employment on the Distribution Date but who, immediately prior to commencement
of such leave or layoff, was employed in, or performed duties primarily for, the
Battery Business. Notwithstanding the foregoing, an Energizer Employee shall
not include any individual who, as of the Distribution Date, is employed by a
member of the Energizer Group but performs duties primarily for the ▇▇▇▇▇▇▇
Group, pending subsequent transfer of employment to a member of the ▇▇▇▇▇▇▇
Group or termination of employment.
Energizer Group: Energizer and its Affiliates after the Distribution.
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Energizer Individual: any individual who is an Energizer Employee, a
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Former Energizer Employee, or a beneficiary or alternate payee of an Energizer
Employee or of a Former Energizer Employee.
Energizer Obligations: as defined in Article X of this Agreement.
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Energizer Retirement Plan: the Energizer Holdings, Inc. Retirement Plan, a
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defined benefit pension plan.
Energizer Stock: Energizer common stock, par value $.01 per share.
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ERISA: the Employee Retirement Income Security Act of 1974, as amended, or
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any successor legislation.
Exchange Act: the Securities Exchange Act of 1934, as amended, together
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with the rules and regulations promulgated thereunder.
Executive Life Plan: the ▇▇▇▇▇▇▇ Purina Executive Life Plan.
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Executive SIP: the ▇▇▇▇▇▇▇ Purina Executive Savings Investment Plan.
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Form 10: as defined in Section 2.06 of this Agreement.
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Former Battery Businesses: all of the following businesses which, as of
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the Distribution Date, were no longer owned and/or conducted, directly or
indirectly, by ▇▇▇▇▇▇▇, Energizer or their Subsidiaries, Affiliates or any
predecessors to the foregoing:
(i) former businesses and operations relating to the manufacture, sale and
distribution of battery, safety and lighting products conducted by ▇▇▇▇▇▇▇
and/or its Subsidiaries after June 30, 1986, including, but not limited to, the
worldwide rechargeable Original Equipment Manufacturers' battery business and
the Eversafe line of products;
(ii) former businesses and operations relating to the manufacture, sale and
distribution of battery and lighting products conducted by Union Carbide
Corporation and/or its Subsidiaries and Affiliates through June 30, 1986, to the
extent assets and liabilities related to such businesses and operations were
acquired and assumed by ▇▇▇▇▇▇▇ and its Subsidiaries and Affiliates effective
June 30, 1986 pursuant to, or arising out of the transactions contemplated by,
the Omnibus Purchase and Sale Agreement by and between Union Carbide Corporation
and ▇▇▇▇▇▇▇ Purina Company, made April 7, 1986; and
(iii) all former joint ventures involving or associated with the businesses
described in (i) or (ii) above or the Battery Business.
Former Businesses: The Former ▇▇▇▇▇▇▇ Businesses and the Former Battery
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Businesses.
Former Energizer Employee: an individual who was employed in, or performed
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duties primarily for, the Battery Business or a Former Battery Business at the
time of his or her termination or retirement on or prior to the Distribution
Date and who was not subsequently, prior to the Distribution Date, employed in
the ▇▇▇▇▇▇▇ Business or in a Former ▇▇▇▇▇▇▇ Business.
Former ▇▇▇▇▇▇▇ Businesses: all of the businesses and operations directly
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or indirectly owned and conducted by ▇▇▇▇▇▇▇ prior to, but not as of, the
Distribution Date, other than a Former Battery Business; and all former joint
ventures involving or associated with such businesses and operations.
Former ▇▇▇▇▇▇▇ Employee: an individual who was employed in, or performed
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duties primarily for, the ▇▇▇▇▇▇▇ Business or a Former ▇▇▇▇▇▇▇ Business at the
time of his or her termination or retirement and who was not subsequently, prior
to the Distribution Date, employed in the Battery Business or a Former Battery
Business.
Group: the ▇▇▇▇▇▇▇ Group or the Energizer Group.
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Indebtedness of the Energizer Group: external obligations of a member or
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members of the Energizer Group in the form of money that is borrowed from third
party banks and/or financial institutions, to the extent that such indebtedness
(i) is incurred in connection with, or arising out of the operations of, the
Battery Business or is assigned to Energizer or a member of its Group as set
forth in Section 2.01(j)(iii); and (ii) is or should be reflected and booked on
the balance sheet statements of the Battery Business in accordance with
accounting policies of ▇▇▇▇▇▇▇; and in no event shall intercompany or
intracompany accounts between the Battery Business and the ▇▇▇▇▇▇▇ Business be
deemed to be Indebtedness of the Energizer Group.
Indemnifiable Loss: with respect to any claim by an Indemnitee for
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indemnification hereunder, any and all losses, liabilities, claims, damages,
obligations, payments, costs and expenses (including, without limitation, the
costs and expenses of any and all Actions, demands, claims and assessments, and
any and all judgments, settlements and compromises related thereto and
reasonable attorney's fees and expenses in connection therewith) incurred or
suffered by such Indemnitee with respect to such claim except as may arise in
connection with the performance of any of the Ancillary Agreements, which shall,
in each such case, be governed by the terms of such Ancillary Agreement.
Indemnitee: as defined in Section 4.02 of this Agreement.
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Indemnitor: as defined in Section 4.02 of this Agreement.
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Information: as defined in Section 6.02 of this Agreement.
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Information Statement: the information statement sent to holders of
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▇▇▇▇▇▇▇ Stock in connection with the Distribution, which sets forth appropriate
disclosures concerning the Battery Business, Energizer, the Distribution and
other related matters.
IP Agreement: as defined in Section 5.03 of this Agreement.
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IRS: the Internal Revenue Service.
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ISP: the ▇▇▇▇▇▇▇ Purina 1988, 1996 and 1999 Incentive Stock Plans.
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Liabilities: all claims, debts, liabilities, royalties, license fees,
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losses, costs, expenses, deficiencies, litigation proceedings, taxes, levies,
imposts, duties, deficiencies, assessments, attorneys' fees, charges,
allegations, demands, damages, judgments, guaranties, indemnities, or
obligations, whether absolute or contingent, matured or unmatured, liquidated or
unliquidated, accrued or unaccrued, known or unknown and whether or not the same
would properly be reflected on a balance sheet, including all costs and expenses
relating thereto.
Notice of Claim: as defined in Section 4.02 of this Agreement.
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NYSE: the New York Stock Exchange.
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Operating Agreement: an agreement as described in Section 2.04(f) in
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effect during a period of beneficial ownership of the Energizer Assets or the
▇▇▇▇▇▇▇ Assets.
Person: an individual, a partnership, a joint venture, a corporation, a
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trust or other entity, an unincorporated organization or a government or any
department or agency thereof.
Plan: any plan, policy, arrangement, contract or agreement providing
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benefits (including salary, bonuses, deferred compensation, incentive
compensation, savings, stock purchases, pensions, profit sharing, welfare
benefits or retirement or other retiree benefits, including retiree medical
benefits) for any group of employees or former employees or individual employee
or former employee, or the beneficiary or beneficiaries of any such employee or
former employee, whether formal or informal or written or unwritten and whether
or not legally binding, and including any means, whether or not legally
required, pursuant to which any benefit is provided by an employer to any
employee or former employee or the beneficiary or beneficiaries of any such
employee or former employee.
Qualified Plan: a Plan which is an employee pension benefit plan (within
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the meaning of Section 3(2) of ERISA) and which constitutes or is intended in
good faith to constitute a Qualified Plan under Section 401(a) of the Code.
▇▇▇▇▇▇▇: as defined in the recitals to this Agreement.
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▇▇▇▇▇▇▇ Assets: except to the extent provided in, and subject to the
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provisions of, any of the Ancillary Agreements, all of the Assets, other than
the Energizer Assets, used or held immediately prior to the Distribution Date by
or on behalf of any member of either Group, including, but not limited to, the
Assets set forth on Schedule 1.01(c).
▇▇▇▇▇▇▇ Board: the Board of Directors of ▇▇▇▇▇▇▇ Purina Company and their
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duly elected or appointed successors.
▇▇▇▇▇▇▇ Business: all of the businesses owned, directly or indirectly, by
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▇▇▇▇▇▇▇ immediately prior to the Distribution Date, other than the Battery
Business.
▇▇▇▇▇▇▇ Chilean Asset Purchase Price: Cash paid, after the Distribution,
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to Energizer or its Affiliates by ▇▇▇▇▇▇▇ or its Affiliates to effect the
purchase, as set forth in Section 2.01(e), of the Assets and Liabilities of the
▇▇▇▇▇▇▇ Business conducted by Eveready de Chile ▇.▇.
▇▇▇▇▇▇▇ Deferred Compensation Plan: the ▇▇▇▇▇▇▇ Purina Deferred
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Compensation Plan for Key Employees.
▇▇▇▇▇▇▇ Employee: any individual who, as of the day prior to the
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Distribution Date, is an employee of any member of either Group, other than an
Energizer Employee.
▇▇▇▇▇▇▇ Group: ▇▇▇▇▇▇▇ and its Affiliates after the Distribution.
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▇▇▇▇▇▇▇ Individual: any individual who is a ▇▇▇▇▇▇▇ Employee, a Former
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▇▇▇▇▇▇▇ Employee, or a beneficiary or alternate payee of a ▇▇▇▇▇▇▇ Employee or
of a Former ▇▇▇▇▇▇▇ Employee.
▇▇▇▇▇▇▇ Option: the option defined in Section 7.08(b) of this Agreement.
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▇▇▇▇▇▇▇ Retirement Plan: the ▇▇▇▇▇▇▇ Purina Retirement Plan, a defined
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benefit pension plan.
▇▇▇▇▇▇▇ Stock: ▇▇▇▇▇▇▇ Purina Company common stock, $.10 par value.
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Record Date: March 31, 2000, determined by the Board of Directors of
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▇▇▇▇▇▇▇ as the record date for determining shareholders of ▇▇▇▇▇▇▇ Stock
entitled to receive the Distribution.
Rights: the rights to be issued by Energizer pursuant to the Rights
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Agreement between Energizer and Continental Stock Transfer and Trust Company.
SEC: the Securities and Exchange Commission.
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Securities Act: the Securities Act of 1933, as amended, together with the
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rules and regulations promulgated thereunder.
Shared Liability: a Liability arising out of, or associated with, the
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ownership of both the Energizer Assets and the ▇▇▇▇▇▇▇ Assets; or the operation
of the Battery Business or a Former Battery Business, on the one hand, and the
▇▇▇▇▇▇▇ Business or a Former ▇▇▇▇▇▇▇ Business, on the other hand, prior to the
Distribution.
SIP: a Savings Investment Plan.
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Subsidiary: with respect to any specified Person, any corporation or other
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legal entity of which such Person or any of its Subsidiaries controls or owns,
directly or indirectly, 50% or more of the stock or other equity interest
entitled to vote on the election of members to the board of directors or similar
governing body of such corporation or other legal entity.
Survivor Life Insurance Plan: the 1996 Split Dollar Second-To-Die Plan.
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Tax Sharing Agreement: as defined in Section 5.03 of this Agreement.
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Third-Party Claim: any Action or claim by a third party against or
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otherwise involving an Indemnitee for which indemnification may be sought
pursuant to Article IV hereof.
Welfare Plan: any Plan which is not a Qualified Plan and which provides
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medical, health, disability, accident, life insurance, death, dental or other
welfare benefits, including any post-employment benefits or retiree medical
benefits.
1.02 References to Time. All references to times of the day in this
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Agreement shall refer to St. Louis, Missouri time unless otherwise specifically
indicated.
ARTICLE II
CERTAIN RESTRUCTURING TRANSACTIONS
2.01 Restructuring Transactions. Prior to the Distribution Date or, as
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indicated, as soon as practicable thereafter, the following shall have been or
shall be effected:
(a) Reincorporation Merger. Eveready, the sole shareholder of
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Energizer and EBII, shall surrender all of the issued and outstanding shares of
capital stock of EBII in a constructive exchange for all of the issued and
outstanding shares of capital stock of Energizer, pursuant to the General and
Business Corporation Law of Missouri and Delaware General Corporation Law, in
connection with EBII's reincorporation from Delaware to Missouri and merger into
Energizer.
(b) United Kingdom Restructuring. Energizer UK Company ("Energizer
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UK"), a United Kingdom unlimited company, shall wholly redeem EII's partnership
interest in Energizer UK (the "Partnership Interest") by distributing to EII (i)
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all of the stock of Energizer Holdings UK Company ("Energizer Holdings UK"), a
United Kingdom unlimited company, which owns all of the stock of the following
subsidiaries: (a) Energizer Limited, (b) Ever Ready Ltd; (c) ▇▇▇▇▇▇▇ Energy
Systems U.K. Ltd.; (d) BCL (MVL) Limited; (e) Berec Overseas Investments Ltd.,
(f) Energizer Ireland Ltd., (g) WER (MVL) (1998) Ltd., and (h) ▇▇▇▇▇▇▇ Trust
Limited, and; (ii) cash proceeds resulting from (a) a loan to Energizer UK by
Tower Holding Company, Inc. ("Tower Holding"), a Delaware corporation, and (b) a
contribution of capital by ▇▇▇▇▇▇▇, such that the fair market value of (i) and
(ii) will equal the fair market value of the Partnership Interest. The value of
the Partnership Interest and the value of Energizer Holdings UK shall be
determined by an independent appraisal.
(c) Mexican Restructuring. ▇▇▇▇▇▇▇ Purina Holdings Mexico S.A. de C.V.
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("RP Holdings Mexico"), a Mexican corporation, shall capitalize a portion of the
intercompany debt owed to it by its wholly owned Subsidiary, Eveready de Mexico
S.A. de C.V. ("Eveready Mexico"), such that the resulting value of Eveready de
Mexico will equal EII's interest in RPHM. Eveready de Mexico shall borrow from
outside parties an amount necessary to pay off its remaining intercompany debt
to RPHM prior to the Distribution. Prior to the Distribution Date, or as soon
as practicable thereafter, RP Holdings Mexico shall distribute all of the
capital stock of Eveready Mexico to EII in complete redemption of EII's entire
stock interest in RP Holdings Mexico.
(d) Brazilian Restructuring. EII shall form a new, wholly owned
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Subsidiary, Energizer do Brasil, Ltda.("Energizer do Brasil"), a Brazilian
corporation. ▇▇▇▇▇▇▇ Purina do Brasil Ltda.("RP do Brasil"), a Brazilian
corporation, shall sell to Energizer do Brasil all of the Assets and Liabilities
associated with its ownership and operation of the Battery Business in Brazil,
other than external debt, all of which RP do Brasil shall retain. The
purchase price shall be equal to the statutory net book value of such Business
as of March 31, 2000, excluding such external debt. Prior to the Distribution
Date, EII shall distribute to ▇▇▇▇▇▇▇ in the form of a dividend all of its stock
interest in RP do Brasil. Prior to the Distribution, EII will also assign to
Checkerboard Holding Company ("Checkerboard Holding"), a Delaware corporation,
an intercompany note evidencing debt owed from RP do Brasil to EII.
(e) Argentinean/Chilean Restructuring. Prior to the Distribution Date
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or as soon as practicable thereafter, Checkerboard Holding shall form a new
wholly owned Subsidiary, ▇▇▇▇▇▇▇ Purina Chile, S.A. ("RP Chile"), a Chilean
corporation. Eveready de Chile S.A. ("Eveready Chile"), a Chilean corporation,
will sell the Assets and Liabilities of the ▇▇▇▇▇▇▇ Business conducted by it to
RP Chile. The purchase price shall be determined by an independent appraisal
less debt. Prior to the Distribution Date, EII will transfer to Checkerboard
Holding, and Eveready Battery Company will transfer to Tower Holding, that
portion of the stock of ▇▇▇▇▇▇▇ Purina Argentina S.A. ("RP Argentina"), an
Argentinean corporation, held by each transferor company reflecting the relative
value of their respective interests in the ▇▇▇▇▇▇▇ Business conducted by RP
Argentina. Prior to the Distribution Date or as soon as practicable thereafter,
in accordance with Argentinean law, RP Argentina will divide into two
Argentinean corporations, one conducting the Battery Business and the other
conducting the ▇▇▇▇▇▇▇ Business, as follows: (i) RP Argentina will transfer all
of its stock interest in Eveready Chile, and the Assets and Liabilities of the
Battery Business conducted by RP Argentina to Energizer Argentina, a newly
created Argentinean corporation resulting from the division of RP Argentina,
having the same shareholders, with identical share ownership proportions, as RP
Argentina; and (ii) Checkerboard Holding and Tower Holding will then each
exchange their shares of Energizer Argentina for the shares of RP Argentina
held, respectively, by EII and Eveready. EII and Eveready will then be sole
shareholders of Energizer Argentina, which will conduct the Battery Business in
Argentina and will be the parent company of Eveready Chile; and Checkerboard
Holding and Tower Holding will then be sole shareholders of RP Argentina, which
will conduct the ▇▇▇▇▇▇▇ Business in Argentina.
(f) Spanish Restructuring. ▇▇▇▇▇▇▇ Energy Systems Iberica S.A.
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("RESIB"), a Spanish corporation, which indirectly conducts the Battery Business
in Spain through its 91% owned Subsidiary Energizer Iberia S.A., also a Spanish
corporation, will sell all of the issued and outstanding stock of its wholly
owned Subsidiary ▇▇▇▇▇▇▇ Purina Europe S.A ("RPE"), which directly conducts the
▇▇▇▇▇▇▇ Business, to Checkerboard Holding for an amount determined by an
independent appraisal.
(g) Distribution of Energizer Stock to VCS Holding. Following (i) the
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transaction described in paragraph 2.01(a), and (ii) those of the transactions
described in paragraphs 2.01(b) through (f) which have been completed prior to
the Distribution Date, Eveready will distribute by dividend all the stock of
Energizer to VCS Holding Company ("VCS"), a Delaware corporation and wholly
owned Subsidiary of ▇▇▇▇▇▇▇.
(h) Merger of VCS Holding into ▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇ and VCS shall enter
--------------------------------------
into an Agreement and Plan of Merger and Complete Liquidation pursuant to which
VCS shall be merged with and into ▇▇▇▇▇▇▇ pursuant to the General and Business
Corporation Law of Missouri and Delaware General Corporation Law, and in
accordance with the terms and conditions of such merger agreement. Prior to
such merger, VCS shall transfer to Tower Holding, as a contribution to capital,
all shares of capital stock of Interstate Bakeries Corporation held by VCS as
well as all receivables reflecting intercompany loans by VCS to ▇▇▇▇▇▇▇.
Following the merger, VCS will cease to exist, and ▇▇▇▇▇▇▇ shall become the
direct owner of Energizer and all other stock interests and Assets owned by VCS
at the time of the merger, including, but not limited to, notes reflecting
intercompany loans by VCS to Eveready ("the Eveready Notes"). The intercompany
account owed by ▇▇▇▇▇▇▇ to VCS shall be extinguished incident to the merger of
VCS into ▇▇▇▇▇▇▇.
(i) Canadian Restructuring. ▇▇▇▇▇▇▇ shall contribute a portion of its
-----------------------
capital stock in ▇▇▇▇▇▇▇ Purina Canada Inc. ("RP Canada") to Energizer so that
the number of shares of RP Canada stock owned by Energizer, when combined with
the number of shares of RP Canada stock owned by EII, will reflect, on a
combined stock ownership basis, an interest in RP Canada equal to the appraised
value of the Battery Business conducted by RP Canada. EII and Energizer will
form a new Canadian corporation, Energizer Canada Inc., and will each transfer
all of their stock in RP Canada to Energizer Canada Inc. in exchange for
Energizer Canada Inc. common stock of proportionate value. RP Canada will
transfer the Assets and Liabilities of the Battery Business conducted by it to
Energizer Canada Inc. in exchange for all of the issued and outstanding
preferred stock in Energizer Canada Inc. RP Canada will then issue a note to
Energizer Canada Inc. in complete redemption of the RP Canada common stock held
by Energizer Canada Inc., and Energizer Canada Inc. will issue to RP Canada a
note of equal value in redemption of the Energizer Canada Inc. preferred stock
held by RP Canada. The two notes will then be offset against one another and
each cancelled. ▇▇▇▇▇▇▇ will thereupon own all of the stock of RP Canada, which
will conduct only the ▇▇▇▇▇▇▇ Business, and EII and Energizer will in the
aggregate own all of the stock of Energizer Canada Inc., which will conduct only
the Battery Business.
(j) Other Post-Merger Transfers/Debt Assumption. Following the merger
--------------------------------------------
described in Section 2.01(h) and the restructuring described in Section 2.01(i),
the following transactions will take place prior to the Distribution Date:
(i) ▇▇▇▇▇▇▇ will transfer the Eveready Notes to MKTE, Inc., a newly
formed Delaware corporation and first tier Subsidiary of ▇▇▇▇▇▇▇.
(ii) ▇▇▇▇▇▇▇ will transfer to Energizer all of the stock of Eveready;
will cause the transfer to Eveready of all of the stock of EII and MKTE; and
will cause the transfer to EII of all of the stock of Energizer Japan,
Inc., a Delaware corporation.
(iii) ▇▇▇▇▇▇▇ will enter into certain credit facility agreements to
borrow funds from third party banks and/or financial institutions and will
assign to Energizer all obligations, including, but not limited to, the
obligation to make payments of principal and interest to the lenders
arising out of or in connection with such credit facility agreements, other
than for certain fees set forth in Section 12.04. The sum of such debt
assumed by Energizer, plus other Indebtedness of the Energizer Group, is
intended to equal total Indebtedness of the Energizer Group, net of Cash, of
US$586.8 million as of the close of business on March 31, 2000.
2.02 Issuance of Stock. Prior to the Distribution Date, the parties
-------------------
hereto shall take all steps necessary so that immediately prior to the
Distribution Date, the number of shares of Energizer Stock outstanding and held
by ▇▇▇▇▇▇▇ shall equal the number of shares necessary to effect the
Distribution. The Distribution shall be effected by distributing, on a pro rata
basis to every holder of ▇▇▇▇▇▇▇ Stock, one share of Energizer Stock for every
three shares of ▇▇▇▇▇▇▇ Stock held as of the Record Date.
2.03 Share Purchase Rights Agreement; Articles of Incorporation;
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Bylaws. Prior to the Distribution Date, Energizer shall adopt an Energizer
Rights Agreement in substantially the form filed with the SEC as an exhibit to
the Form 10, and the Board of Directors of Energizer shall authorize a
distribution of one Right to every share of outstanding Energizer Stock, such
distribution to occur prior to the Distribution. ▇▇▇▇▇▇▇ and Energizer shall
take all action necessary so that, at the Distribution Date, the Articles of
Incorporation and Bylaws of Energizer shall be substantially in the forms filed
with the SEC as exhibits to the Form 10.
2.04 Transfer of Assets; Assumption of Liabilities.
--------------------------------------------------
(a) Prior to the Distribution Date, the parties hereto shall cooperate in
taking all action necessary to convey, assign and transfer to Energizer or its
Affiliates, effective no later than the Distribution Date, all of the right,
title and interest in the Energizer Assets held by any member of the ▇▇▇▇▇▇▇
Group, and to convey, assign and transfer to ▇▇▇▇▇▇▇ or its Affiliates all of
the right, title and interest in the ▇▇▇▇▇▇▇ Assets held by any member of the
Energizer Group. Effective as of the Distribution Date, Energizer and its
Affiliates shall become the beneficial owners of all of the Energizer Assets,
and ▇▇▇▇▇▇▇ and its Affiliates shall remain the beneficial owners of all of the
▇▇▇▇▇▇▇ Assets. The parties acknowledge that formal actions to effect fully the
legal transfers of such Assets may not be completed by the Distribution Date,
but that the entire beneficial title and interest in and to each Asset shall
pass to Energizer or remain with ▇▇▇▇▇▇▇, as the case may be, as of the
Distribution Date. The parties shall take such action as is necessary in their
reasonable discretion, whether before or after the Distribution Date, to
complete the transfer of the Energizer Assets to the Energizer Group and the
▇▇▇▇▇▇▇ Assets to the ▇▇▇▇▇▇▇ Group, as the case may be, and each party shall
cooperate fully with the other in such regard.
▇▇▇▇▇▇▇ and Energizer shall cooperate in estimating the appropriate amount of
Cash to be transferred to or from members of the Energizer Group on or before
March 31, 2000 to cause the Energizer Group to hold, as of the close of business
on March 31, 2000, Cash in such an amount that would cause the Indebtedness of
the Energizer Group, at the close of business on such date, to equal US$586.8
million, net of such Cash. The parties shall use reasonable efforts to cause
the transfer of Cash to or from Energizer to effect this provision.
(b) As of the Distribution Date, Energizer and ▇▇▇▇▇▇▇ and, as
appropriate, other members of their respective Groups, shall assume or retain
all of the Liabilities, with respect to Energizer, of the Battery Business and
Former Battery Businesses and, with respect to ▇▇▇▇▇▇▇, of the ▇▇▇▇▇▇▇ Business
and Former ▇▇▇▇▇▇▇ Businesses, of whatsoever type or nature, arising exclusively
out of or associated exclusively with the ownership of the Assets of such
Businesses or Former Businesses or the operation of such Businesses or Former
Businesses prior to the Distribution, whether such Liabilities become known
prior to or after, or are asserted prior to or after, the Distribution. Unless
otherwise provided in this Agreement or any Schedule hereto, Energizer and its
Affiliates and ▇▇▇▇▇▇▇ and its Affiliates shall assume (or retain, as the case
may be) a share of any Shared Liability in proportion, as applicable, to their
respective ownership of the relevant Assets, control of affected operations or
employment of affected individuals. Shared Liabilities shall include, but not
be limited to, those set forth on Schedule 2.04(b)(1). Notwithstanding the
foregoing, effective as of the Distribution Date, Energizer or another member of
the Energizer Group shall assume or retain Liabilities specifically described in
any other provision of this Agreement or any Ancillary Agreement, and
Liabilities described on Schedule 2.04(b)(2) to this Agreement. ▇▇▇▇▇▇▇ and
members of the ▇▇▇▇▇▇▇ Group shall, except as qualified hereinabove, assume or
retain the Liabilities specifically described in this Agreement or any Ancillary
Agreement, and the Liabilities specifically described on Schedule 2.04(b)(3) to
this Agreement.
(c) The parties agree and acknowledge that the assumption or retention by
Energizer or other members of the Energizer Group or ▇▇▇▇▇▇▇ or other members of
the ▇▇▇▇▇▇▇ Group, as the case may be, of all such Liabilities described herein
is part of a single plan to transfer the Battery Business and the Energizer
Assets to Energizer as of the Distribution Date. With regard to that plan, the
parties further agree that (i) the entire beneficial title and interest in and
to each and all of the Energizer Assets shall, regardless of when legal title to
any such asset is in fact transferred to Energizer or its Subsidiaries, remain
in ▇▇▇▇▇▇▇ until the Distribution Date at which time all beneficial title and
interest in all of the Energizer Assets will pass to Energizer, and all title
and interest in and to each and all of the ▇▇▇▇▇▇▇ Assets which is owned by a
member of the Energizer Group prior to the Distribution Date shall, regardless
of when legal title to any such asset is in fact transferred to ▇▇▇▇▇▇▇ or its
Subsidiaries after the Distribution Date, be beneficially owned by ▇▇▇▇▇▇▇; (ii)
the economic burden of the assumption or retention by the members of the
Energizer Group or the ▇▇▇▇▇▇▇ Group, as the case may be, of each and all of the
Liabilities described herein shall pass to the Energizer Group or the ▇▇▇▇▇▇▇
Group, as the case may be, as of the Distribution Date, regardless of when
Energizer or any other member of the Energizer Group or ▇▇▇▇▇▇▇ or any other
member of the ▇▇▇▇▇▇▇ Group, as the case may be, in fact assumes or becomes
legally obligated to the obligee of any one or more of such Liabilities; and
(iii) all operations of the Battery Business shall be for the account of ▇▇▇▇▇▇▇
through 12:01 a.m. on the Distribution Date and shall be for the account of
Energizer thereafter.
(d) ▇▇▇▇▇▇▇ and Energizer shall, and shall cause their Affiliates to,
execute prior to, or as soon as practicable following, the Distribution Date,
such additional agreements and arrangements as may be necessary or appropriate
(i) to effect the restructuring transactions set forth in Section 2.01; (ii) to
transfer to the appropriate member of the Energizer Group or ▇▇▇▇▇▇▇ Group such
local product registrations, franchises, licenses, and any other governmental
authorizations or other rights owned or held by ▇▇▇▇▇▇▇, Energizer or their
respective Groups that are necessary to the conduct of their Businesses in such
jurisdiction; (iii) to make all such further assignments and do all such other
acts as are necessary or desirable to carry out the intent of the parties that
each of the Businesses, as a going concern, be fully vested in the appropriate
party as of the Distribution Date and operated for its benefit and burden as of
12:01 a.m. on the Distribution Date; and (iv) to provide for, and negotiate in
good faith, such other agreements and arrangements relating to the foregoing as
the parties deem appropriate, including, but not limited to, any such agreements
or arrangements relating to the treatment of employees, benefit plans,
intellectual property and taxes.
(e) If any Energizer Asset or ▇▇▇▇▇▇▇ Asset is not owned, respectively,
by a member of the Energizer Group or ▇▇▇▇▇▇▇ Group or leased from a third party
or governmental entity by a member of the appropriate Group, as of the
Distribution Date, ▇▇▇▇▇▇▇ and Energizer shall use their reasonable best efforts
to transfer, assign and deliver such assets or leases to the appropriate member
of the other Group as soon as practicable thereafter.
Prior to such transfer or assignment, ▇▇▇▇▇▇▇ or Energizer, as the case may be,
shall use its reasonable best efforts to give the benefits of ownership of such
Assets to the appropriate member of the other Group. The entire economic
beneficial interest in and to, and the risk of loss with respect to, such Assets
shall, regardless of when legal title thereto shall be transferred to the
appropriate member of the Energizer or ▇▇▇▇▇▇▇ Group, pass to those entities as
of the Distribution. ▇▇▇▇▇▇▇ and Energizer shall, or shall cause their
Affiliates to, hold such Assets for the benefit and risk of the other and shall
cooperate with the other in any lawful and reasonable arrangements designed to
provide the benefits of ownership of the Assets to it, including, but not
limited to, properly recording evidence of such beneficial ownership and risk of
loss with appropriate governmental entities as required by applicable law.
In the event that the legal interest in such Assets or any claim, right or
benefit arising thereunder or resulting therefrom, is not capable of being sold,
assigned, transferred or conveyed hereunder as a result of the failure to
receive any consents or approvals required for such transfer, then the legal
interest in such Assets shall not be sold, assigned, transferred or conveyed
unless and until approval, consent or waiver thereof is obtained. ▇▇▇▇▇▇▇ and
Energizer shall, or shall cause their Affiliates, at their expense, to use
reasonable best efforts to cooperate in obtaining such consents or approvals as
may be necessary to complete such transfers and to obtain satisfaction of
conditions to transfer as soon as practicable.
Nothing in this Agreement shall be construed as an attempt to assign to a member
of the Energizer Group or the ▇▇▇▇▇▇▇ Group any legal interest in such Assets
which, as a matter of law or by the terms of any legally binding contract,
engagement or commitment to which the legal owner is subject, is not assignable
without the consent of any other Person, unless such consent shall have been
given.
(f) After the Distribution Date, ▇▇▇▇▇▇▇ and Energizer shall cause such
Assets (including the capital stock of any Affiliates) which are beneficially
owned by the other party to be managed at the direction of the beneficial owner
pursuant to one or more Operating Agreements until such Assets are actually
legally transferred and conveyed. Without limiting the foregoing, all revenues,
earnings and cash flows associated with the Assets following the Distribution
Date shall be for the account of the beneficial owner but shall be retained by
the respective legal owner until the transfers are legally effected. Following
the Distribution Date, neither ▇▇▇▇▇▇▇ nor Energizer shall be required to lend,
advance, contribute or use any of its own funds in connection with the
operations of such Assets except to the extent contemplated by the Operating
Agreements.
(g) ▇▇▇▇▇▇▇ and Energizer shall cooperate after the Distribution Date
in determining the actual Indebtedness of the Energizer Group and Cash held by
members of the Energizer Group as of the close of business on March 31, 2000 in
order to determine if a further transfer of Cash is required between the
parties. A preliminary determination of the actual Cash and Indebtedness of the
Energizer Group shall be made no later than 60 days after the Distribution Date
in order to make a preliminary adjustment of Cash from ▇▇▇▇▇▇▇ to Energizer or
vice versa, as the findings warrant.
In addition, the parties shall determine the value of checks and other forms of
electronic payments, written or authorized by Energizer or its Affiliates on
their U.S. bank accounts, which are outstanding and have not cleared as of March
31, 2000. If the aggregate value of such outstanding checks and payments was
less than $10 million, then the target Indebtedness of Energizer, net of Cash,
shall remain $586.8 million. If the aggregate value of such checks and payments
was greater than $10 million, then the target Indebtedness of Energizer, net of
Cash, shall be reduced dollar for dollar by an amount equal to the value of such
outstanding checks in excess of $10 million. For purposes of this Section
2.04(g), checks outstanding shall not be deemed to include checks issued in
connection with obligations under any Plans with respect to Energizer
Individuals.
If it is determined that actual Indebtedness of the Energizer Group, net of
Cash, exceeded US$586.8 million (adjusted, if applicable, pursuant to the
preceding paragraph) as of the close of business on ▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇
shall pay an amount equal to such excess to Energizer in US dollars.
Conversely, if it is determined that actual Indebtedness of the Energizer Group,
net of Cash, fell short of US$586.8 million (adjusted, if applicable, pursuant
to the preceding paragraph) as of the close of business on March 31, 2000,
Energizer shall pay an amount equal to such shortfall to ▇▇▇▇▇▇▇ in US dollars.
Alternatively, the parties may, by mutual consent, cause such amounts to be paid
by any member of one Group to any member of the other Group in local currency.
Any Cash paid to ▇▇▇▇▇▇▇ by Energizer pursuant to this Section 2.04(g) shall be
used to repay third party indebtedness of ▇▇▇▇▇▇▇.
▇▇▇▇▇▇▇ shall have the opportunity to review, to its satisfaction, the books and
records of Energizer and its Affiliates, bank records, loan documentation and
other relevant materials in order to enable ▇▇▇▇▇▇▇ to verify any amounts to be
transferred, and Energizer shall cooperate in ▇▇▇▇▇▇▇'▇ review. Payment of such
preliminary adjustment shall be made within fifteen (15) Business Days of such
determination. In addition, such amounts shall be increased by an amount equal
to simple interest accrued on such unpaid excess (or shortfall, as applicable)
at the rate of 7% per annum for the period from the Distribution Date until the
date such preliminary adjustment is paid to the party to which it is owed.
As soon as practicable after the end of its third fiscal quarter, but no later
than August 10, 2000, Energizer will present to ▇▇▇▇▇▇▇ a draft of its Quarterly
Report on Form 10Q for such quarter, indicating an opening shareholders' equity
balance for Energizer as of April 1, 2000, which balance shall reflect all asset
and liability transfers pursuant to the terms of this Agreement, including, but
not limited to, any Cash to be transferred between the parties under the
provisions of this Section 2.04(g), other than Cash which may be required to be
transferred pursuant to the following paragraph. ▇▇▇▇▇▇▇ shall have the
opportunity to review the books and records of Energizer and its Affiliates in
order to enable it to verify said shareholders' equity balance, and Energizer
shall cooperate in ▇▇▇▇▇▇▇'▇ review. As part of such review, ▇▇▇▇▇▇▇ shall
verify the calculations of the Indebtedness of the Energizer Group and Cash held
by Energizer and its Affiliates as of March 31, 2000, and shall make, if
necessary, a final adjustment to the amounts to be transferred as described
above. Such final adjustments shall be increased by an amount equal to simple
interest accrued on such adjustments at 7% per annum for the period from the
date of any preliminary adjustment as described above, until the date such final
adjustment is paid to the party to which it is owed. If such final adjustments
are made, the opening shareholders' equity balance for Energizer as of April 1,
2000, as described above, shall be revised to reflect such adjustments.
In the event that the opening shareholders' equity balance of Energizer as
of April 1, 2000, revised in the manner described above, is less than US$625
million, then ▇▇▇▇▇▇▇ shall pay to Energizer, no later than August 14, 2000, an
amount of Cash so as to cause the opening shareholders' equity balance to equal
US$625 million following such payment. If such additional payment is required,
the amount paid shall be increased by an amount equal to simple interest accrued
on such amount at the rate of 7% per annum for the period from the Distribution
Date until the date of payment. Energizer shall revise its Quarterly Report on
Form 10Q to reflect such revised opening shareholders' equity balance.
(h) ▇▇▇▇▇▇▇ shall pay to Energizer in US dollars, at the time of
payment of the ▇▇▇▇▇▇▇ Chilean Asset Purchase Price to a member of the Energizer
Group, an additional lump sum equal to interest on such purchase price,
denominated in US dollars at the time of payment to Energizer, accrued at the
simple interest rate of 7% per annum, for the period beginning on the
Distribution Date to the date such purchase price is paid to the Energizer
Affiliate.
(i) Calculations of equivalent values of US and foreign currencies
shall, for purposes of this Agreement, be based on foreign exchange rates for
the relevant date or dates as reflected in accordance with accounting practices
historically employed by ▇▇▇▇▇▇▇.
2.05 Conduct of Business Pending the Distribution Date. Prior to the
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Distribution Date, the Battery Business shall be operated for the sole benefit
of ▇▇▇▇▇▇▇.
2.06 Registration and Listing. Prior to the Distribution Date:
--------------------------
(a) ▇▇▇▇▇▇▇ and Energizer shall prepare, and Energizer shall file with the
SEC, a Registration Statement on Form 10 pursuant to Section 12(b) of the
Exchange Act with respect to the Energizer Stock and associated Rights. ▇▇▇▇▇▇▇
and Energizer shall use reasonable efforts to cause the Form 10 to become
effective under the Exchange Act, and, following such effectiveness, ▇▇▇▇▇▇▇
shall mail the Information Statement to the holders of record of ▇▇▇▇▇▇▇ Stock
as of the close of business on the Record Date.
(b) The parties hereto shall take all such actions as may be necessary or
appropriate under state securities and Blue Sky laws in connection with the
Distribution.
(c) ▇▇▇▇▇▇▇ and Energizer shall prepare, and Energizer shall file and seek
to make effective, an application for the listing of the Energizer Stock and
associated Rights on the NYSE.
2.07 ▇▇▇▇▇▇▇ Purina Charitable Fund.
---------------------------------
(a) Energizer shall take, or cause to be taken, all necessary and
appropriate actions to establish, effective as of (or as soon as practicable
following) the Distribution Date, a charitable trust or a nonprofit corporation
which is exempt from Federal income taxation under Code Section 501(c)(3) (the
"Energizer Charitable Foundation"). ▇▇▇▇▇▇▇ shall, as soon as practicable
following the Distribution Date, in accordance with subparagraph (b) below,
cause the Trustee of the ▇▇▇▇▇▇▇ Purina Charitable Fund, a trust fund exempt
under Code Section 501(c)(3), to transfer to the Energizer Charitable
Foundation, an amount in cash and other liquid investment assets held in the
▇▇▇▇▇▇▇ Purina Charitable Fund with an aggregate value equal to one-third (1/3)
of the fair market value of the assets of the ▇▇▇▇▇▇▇ Purina Charitable Fund as
of the Distribution Date, as determined by the Trustee of the ▇▇▇▇▇▇▇ Purina
Charitable Fund (the "Charitable Transfer Amount"). The date of such transfer
shall be the "Charitable Transfer Date." The Charitable Transfer Amount shall
include earnings (taking into account any appreciation or depreciation of the
assets) for the period from the Distribution Date to the Charitable Transfer
Date (the "Earnings Period"), net of a proportionate share of related investment
fees, expenses and any taxes incurred by the ▇▇▇▇▇▇▇ Purina Charitable Fund for
the Earnings Period. The earnings rate (which may be positive or negative)
shall be the investment rate of return on the assets of the ▇▇▇▇▇▇▇ Purina
Charitable Fund during the Earnings Period, as determined by the ▇▇▇▇▇▇▇
Trustee.
Energizer shall cause the Energizer Charitable Foundation to assume, as of the
Distribution Date, the obligation to pay certain pledge commitments of the
▇▇▇▇▇▇▇ Purina Charitable Fund as set forth in Schedule 2.07; provided however,
that the present value as of the Distribution Date, as determined by the ▇▇▇▇▇▇▇
Trustee, of such pledge commitments assumed by the Energizer Charitable
Foundation shall be no greater than the Charitable Transfer Amount. Energizer
shall timely notify, or shall cause the Energizer Charitable Foundation to
timely notify, in writing the recipients of such pledge commitments of its
assumption of such obligations from the ▇▇▇▇▇▇▇ Purina Charitable Fund. Any
pledge commitments entered into by the Energizer Charitable Foundation
subsequent to the Distribution Date shall be the sole obligation of the
Energizer Charitable Foundation and shall not be satisfied prior to the
Charitable Transfer Date with any assets held by the ▇▇▇▇▇▇▇ Purina Charitable
Fund on behalf of the Energizer Charitable Foundation. The Energizer Charitable
Foundation shall have no obligation to assume or satisfy any pledge commitment
of the ▇▇▇▇▇▇▇ Purina Charitable Fund that arises subsequent to the Distribution
Date other than those set forth in Schedule 2.07.
(b) If any of the pledge commitments assumed by the Energizer
Charitable Foundation as set forth on Schedule 2.07 become due and payable prior
to the Charitable Transfer Date, the ▇▇▇▇▇▇▇ Purina Charitable Fund shall
satisfy such pledge commitments on behalf of the Energizer Charitable Foundation
and the Charitable Transfer Amount shall be reduced by the amount of such pledge
commitments paid by the ▇▇▇▇▇▇▇ Purina Charitable Fund. As used herein, a
"pledge commitment" shall mean any commitment of the ▇▇▇▇▇▇▇ Purina Charitable
Fund to make a contribution of cash or other property or services for a purpose
described in Code Section 170(c)(2)(B). Contributions received by the ▇▇▇▇▇▇▇
Purina Charitable Fund subsequent to the Distribution Date shall be the sole
property of the ▇▇▇▇▇▇▇ Purina Charitable Fund and shall not be considered
assets subject to transfer under this Agreement. Contributions received by the
Energizer Charitable Foundation subsequent to the Distribution Date shall be the
sole property of the Energizer Charitable Foundation.
Notwithstanding the foregoing, the transfer of assets and the assumption of
pledge commitments described in subparagraph (a) (the "Charitable Transfer")
shall be conditioned upon the following: (i) the consummation of the
Distribution as contemplated under this Agreement; (ii) the receipt of a
determination letter from the Internal Revenue Service that the Energizer
Charitable Foundation, and any successor to the ▇▇▇▇▇▇▇ Purina Charitable Fund
if its formation is necessary to consummate the Charitable Transfer (the
"▇▇▇▇▇▇▇ Successor Fund"), is exempt under Code Section 501(c)(3); (iii) the
receipt by ▇▇▇▇▇▇▇ of a private letter ruling from the Internal Revenue Service
(A) determining whether the Charitable Transfer imposes any "expenditure
responsibility" on ▇▇▇▇▇▇▇ or the ▇▇▇▇▇▇▇ Charitable Fund pursuant to Code
Section 4945; and (B) holding that the Charitable Transfer does not violate the
Code Section 501(c)(3) exemption of the ▇▇▇▇▇▇▇ Purina Charitable Fund or the
▇▇▇▇▇▇▇ Successor Fund, nor result in any taxes under Code Section 507 or
Chapter 42 of the Code; and (iv) the execution by the ▇▇▇▇▇▇▇ Charitable Fund
and the Energizer Charitable Foundation of a grant agreement satisfactory to
▇▇▇▇▇▇▇, to the extent required under Code Section 4945. ▇▇▇▇▇▇▇ and Energizer
shall cooperate fully and use their best efforts to satisfy the conditions of
the Charitable Transfer. ▇▇▇▇▇▇▇ and Energizer shall, and shall cause each
member of the ▇▇▇▇▇▇▇ Group and Energizer Group, respectively, to refrain from
taking any action which would adversely impact the receipt of any favorable
ruling or determination letter obtained from the IRS or the continued validity
of such ruling or letter as contemplated in this subparagraph (b).
(c) Energizer shall cause the Energizer Charitable Foundation to
cooperate fully and take all steps necessary as requested by the ▇▇▇▇▇▇▇
Charitable Fund to satisfy any "expenditure responsibility" ▇▇▇▇▇▇▇ or the
▇▇▇▇▇▇▇ Charitable Fund may retain with respect to the Energizer Charitable
Foundation, in accordance with Code Section 4945. ▇▇▇▇▇▇▇ and Energizer shall
if feasible structure the Charitable Transfer in a manner that will minimize any
and all costs related to the Charitable Transfer, including any taxes imposed by
Code Section 507(c) and Chapter 42 of the Code.
ARTICLE III
THE DISTRIBUTION
3.01 Record Date and Distribution Date. Subject to the satisfaction of
---------------------------------
the conditions set forth in Section 12.01, the ▇▇▇▇▇▇▇ Board shall establish the
Record Date and the Distribution Date and any appropriate procedures in
connection with the Distribution. The determination of record holders of
▇▇▇▇▇▇▇ Stock on the Record Date shall be as of the close of business on March
31, 2000, and the Distribution shall be effective as of 12:01 a.m. on the
Distribution Date.
3.02 Distribution. ▇▇▇▇▇▇▇ shall distribute all of the outstanding
------------
shares of Energizer Stock to holders of record of ▇▇▇▇▇▇▇ Stock on the Record
Date on the basis of one share of Energizer Stock for each three shares of
▇▇▇▇▇▇▇ Stock outstanding as of 12:01 a.m. on the Distribution Date, subject to
the treatment of fractional shares set forth in Section 3.03. All shares of
Energizer Stock issued in the Distribution shall be duly authorized, validly
issued, fully paid and nonassessable.
3.03 Payment in Lieu of Fractional Shares. No fractional shares of
----------------------------------------
Energizer Stock shall be issued in the Distribution. In lieu thereof, a
distribution agent will aggregate fractional shares into whole shares and sell
them in the open market at then prevailing prices on behalf of holders who
otherwise would be entitled to receive fractional share interests, and such
distribution agent shall remit to each holder of ▇▇▇▇▇▇▇ Stock who would
otherwise be entitled to receive such fractional shares a cash payment equal to
such holder's pro rata share of the total gross sale proceeds (after making
appropriate deductions of the amount required to satisfy legal requirements).
▇▇▇▇▇▇▇ shall bear the cost of commissions incurred in connection with such
sales.
ARTICLE IV
INDEMNIFICATION
4.01 Indemnification.
---------------
(a) From and after the Distribution Date, ▇▇▇▇▇▇▇ agrees to indemnify and
hold harmless Energizer against and in respect of any and all Liabilities
assumed or retained by ▇▇▇▇▇▇▇ pursuant to Section 2.04(b) of this Agreement
and/or related to, arising from, or associated with:
(i) any breach or violation of any covenant made in this Agreement or
any Ancillary Agreement by ▇▇▇▇▇▇▇ or any of its Affiliates;
(ii) any Third-Party Claim relating to the actions of the ▇▇▇▇▇▇▇ Board
in authorizing the Distribution;
(iii) the ownership, use or possession of the ▇▇▇▇▇▇▇ Assets or the
operation of the ▇▇▇▇▇▇▇ Business or Former ▇▇▇▇▇▇▇ Businesses, whether relating
to or arising out of occurrences prior to or after the Distribution, except to
the extent liability therefor is specifically assumed or retained by Energizer
or another member of the Energizer Group pursuant to Section 2.04(b) of this
Agreement; and all operations conducted by ▇▇▇▇▇▇▇, its successors and their
Affiliates following the Distribution.
(iv) with respect to the operation or administration of Plans by
▇▇▇▇▇▇▇ Employees, Former ▇▇▇▇▇▇▇ Employees or agents of ▇▇▇▇▇▇▇ or the ▇▇▇▇▇▇▇
Business, ▇▇▇▇▇▇▇'▇ failure to comply with the provisions of a Plan or
applicable laws and regulations prior to or after the Distribution;
(v) any violations of the Code, or of federal or state securities laws,
in connection with the Distribution, the Information Statement and Form 10 or
any filings made with governmental agencies with respect thereto, except to the
extent that such violations, or allegations of violations, result from or are
related to the disclosure to ▇▇▇▇▇▇▇'▇ corporate staff of information, or
failure to disclose information, by officers, directors, employees, agents,
consultants or representatives of the Battery Business; and
(vi) any activity (other than the Charitable Transfer as
described in Section 2.07), operation, expenditure, distribution, act or
failure to act by the ▇▇▇▇▇▇▇ Purina Charitable Fund prior to the Charitable
Transfer, including any transferee or similar liability. Such indemnification
for any and all costs and expenses shall include any tax, penalty, interest or
litigation expense that may be incurred by or imposed on Energizer or
the Energizer Charitable Foundation.
Any indemnification provided for under this Section shall, to the extent legally
permissible, also be deemed to extend to other members of the Energizer Group,
Affiliates, Energizer Charitable Foundation, Energizer Employees, directors,
Plan fiduciaries, shareholders, agents, consultants, representatives,
successors, transferees and assigns of Energizer or members of the Energizer
Group.
(b) From and after the Distribution Date, Energizer agrees to indemnify
and hold harmless ▇▇▇▇▇▇▇ against and in respect of all Liabilities assumed or
retained by Energizer or another member of the Energizer Group pursuant to
Section 2.04(b) of this Agreement and/or related to, arising from, or associated
with:
(i) any breach or violation of any covenant made in this Agreement or
any Ancillary Agreement by Energizer or any of its Affiliates;
(ii) the ownership, use or possession of the Energizer Assets or the
operation of the Battery Business or Former Battery Businesses, whether relating
to or arising out of occurrences prior to or after the Distribution, except to
the extent liability therefor is specifically assumed or retained by ▇▇▇▇▇▇▇ or
another member of the ▇▇▇▇▇▇▇ Group pursuant to Section 2.04(b) of this
Agreement; and all operations conducted by Energizer, its successors and their
Affiliates following the Distribution;
(iii) with respect to the operation or administration of Plans by
Energizer Employees, Former Energizer Employees or agents of Energizer or the
Battery Business, Energizer's failure to comply with the provisions of a Plan or
applicable laws and regulations prior to or after the Distribution;
(iv) any violation or allegations of violations of federal or state
securities laws in connection with the Distribution, the Information Statement
and Form 10 or any filings made with governmental agencies with respect thereto,
to the extent that such violations, or allegations of violations, result from or
are related to, the disclosure to ▇▇▇▇▇▇▇'▇ corporate staff of information, or
failure to disclose information, by officers, directors, employees, agents,
consultants or representatives of the Battery Business;
(v) any and all obligations and Liabilities of ▇▇▇▇▇▇▇ (other than
certain fees set forth in Section 12.04) related to, or arising in connection
with, Energizer's establishment of a $175 million private placement of unsecured
notes, ▇▇▇▇▇▇▇'▇ and Energizer's establishment of a $450 million bank
syndication credit facility and Energizer's establishment of a $200 million
credit facility for the purpose of selling, on a revolving basis, undivided
ownership interest in accounts receivable of the Battery Business;
(vi) the Charitable Transfer, as described in Section 2.07 hereunder,
including any taxes imposed by Code Sections 170, 507(c), or Chapter 42 of the
Code, any penalty, interest or litigation expense that may be incurred by or
imposed on ▇▇▇▇▇▇▇, the ▇▇▇▇▇▇▇ Purina Charitable Fund or Successor Fund,
including, without limitation, costs arising as a result of (i) the ▇▇▇▇▇▇▇
Purina Charitable Fund's retaining expenditure responsibility with respect to
such assets; (ii) ▇▇▇▇▇▇▇'▇ status as a "substantial contributor" with respect
to the Energizer Charitable Foundation in accordance with Code Section 507;
(iii) the Charitable Transfer's being treated as a "significant disposition of
assets" under Code Section 507, and (iv) any failure of the Energizer Charitable
Foundation to satisfy the pledge commitments assumed from the ▇▇▇▇▇▇▇ Purina
Charitable Fund;
(vii) any occurrence, conduct or action of or involving Energizer,
any member of the Energizer Group, Energizer Affiliates, Energizer Indivi-
duals, directors, Plan fiduciaries, shareholders, agents, consultants, represen-
tatives, successors, transferees or assigns of Energizer or members of the
Energizer Group, which is alleged to constitute a breach or violation of
either Section 6.01 of the DuPont Agreement, or Section 5.01 of the Agree-
ment and Plan of Reorganization dated as of April 1, 1998 by and between Ral-
ston and Agribrands International, Inc; and
(viii) any Liabilities of ▇▇▇▇▇▇▇ arising out of any amendments which
may be adopted by Energizer or its Affiliates, as permitted under Section 7.18
of this Agreement, with respect to Plans affecting Energizer Individuals.
Any indemnification provided for under this Section shall, to the extent
legally permissible, also be deemed to extend to other members of the ▇▇▇▇▇▇▇
Group, Affiliates, ▇▇▇▇▇▇▇ Employees, directors, Plan fiduciaries, the ▇▇▇▇▇▇▇
Charitable Fund, shareholders, agents, consultants, representatives, successors,
transferees and assigns of ▇▇▇▇▇▇▇ or members of the ▇▇▇▇▇▇▇ Group.
(c) For purposes of this Section 4.01, an Energizer Employee or Former
Energizer Employee shall be considered an agent of ▇▇▇▇▇▇▇ or the ▇▇▇▇▇▇▇
Business only if such individual acted pursuant to direction from a person who,
at the time of the direction, was an employee of the ▇▇▇▇▇▇▇ Business (including
employees of the corporate division of ▇▇▇▇▇▇▇). A ▇▇▇▇▇▇▇ Employee or Former
▇▇▇▇▇▇▇ Employee shall be considered an agent of Energizer or the Battery
Business only if such individual acted pursuant to direction from a person who,
at the time of the direction, was an employee of the Battery Business.
(d) Except with respect to Liabilities subject to Section 4.01(b)(vii), a
party shall have no right to indemnification under this Article IV until the
cumulative aggregate dollar amount of all Liabilities to which this Article
applies equals or exceeds US$250,000 with respect to such party. Liabilities of
any amount shall be included in the computation of the cumulative aggregate
dollar amount of Liabilities, but, except with respect to Liabilities subject to
Section 4.01(b)(vii), neither party shall be entitled to indemnification for any
single Liability of less than US$25,000. Energizer shall indemnify and hold
harmless ▇▇▇▇▇▇▇ against and in respect of all Liabilities subject to Section
4.01(b)(vii), regardless of the amount or nature thereof.
4.02 Actions and Claims Other Than Third-Party Claims; Notice and
------------------------------------------------------------------
Payment. Upon obtaining knowledge of any Action, Liability or claim, other than
Third-Party Claims, which any Person entitled to indemnification (the
"Indemnitee") believes may give rise to any Indemnifiable Loss, the Indemnitee
shall promptly notify the party liable for such indemnification (the
"Indemnitor") in writing of such Action or claim (such written notice being
hereinafter referred to as a "Notice of Claim"); provided, however, that failure
of an Indemnitee timely to give a Notice of Claim to the Indemnitor shall not
release the Indemnitor from its indemnity obligations set forth in this Article
IV except to the extent that such failure increases the amount of
indemnification which the Indemnitor is obligated to pay hereunder, in which
event the amount of indemnification which the Indemnitee shall be entitled to
receive shall be reduced to an amount which the Indemnitee would have been
entitled to receive had such Notice of Claim been timely given. A Notice of
Claim shall specify in reasonable detail the nature and estimated amount of any
such Action, Liability or claim giving rise to a right of indemnification. The
Indemnitor shall have ninety (90) Business Days after receipt of a Notice of
Claim to notify the Indemnitee whether or not it disputes its liability to the
Indemnitee with respect to such Action, Liability or claim or the amount
thereof, and setting forth the basis for such objection. If the Indemnitor
fails to respond to the Indemnitee within such ninety (90) Business Day period,
the Indemnitor shall be deemed to have acknowledged its responsibility for such
Indemnifiable Loss. If such Indemnifiable Loss is not contested, the Indemnitor
shall pay and discharge any such Indemnifiable Loss within one hundred twenty
(120) Business Days after its receipt of a Notice of Claim.
4.03 Insurance and Third-Party Obligations.
----------------------------------------
(a) Any indemnification otherwise payable pursuant to Section 4.01 shall
be reduced by the amount of any insurance or other amounts (net of deductibles
and allocated paid loss retro-premiums) that would be payable by any third party
to the Indemnitee or on the Indemnitee's behalf in the absence of this
Agreement. It is expressly agreed that no insurer or any other third party
shall be (i) entitled to a benefit it would not be entitled to receive in the
absence of the foregoing indemnification provisions, (ii) relieved of the
responsibility to pay any claims for which it is obligated, or (iii) entitled to
any subrogation rights with respect to any obligation hereunder.
(b) ▇▇▇▇▇▇▇ hereby assigns to Energizer any amounts payable to ▇▇▇▇▇▇▇ or
a member of the ▇▇▇▇▇▇▇ Group under any property or casualty insurance policy to
the extent that such amounts relate to claims associated solely with the Battery
Business or the Energizer Assets. To the extent any further documentation or
instruments are reasonably requested by Energizer to effect such assignment,
▇▇▇▇▇▇▇ agrees to promptly execute the same. ▇▇▇▇▇▇▇ agrees to take all other
actions reasonably requested by Energizer to timely pursue Energizer's rights
and remedies under such policies, and Energizer shall bear any costs associated
with such actions.
4.04 Third-Party Claims; Notice, Defense and Payment. Promptly
----------------------------------------------------
following the earlier of (i) receipt of notice of the commencement of a
Third-Party Claim or (ii) receipt of information from a third party alleging the
existence of a Third-Party Claim, any Indemnitee who believes that it is or may
be entitled to indemnification by any Indemnitor under Section 4.01 with respect
to such Third-Party Claim shall deliver a Notice of Claim to the Indemnitor.
Failure of an Indemnitee timely to give a Notice of Claim to the Indemnitor
shall not release the Indemnitor from its indemnity obligations set forth in
this Section 4.04 except to the extent that such failure adversely affects the
ability of the Indemnitor to defend such Action, Liabilities or claim or
increases the amount of indemnification which the Indemnitor is obligated to pay
hereunder, in which event the amount of indemnification which the Indemnitee
shall be entitled to receive shall be reduced to an amount which the Indemnitee
would have been entitled to receive had such Notice of Claim been timely given.
Indemnitee shall not settle or compromise any Third-Party Claim in an amount in
excess of US$25,000 prior to giving a Notice of Claim to Indemnitor at least
twenty (20) Business Days in advance of such settlement. In addition, if an
Indemnitee settles or compromises any Third-Party Claims prior to giving such
Notice of Claim to an Indemnitor, the Indemnitor shall be released from its
indemnity obligations to the extent that the Indemnitor can sustain the burden
of proving that such settlement or compromise was not made in good faith and was
not commercially reasonable. Within ninety (90) days after receipt of such
Notice of Claim (or sooner if the nature of such Third-Party Claim so requires),
the Indemnitor may (A) by giving written notice thereof to the Indemnitee,
acknowledge liability for, and at its option elect to assume, the defense of
such Third-Party Claim at its sole cost and expense or (B) object to the claim
of indemnification set forth in the Notice of Claim delivered by the Indemnitee;
provided that if the Indemnitor does not within the same ninety (90) day period
give the Indemnitee written notice either objecting to such claim and setting
forth the grounds therefor or electing to assume the defense, the Indemnitor
shall be deemed to have acknowledged its responsibility to accept the defense
and its ultimate liability, if any, for such Third-Party Claim.
Any contest of a Third-Party Claim as to which the Indemnitor has elected to
assume the defense shall be conducted by attorneys employed by the Indemnitor
and reasonably satisfactory to the Indemnitee; provided that the Indemnitee
shall have the right to participate in such proceedings and to be represented by
attorneys of its own choosing at the Indemnitee's sole cost and expense. If the
Indemnitor assumes the defense of a Third-Party Claim, the Indemnitor may settle
or compromise the Third-Party Claim without the prior written consent of
Indemnitee only if such settlement or compromise involves the payment of
monetary damages for which the Indemnitor alone shall be responsible. If such
settlement or compromise involves any legal or equitable remedy or relief to be
applied against the Indemnitee, or any change or compromise to any contractual
or other rights of the Indemnitee, then such settlement or compromise shall only
be effected with the prior written consent of the Indemnitee, which consent
shall not be unreasonably withheld.
If the Indemnitor does not assume the defense of a Third-Party Claim for which
it has acknowledged liability for indemnification under Section 4.01, the
Indemnitee may require the Indemnitor to reimburse it on a current basis for its
reasonable expenses of investigation, reasonable attorney's fees and reasonable
out-of-pocket expenses incurred in defending against such Third-Party Claim and
the Indemnitor shall be bound by the result obtained with respect thereto by the
Indemnitee, provided that the Indemnitor shall not be liable for any settlement
effected without its consent, which consent shall not be unreasonably withheld.
The Indemnitor shall pay to the Indemnitee in cash the amount for which the
Indemnitee is entitled to be indemnified (if any) within thirty (30) days after
the final resolution of such Third-Party Claim (whether by settlement, a final
nonappealable judgment of a court of competent jurisdiction or otherwise) or, in
the case of any Third-Party Claim as to which the Indemnitor has not
acknowledged liability, within thirty (30) days after such Indemnitor's
objection has been resolved by settlement, compromise or arbitration pursuant to
the provisions of Article XI of this Agreement.
4.05 Remedies Cumulative; Survival of Indemnities. The remedies
------------------------------------------------
provided in this Article IV shall be cumulative and shall not preclude assertion
by any Indemnitee of any other rights or the seeking of any and all other
remedies against any Indemnitor. The obligations of each of the ▇▇▇▇▇▇▇ Group
and the Energizer Group under this Article IV shall survive the sale or other
transfer by it of any assets or businesses or the assignment by it of any
Liabilities, with respect to any claim of the other for any Indemnifiable Losses
related to such assets, businesses or Liabilities.
ARTICLE V
CERTAIN ADDITIONAL COVENANTS
5.01 Further Assurances. Each party hereto shall cooperate with the
-------------------
other parties, and execute and deliver, or use its best efforts to cause to be
executed and delivered, all instruments, including instruments of conveyance,
assignment and transfer, and to make all filings with, and to obtain all
consents, approvals or authorizations of, any governmental or regulatory
authority or any other Person under any permit, license, agreement, indenture or
other instrument, and take all such other actions as such party may reasonably
be requested to take by any other party hereto from time to time, consistent
with the terms of this Agreement, in order to effectuate the provisions and
purposes of this Agreement and the transfers of Assets and Liabilities and the
other transactions contemplated hereby or in any of the Ancillary Agreements.
If any such transfer of Assets or Liabilities is not consummated prior to or on
the Distribution Date, then the party hereto retaining such Asset or Liability
shall thereafter hold such Asset in trust for the use and benefit of the party
entitled thereto (at the expense of the party entitled thereto), or shall retain
such Liability for the account of the party by whom such Liability is to be
assumed pursuant hereto, as the case may be, and shall take such other action as
may be reasonably requested by the party to whom such Asset is to be
transferred, or by whom such Liability is to be assumed, as the case may be, in
order to place such party, insofar as reasonably possible, in the same position
as if such Asset or Liability had been transferred as contemplated hereby. If
and when any such Asset or Liability becomes transferable, such transfer shall
be effected forthwith. The parties hereto agree that, as of the Distribution
Date, each party hereto shall be deemed to have acquired complete and sole
beneficial ownership of all of the Energizer Assets, or ▇▇▇▇▇▇▇ Assets, as the
case may be, together with all rights, powers and privileges incident thereto,
and shall be deemed to have assumed in accordance with the terms of this
Agreement all of the Liabilities, and all duties, obligations and
responsibilities incident thereto, that such party is entitled to acquire or
required to assume pursuant to the terms of this Agreement.
5.02 Energizer Board. Prior to the Distribution Date, Energizer shall
----------------
take such actions as are necessary so that its Board of Directors is comprised
of those individuals named as directors in the Form 10.
5.03 Contractual Arrangements.
-------------------------
(a) Effective as of the Distribution Date, ▇▇▇▇▇▇▇ and Energizer shall
enter into a tax sharing agreement, substantially in the form attached to this
Agreement as Exhibit A ("Tax Sharing Agreement").
(b) Effective as of the Distribution Date, ▇▇▇▇▇▇▇ and Energizer shall
enter into a bridging services agreement, substantially in the form attached to
this Agreement as Exhibit B ("Bridging Services Agreement").
(c) Effective as of the Distribution Date, ▇▇▇▇▇▇▇ and Energizer shall
enter into an intellectual property agreement, substantially in the form
attached to this Agreement as Exhibit C ("IP Agreement").
(d) Effective as of the Distribution Date, ▇▇▇▇▇▇▇ and Energizer shall
enter into an Aircraft Agreement, substantially in the form attached to this
Agreement as Exhibit D.
5.04 Cash Management and Intercompany Accounts.
----------------------------------------------
(a) Through and including 12:01 a.m. local time on the Distribution
Date, ▇▇▇▇▇▇▇ and Energizer shall continue to employ cash management and other
business practices with respect to the Battery Business that are consistent with
those practices historically employed.
(b) Except as otherwise provided on Schedule 5.04(b)(1), all bank
accounts used exclusively in the Battery Business, and the balances therein
existing as of 12:01 a.m. local time on the Distribution Date, shall be
transferred to, or retained by, members of the Energizer Group effective as of
the Distribution Date. All bank accounts used exclusively in the ▇▇▇▇▇▇▇
Business, and the balances therein existing as of 12:01 a.m. local time on the
Distribution Date, shall be transferred to, or retained by, members of the
▇▇▇▇▇▇▇ Group effective as of the Distribution Date. Each party shall promptly
pay to the other any amounts collected by it following the Distribution through
any of its accounts, to the extent any of such amounts collected relate
exclusively to the Business of the other party.
(c) All intercompany services provided by the ▇▇▇▇▇▇▇ Business to the
Battery Business , and vice versa, shall terminate as of the Distribution Date
unless otherwise provided in the Bridging Services Agreement or any other
Ancillary Agreement. Effective as of the close of business on March 31, 2000,
all intercompany receivables or payables and loans then existing between any
member of one Group and any member of the other Group shall be forgiven, except
that trade receivables or payables arising out of intercompany sales of
inventories or other tangible goods, and claims between any member of the
Energizer Group and Checkerboard Insurance Company, shall be settled in the
normal course of business.
ARTICLE VI
ACCESS TO INFORMATION
6.01 Provision of Corporate Records. Subject to the terms of the
---------------------------------
Ancillary Agreements, prior to, or as promptly as practicable after, the
Distribution Date, ▇▇▇▇▇▇▇ shall deliver to Energizer, and Energizer shall
deliver to ▇▇▇▇▇▇▇, all corporate books and records pertaining to the other
party's Business that each has in its possession. The parties shall also make
available for copying or, to the extent not detrimental, in the reasonable
opinion of the party in possession of the materials, to such party's interests,
originals of all books, records and data reasonably related to the Assets, the
Battery Business, and the Liabilities assumed or retained by the party
requesting such materials, including, but not limited to, all books, records and
data relating to the purchase of materials, supplies and services, financial
results, sale of products, records of the applicable Energizer or ▇▇▇▇▇▇▇
Individuals, commercial data, catalogues, brochures, training and other manuals,
sales literature, advertising and other sales and promotional materials,
maintenance records and drawings, all active agreements, active litigation files
and government filings. To the extent that originals of such books, records and
data are provided to Energizer by ▇▇▇▇▇▇▇ or vice versa, the party to which the
originals are given shall provide to the other party copies thereof as
reasonably requested in writing.
Each party shall provide such copies of all books, records and data only to the
extent that such action is not prohibited by the terms of any agreements
pertaining to such information or is not prohibited by law. From and after the
Distribution Date, all books, records and copies so delivered shall be the
property of the party to which they were given. Notwithstanding the above,
neither party shall be required to make copies, other than pursuant to Section
6.02 of this Agreement, of any books, records and data which are more than seven
years old or which relate to events occurring more than seven (7) years prior to
the Distribution Date.
6.02 Access to Information. From and after the Distribution Date,
-----------------------
▇▇▇▇▇▇▇ and Energizer shall afford, to the other and to the other's agents,
employees, accountants, counsel and other designated representatives, reasonable
access and duplicating rights during normal business hours to all records,
books, contracts, instruments, computer data and other data and information
("Information") within such party's possession relating to such other party's
businesses, assets or liabilities, insofar as such access is reasonably required
by such other party. Without limiting the foregoing, such Information may be
requested under this Section 6.02 for audit, accounting, claims, litigation and
tax purposes, as well as for purposes of fulfilling disclosure and reporting
obligations.
6.03 Retention of Records. Except as otherwise required by law or
----------------------
agreed in writing, or as otherwise provided in the Tax Sharing Agreement,
▇▇▇▇▇▇▇ and Energizer shall retain, for a period of at least seven (7) years
following the Distribution Date, all significant Information in such party's
possession or under its control relating to the Business, Assets or Liabilities
of the other party and, after the expiration of such seven-year period, prior to
destroying or disposing of any of such Information, (i) the party proposing to
dispose of or destroy any such Information shall provide no less than 30 days'
prior written notice to the other party, specifying the Information proposed to
be destroyed or disposed of, and (ii) if, prior to the scheduled date for such
destruction or disposal, the other party requests in writing that any of the
Information proposed to be destroyed or disposed of be delivered to such other
party, the party proposing to dispose of or destroy such Information promptly
shall arrange for the delivery of the requested Information to a location
specified by, and at the expense of, the requesting party.
6.04 Confidentiality. From and after the Distribution Date, each Group
---------------
shall hold, in strict confidence, all Information obtained from the other Group
prior to the Distribution Date or furnished to it pursuant to this Agreement or
any other agreement referred to herein which relates to or concerns the business
conducted by such other Group, and such Information shall not be used by it to
the detriment of the other Group, or disclosed by it or its agents, officers,
employees or directors without the prior written consent of such other Group
unless and to the extent that:
(a) disclosure is compelled by judicial or administrative process or, in
the opinion of such Group's counsel, by other requirements of law; or
(b) such Group can show that such Information was:
(i) available to such Group on a nonconfidential basis prior to its dis-
closure by the other Group,
(ii) in the public domain through no fault of such Group,
(iii) lawfully acquired by such Group from other sources after the time
that it was furnished to such Group pursuant to this Agreement or any other
agreement referred to herein, or
(iv) independently developed by such Group.
Notwithstanding the foregoing, each Group shall be deemed to have satisfied its
obligations of confidentiality under this Section 6.04 with respect to any
Information concerning or supplied by the other Group if it exercises
substantially the same care with regard to such Information as it takes to
preserve confidentiality for its own similar Information.
6.05 Reimbursement. Each member of any Group providing Information
-------------
pursuant to Sections 6.02 or 6.03 to any member of the other Group shall be
entitled to receive from the recipient, upon presentation of an invoice
therefor, payment in U. S. dollars of all out-of-pocket costs and expenses as
may reasonably be incurred in providing such Information.
ARTICLE VII
EMPLOYEE MATTERS
7.01 Employee Liabilities; Continuation of Employment.
-----------------------------------------------------
After the Distribution, except as otherwise specifically provided for in
this Agreement and Plan of Reorganization, the Energizer Group shall be
responsible for all employment and benefit liabilities related to the Energizer
Individuals, and the ▇▇▇▇▇▇▇ Group shall be responsible for all employment and
benefit liabilities related to the ▇▇▇▇▇▇▇ Individuals, whether arising before,
coincident with or after the Distribution. ▇▇▇▇▇▇▇ and Energizer shall cause
each member of their respective Groups to cooperate with the members of the
other's Group to effect, as soon as practicable in a cost-effective manner, the
transfer of employment, where applicable, of Energizer Employees and ▇▇▇▇▇▇▇
Employees to the appropriate Affiliate of either Group.
7.02 ▇▇▇▇▇▇▇ Purina Retirement Plan.
---------------------------------
(a) Effective as of the Distribution Date, Energizer shall take, or
cause to be taken, all actions necessary and appropriate to establish, effective
as of the Distribution Date, an Energizer Retirement Plan and trust intended to
qualify under Sections 401(a) and 501(a) of the Code, respectively, and to
provide benefits thereunder for all Energizer Individuals who, on the
Distribution Date, were participants in the ▇▇▇▇▇▇▇ Retirement Plan. All
liabilities for benefits accrued for Energizer Individuals under the ▇▇▇▇▇▇▇
Retirement Plan shall be transferred to the Energizer Retirement Plan, the terms
of which will be substantially the same as those of the ▇▇▇▇▇▇▇ Retirement Plan
in respect of the Energizer Individuals. Such transfer and assumption of
liabilities shall be consistent with the spin-off of the ▇▇▇▇▇▇▇ Retirement
Plan, in accordance with Code Section 414(l) and the regulations thereunder.
The Energizer Retirement Plan shall give the Energizer Employees credit, for
purposes of eligibility, vesting and benefit accrual, for service on or prior to
the Distribution Date, to the extent such service was recognized under the
▇▇▇▇▇▇▇ Retirement Plan. As soon as practicable after the Distribution Date,
▇▇▇▇▇▇▇ shall cause the trustee of the ▇▇▇▇▇▇▇ Retirement Plan to transfer, in
one or more installments, to the trustee of the Energizer Retirement Plan, in
accordance with Sections 7.02(c) and (e) below, an amount in cash and other
liquid assets held in the trust equal to the following, adjusted as applicable
pursuant to Section 7.02(d) below (the "Transfer Amount"):
(i) the Projected Benefit Obligation ("PBO"), as defined in Financial
Accounting Standards 87, attributable to pension benefits (other than
PensionPlus Match Accounts) developed as of the Distribution Date with re-
spect to the Energizer Individuals under the ▇▇▇▇▇▇▇ Retirement Plan; plus
(ii) amounts credited to the PensionPlus Match Accounts as
developed for Energizer Individuals as of the Distribution Date; plus
(iii) a pro rata share of the assets, with a market value determined as of
March 31, 2000, of the ▇▇▇▇▇▇▇ Retirement Plan in excess of the assets
required to fund the PBO and PensionPlus Match Accounts developed for all
participants and beneficiaries in the ▇▇▇▇▇▇▇ Retirement Plan (the "Surplus
Assets"), such share of the Surplus Assets to be apportioned and
transferred to the Energizer Retirement Plan in the same proportion as the
PBO liabilities and the amounts credited to the PensionPlus Match Accounts,
developed for Energizer Individuals as of March 31, 2000, bear to the PBO
liabilities and the amounts credited to the PensionPlus Match Accounts
developed for all participants in the ▇▇▇▇▇▇▇ Retirement Plan as of
March 31, 2000; plus
(iv) interest with respect to each installment of the Transfer Amount
based on the investment rate of return of the assets of the ▇▇▇▇▇▇▇ Retirement
Plan from the Distribution Date to the actual transfer date, net of invest-
ment fees and expenses for that period; less
(v) the amount of benefits paid by the ▇▇▇▇▇▇▇ Retirement Plan to
Energizer Individuals between the Distribution Date and the date Plan
assets are transferred.
Calculations of PBO shall be made in accordance with terms of the ▇▇▇▇▇▇▇
Retirement Plan, established administrative procedures and the economic
assumptions used by ▇▇▇▇▇▇▇ as of September 30, 1999 under FAS 87 (including a
discount rate of 7.00%) and the non-economic assumptions (including rates of
mortality, retirement, termination and disability) as set forth in Schedule B to
the 1999 Form 5500 for the ▇▇▇▇▇▇▇ Retirement Plan. For purposes of determining
the Transfer Amount, the PBO liability and the PensionPlus Match Accounts shall
be developed as of March 31, 2000 by calculating and measuring those amounts as
of October 1, 1999 on the basis described above - reflecting participant
information gathered as of October 1, 1999 as adjusted to reflect the transfer
of participants between the Energizer Business and the ▇▇▇▇▇▇▇ Business during
the period October 1, 1999 through March 31, 2000 - and projecting those amounts
forward to March 31, 2000. The projecting of the PBO liability shall take into
consideration (a) the additional liability attributable to benefits earned by
active participants in the ▇▇▇▇▇▇▇ Retirement Plan during the period October 1,
1999 through March 31, 2000 (as represented by 50% of the annual Service Cost -
as defined under FAS 87 - developed as of October 1, 1999); (b) the interest
accumulated on the liability during that six month period (as represented by 50%
of the annual Interest Cost - as defined under FAS 87 - developed using the PBO
calculated as of October 1, 1999 and reflecting the 7.00% discount rate
indicated above); and (c) the aggregate benefit payments anticipated to be
received during the six month period by all retirees reported as of October 1,
1999. The PensionPlus Match Accounts shall be projected to March 31, 2000 for
all participants by increasing the PensionPlus Match Account balances - measured
as of October 1, 1999 - by (a) six months of interest credited at a rate of
6.00% per annum; and (b) six months of anticipated contributions to the accounts
developed by assuming that the participants' after-tax supplemental
contributions to the ▇▇▇▇▇▇▇ SIP - measured as of October 1, 1999 - will remain
constant over the projection period and reflecting 50% of the participants' last
full calendar year of pensionable compensation collected as of October 1, 1999.
In no event will the Transfer Amount, as calculated pursuant to this Section
7.02(a) and, if applicable, adjusted pursuant to Section 7.02(d), be less than
the present value, determined in accordance with Section 417 of the Code, of
benefits of the Energizer Individuals accrued as of the Distribution Date, as
determined based on the actuarial assumptions of the ▇▇▇▇▇▇▇ Retirement Plan and
in compliance with Section 414(l) of the Code.
(b) No changes in the status of any Energizer Individual between the
Distribution Date and the date or dates funds are actually transferred pursuant
to this Section 7.02 shall affect the Transfer Amount to be calculated
hereunder.
(c) An initial portion of the Transfer Amount (the "Initial Transfer
Amount") shall be transferred to the trustee of the Energizer Retirement Plan as
soon as practicable after the expiration of the thirty-day waiting period
required by section 6058(b) of the Code. The transfer shall be conditioned upon
completion of the following items:
(i) ▇▇▇▇▇▇▇'▇ receipt of an opinion of counsel retained by Energi-
zer and reasonably satisfactory in form and substance to ▇▇▇▇▇▇▇ to the
effect that the Energizer Retirement Plan is a Qualified Plan and that the
trust established under such Plan is intended to be exempt from taxation under
Section 501(a) of the Code;
(ii) ▇▇▇▇▇▇▇'▇ filing with the Internal Revenue Service the notice
required by Section 6058(b) of the Code.
(d) Notwithstanding the foregoing Section 7.02(a), if an apportionment
of pension assets, including pension surplus, is not made with respect to the
▇▇▇▇▇▇▇ Canadian Pension Plan and/or the Energizer/▇▇▇▇▇▇▇ UK Pension Plan, as
defined below, in a manner similar to that described with respect to the ▇▇▇▇▇▇▇
Retirement Plan, then the Transfer Amount shall be increased or decreased, as
applicable, in an amount equal to the value of such excess or shortfall in
allocation of surplus assets in those Plans effective as of the date the parties
mutually agree on the amount of such excess or shortfall. The equivalent value
of US and applicable Canadian or United Kingdom currencies shall be determined
in accordance with Section 2.04(i).
(e) The parties shall cooperate in transferring the final installment
or installments of the Transfer Amount as soon as practicable. The final
installment of the Transfer Amount shall be made when it has been determined to
the reasonable satisfaction of both parties.
(f) Upon completion of the transfers of such assets and liabilities,
the ▇▇▇▇▇▇▇ Retirement Plan and the ▇▇▇▇▇▇▇ Group shall have no further
liability therefor with respect to the Energizer Individuals.
7.03 Certain International Pension Plans.
--------------------------------------
(a) Canadian Pension Plans. Effective as of the Distribution Date,
subject to the transfer of assets referred to below, the Energizer Employees
participating in the registered pension plan sponsored by ▇▇▇▇▇▇▇ Purina Canada
Inc. (the "▇▇▇▇▇▇▇ Canadian Pension Plan") shall cease to accrue benefits under
such Plan, and all liabilities for benefits accrued by Energizer Individuals as
of such Distribution Date shall be transferred to a new pension plan (the
"Energizer Canadian Pension Plan") established by Energizer Canada Inc., an
Affiliate of Energizer, the terms of which will be substantially the same as
those of the ▇▇▇▇▇▇▇ Canadian Pension Plan in respect of the Energizer
Individuals. The Energizer Canadian Pension Plan shall give the Energizer
Employees credit, for purposes of eligibility, vesting and benefit accrual, for
service on or prior to the Distribution Date, to the extent such service was
recognized under the ▇▇▇▇▇▇▇ Canadian Pension Plan.
▇▇▇▇▇▇▇ shall, as soon as practicable after the receipt of all requisite
governmental and other approvals and consents referred to below, cause ▇▇▇▇▇▇▇
Purina Canada Inc. to transfer from the ▇▇▇▇▇▇▇ Canadian Pension Plan to the
Energizer Canadian Pension Plan an amount of assets (the "Canadian Transfer
Amount") determined in accordance with the following formula:
(i) the fair market value of the assets attributable to the defined
benefit portion of the ▇▇▇▇▇▇▇ Canadian Pension Plan, determined as at March
31, 2000, shall be multiplied by a fraction, the numerator of which
shall be:
(A) the present value of defined benefits accrued by the Energizer Indivi-
duals under the ▇▇▇▇▇▇▇ Canadian Pension Plan as of March 31, 2000 determined
as the greater of the going concern or solvency liabilities in accordance with
▇▇▇▇▇▇▇ Canadian Pension Plan documents and actuarial assumptions and methods
used in the last filed actuarial report, adjusted as necessary to com-
ply with legislation and the requirements of regulatory authorities ("Canadian
Energizer Defined Benefit Liabilities");
and the denominator of which shall be:
(B) the present value of defined benefits accrued by all members and
former members (including without limitation the Energizer Individuals)
under the ▇▇▇▇▇▇▇ Canadian Pension Plan as of March 31, 2000 determined on the
same basis as the Canadian Energizer Defined Benefit Liabilities;
(ii) investment gains and losses on the amount determined in clause
7.03(a)(i) above shall accrue based on the investment rate of return of the
assets of the ▇▇▇▇▇▇▇ Canadian Pension Plan from the Distribution Date to the
actual transfer date, net of investment fees and expenses for such period;
and
(iii) the amount of benefits paid by the ▇▇▇▇▇▇▇ Canadian Pension Plan
to Energizer Individuals between the Distribution Date and the date the Cana-
▇▇▇▇ Transfer Amount is transferred shall be deducted from the aggregate
amount determined in accordance with clauses 7.03(a)(i) and 7.03(a)(ii)
above.
Such transfer shall be conditioned upon receipt of, and subject to, all
requisite governmental and other approvals and consents and if a different
Canadian Transfer Amount is required by applicable regulatory authorities, an
adjustment to the Canadian Transfer Amount will be made. Upon completion of the
transfer of such assets and liabilities, the ▇▇▇▇▇▇▇ Canadian Pension Plan and
the ▇▇▇▇▇▇▇ Group shall have no further liability for pension benefits for the
Energizer Individuals.
(b) United Kingdom Pension Plans. Effective as of the date of transfer
of the UK Transfer Amount as described below, the ▇▇▇▇▇▇▇ Individuals
participating in the pension plan offered by ▇▇▇▇▇▇▇ Trust Limited (the
"Energizer/▇▇▇▇▇▇▇ UK Pension Plan") shall cease to accrue benefits under such
Plan, and all liabilities for benefits accrued by such Individuals as of such
date shall be transferred to a new pension plan (the "New ▇▇▇▇▇▇▇ UK Pension
Plan") established by Purina Pension Trust Limited, an Affiliate of ▇▇▇▇▇▇▇, the
terms of which are substantially the same as those currently enjoyed by such
Individuals under the Energizer/▇▇▇▇▇▇▇ UK Pension Plan. The transfer date and
the contributions to be paid to the Energizer/▇▇▇▇▇▇▇ UK Pension Plan in respect
of the ▇▇▇▇▇▇▇ Individuals between March 31, 2000 and the transfer date is to be
agreed upon by the parties to this Agreement. The New ▇▇▇▇▇▇▇ UK Pension Plan
shall give the ▇▇▇▇▇▇▇ Employees credit, for purposes of eligibility, vesting
and benefit accrual, for service on or prior to the transfer date, to the extent
such service was recognized under the Energizer/▇▇▇▇▇▇▇ UK Pension Plan.
▇▇▇▇▇▇▇ shall cause the Purina Pension Trust Limited to, as soon as practicable
after the receipt of all requisite governmental and other approvals and consents
referred to below, seek a transfer from the Energizer/▇▇▇▇▇▇▇ UK Pension Plan to
the New ▇▇▇▇▇▇▇ UK Pension Plan of an amount of assets (the "UK Transfer
Amount") determined in accordance with the following formula:
(i) The fair market value of the assets of the Energizer/▇▇▇▇▇▇▇ UK
Pension Plan, determined as at March 31, 2000, shall be multiplied by a frac-
tion ("the Transfer Fraction"), the numerator of which shall be:
(A) the present value of benefits accrued by the ▇▇▇▇▇▇▇ Individuals under
the Energizer/▇▇▇▇▇▇▇ UK Pension Plan as of March 31, 2000 determined as the
greater of the going concern or solvency liabilities in accordance with
Energizer/▇▇▇▇▇▇▇ UK Pension Plan documents and actuarial assumptions and
methods used in the last filed actuarial report, adjusted as necessary to comply
with legislation and the requirements of regulatory authorities ("▇▇▇▇▇▇▇
Individuals Liabilities");
and the denominator of which shall be:
(B) the present value of benefits accrued by all members and former
members (including without limitation the ▇▇▇▇▇▇▇ Individuals) under the
Energizer/▇▇▇▇▇▇▇ UK Pension Plan as of March 31, 2000 determined on the same
basis as the ▇▇▇▇▇▇▇ Individuals Liabilities.
(ii) Assets transferred to the Energizer/▇▇▇▇▇▇▇ UK Pension Plan af-
ter the Distribution Date, in connection with the pension arrangements ari-
sing out of the acquisition by ▇▇▇▇▇▇▇ of the ▇▇▇▇▇▇ ▇▇▇▇▇ Pet Foods business,
shall be valued at fair market value as of the date such assets are
received by the Energizer/▇▇▇▇▇▇▇ UK Pension Plan, and multiplied by the
Transfer Fraction.
(iii) Investment gains and losses on the amounts determined in
clauses 7.03(b)(i) and 7.03(b)(ii) above shall accrue based on the investment
rate of return of the assets of the Energizer/▇▇▇▇▇▇▇ UK Pension Plan from
(A) with respect to clause 7.03(b)(i), the Distribution Date to the actual
transfer date; and (B) with respect to clause 7.03(b)(ii), the date such assets
are received by the Energizer/▇▇▇▇▇▇▇ UK Pension Plan to the transfer date,
and the return on both amounts is to be net of investment fees and expenses
for the applicable period.
(iv) The amount of benefits paid by the Energizer/▇▇▇▇▇▇▇ UK Pension
Plan to ▇▇▇▇▇▇▇ Individuals between the Distribution Date and the date the UK
Transfer Amount is transferred shall be deducted from the aggregate amount de-
termined in accordance with clauses 7.03(b)(i) and 7.03(b)(ii) above.
The sum of amounts calculated pursuant to 7.03(b)(i) and 7.03(b)(ii), adjusted
as provided under 7.03(b)(iii) and 7.03(b)(iv), shall constitute the UK Transfer
Amount. Transfer of the UK Transfer Amount shall be conditioned upon receipt of,
and subject to, all requisite trustee, governmental and other approvals and
consents and, if a different UK Transfer Amount is required by applicable
regulatory and fiduciary authorities, an adjustment to the UK Transfer Amount
will be made. Upon completion of the transfer of such assets and liabilities,
the Energizer/▇▇▇▇▇▇▇ UK Pension Plan and the Energizer Group shall have no
further liability for pension benefits for the ▇▇▇▇▇▇▇ Individuals. The parties
may by mutual agreement, subject to approval of applicable regulatory and
fiduciary authorities, effect such transfer in one or more installments, taking
into consideration the effect of an initial transfer of assets on the
continuation of benefit accruals by the ▇▇▇▇▇▇▇ Individuals in the
Energizer/▇▇▇▇▇▇▇ UK Pension Plan.
(c) Other Foreign Funded Retirement Plans. With respect to other
foreign funded retirement Plans in which the sole participants are either
Energizer Individuals or ▇▇▇▇▇▇▇ Individuals, Energizer and ▇▇▇▇▇▇▇ shall
cooperate in taking such actions as are necessary or desirable to ensure that
each such Plan in which assets funding pension benefits for such Energizer or
▇▇▇▇▇▇▇ Individuals are held is transferred to, or retained by, a member of the
Energizer Group or ▇▇▇▇▇▇▇ Group, as appropriate, and that the members of the
other Group shall have no liability related to such pension Plan thereafter.
7.04 Savings Investment Plan.
-------------------------
(a) Effective as of the Distribution Date, Energizer and its Affiliates
shall cease to be co-sponsors of the ▇▇▇▇▇▇▇ Purina Company Savings Investment
Plan ("▇▇▇▇▇▇▇ SIP"). Energizer shall take, or cause to be taken, all necessary
and appropriate actions to establish, effective as of the Distribution Date, and
administer a defined contribution Plan which will be a Qualified Plan and which
will also be subject to Section 401(k) of the Code ("Energizer SIP"), and to
provide benefits thereunder for all Energizer Individuals who, immediately prior
to the Distribution Date, were participants in the ▇▇▇▇▇▇▇ SIP. Energizer
agrees that each such Energizer Individual shall be, to the extent applicable,
entitled, for all purposes under the Energizer SIP, to be credited with the term
of service and any account balance credited to such Energizer Individual as of
the Distribution Date under the terms of the ▇▇▇▇▇▇▇ SIP as if such service had
been rendered to the Energizer Group and as if such account balance had
originally been credited to such Energizer Individual under the Energizer SIP.
▇▇▇▇▇▇▇ agrees to provide Energizer, as soon as practicable after the
Distribution Date (with the cooperation of Energizer to the extent that relevant
information is in the possession of the Energizer Group), with a list of the
Energizer Individuals who were, to the best knowledge of ▇▇▇▇▇▇▇, participants
in the ▇▇▇▇▇▇▇ SIP immediately prior to the Distribution Date, together with a
listing, if requested by Energizer, of each such Energizer Individual's term of
service for eligibility and vesting purposes under such Plan and a listing of
each such Energizer Individual's account balance thereunder. ▇▇▇▇▇▇▇ shall, as
soon as practicable after the Distribution Date, provide Energizer with such
additional information (in the possession of the ▇▇▇▇▇▇▇ Group and not already
in the possession of the Energizer Group) as may be reasonably requested by
Energizer and necessary in order for Energizer to establish and administer
effectively the Energizer SIP.
The Energizer SIP receiving transfers of accounts from the ▇▇▇▇▇▇▇ SIP shall
contain an "Energizer Stock Fund", and Energizer Individuals for whom a portion
of the account balances are to be transferred to the Energizer SIP from the
▇▇▇▇▇▇▇ SIP in the form of Energizer Stock, as described below, shall be
permitted to elect to retain their investment of that portion of their account
in the Energizer Stock Fund.
(b) ▇▇▇▇▇▇▇ shall, as soon as practicable following the Distribution
Date, direct the trustee of the ▇▇▇▇▇▇▇ Purina Company Savings Investment Trust
to transfer to the trustee of the Energizer SIP an amount equal to the account
balances credited to the Energizer Individuals as of the date of transfer. Such
transfer amount shall include cash, notes evidencing participant loans, shares
of ▇▇▇▇▇▇▇ Stock, and shares of Energizer Stock distributed with respect to
shares of ▇▇▇▇▇▇▇ Stock held in the ▇▇▇▇▇▇▇ SIP as of the Distribution, to the
extent allocated to accounts of Energizer Individuals. Such transfer shall be
consistent with and adjusted, if and to the extent necessary, to comply with
Section 414(l) of the Code and the regulations promulgated thereunder.
(c) In connection with the transfers described in Section 7.04(b),
▇▇▇▇▇▇▇ and Energizer shall cooperate in making any and all appropriate filings
required under the Code or ERISA, and the regulations thereunder, and any
applicable securities laws and take all such action as may be necessary and
appropriate to cause such transfers to take place as soon as practicable after
the Distribution Date; provided, however, that each such transfer shall not take
place until as soon as practicable after the earlier of (i) the receipt of a
favorable IRS determination letter with respect to the qualification of the
Energizer SIP under Section 401(a) of the Code or (ii) the receipt by ▇▇▇▇▇▇▇ of
an opinion of counsel retained by Energizer and reasonably satisfactory in form
and substance to ▇▇▇▇▇▇▇ to the effect that the Plan is a Qualified Plan and
that the trust established thereunder is intended to be exempt from federal
income tax under Section 501(a) of the Code. ▇▇▇▇▇▇▇ and Energizer agree to
provide to such counsel such information in the possession of the ▇▇▇▇▇▇▇ Group
and the Energizer Group, respectively, as may be reasonably requested by such
counsel in connection with the issuance of such opinion.
(d) Except as specifically set forth in this Section 7.04, upon
completion of the transfers of assets and liabilities from the ▇▇▇▇▇▇▇ SIP to
the Energizer SIP, the ▇▇▇▇▇▇▇ SIP and the ▇▇▇▇▇▇▇ Group shall have no further
liability therefor with respect to the Energizer Individuals.
7.05 U.S. Welfare Plans
--------------------
(a) Except as otherwise specifically provided herein, Energizer shall
take, or cause to be taken, all actions necessary and appropriate on behalf of
itself and the Energizer Group to adopt such Welfare Plans ("Energizer Welfare
Plans") as necessary to provide, effective as of the Distribution Date, welfare
benefits to the Energizer Individuals substantially similar to those offered to
them prior to the Distribution Date. In connection with the foregoing, ▇▇▇▇▇▇▇
agrees to provide Energizer or its designated representative with such
information (in the possession of the ▇▇▇▇▇▇▇ Group and not already in the
possession of the Energizer Group) as may be reasonably requested by Energizer
and necessary for the Energizer Group to establish any such Welfare Plan.
Energizer agrees to retain or, if Energizer or one of its Affiliates is not a
policyholder as of the Distribution Date, assume all rights and obligations,
including any Liabilities of ▇▇▇▇▇▇▇, relating to life insurance benefits under
a Metropolitan Life insurance policy for Energizer Individuals who became
disabled between July 1, 1986 and December 31, 1987 while covered under such
policy.
(b) Except as otherwise noted in this Section 7.05, Energizer shall
cause the Energizer Welfare Plans to assume, or cause one or more members of the
Energizer Group to assume, and be solely responsible for, all welfare benefit
claims paid to Energizer Individuals on or after 12:01 a.m. on the Distribution
Date. The ▇▇▇▇▇▇▇ Welfare Plans shall retain liability for welfare benefit
claims paid to Energizer Individuals under the ▇▇▇▇▇▇▇ Welfare Plans before
12:01 a.m. on the Distribution Date.
With respect to Plans providing health benefits:
(i) all checks outstanding as of the Distribution in connection with
benefits paid through First Health for Energizer Individuals shall remain the
obligation of the Purina Health Plan;
(ii) all checks outstanding as of the Distribution in connection with
benefits paid through United Health Care for Energizer Individuals shall
be the obligation of the Energizer Plan offering health benefits; and
(iii) invoices received before the Distribution Date for dental
benefits received by Energizer Individuals shall remain the obligation of
the Purina Health Plan, and invoices received on or after the Distribution Date
for dental benefits received by Energizer Individuals shall be the
obligation of the Energizer Plan offering dental benefits.
(c) As of 12:01 a.m. on the Distribution Date, Energizer shall cease to
be a sponsoring employer of the Welfare Plans sponsored by ▇▇▇▇▇▇▇. Energizer
Individuals will cease participating in Welfare Plans maintained by any member
of the ▇▇▇▇▇▇▇ Group, except for:
(i) any Energizer Individual who has timely elected or will timely
elect continued coverage under ▇▇▇▇▇▇▇'▇ health benefit Plans pursuant
to the Consolidated Omnibus Budget Reconciliation Act with respect to a
"qualifying event", as defined under such Act, that occurs on or prior to the
Distribution Date;
(ii) any Energizer Individual who elects to continue coverage under
the Partnership Life Plan as a terminated employee;
(iii) an Energizer Individual who is receiving installment disability
benefits as of the Distribution Date under the Group Life Plan;
(iv) an Energizer Individual who, under the Production Disability Plan
insured by Aetna, is receiving disability benefits as of the Distribution Date
or who after the Distribution Date is determined to be eligible to receive
benefits under the Plan because of a finding of disability that commenced
prior to the Distribution Date; and
(v) an Energizer Individual who is receiving benefits under the Long
Term Disability Plan insured by UNUM.
The parties shall cooperate in seeking and effecting the assignment to Energizer
or one of its Affiliates of all rights and obligations of ▇▇▇▇▇▇▇ under the UNUM
insurance policy described in Section 7.05(c)(v) above. In addition, the
parties agree that Energizer shall bear the cost of any Liabilities of ▇▇▇▇▇▇▇
related to or arising out of the participation, on or after the Distribution
Date, by Energizer Individuals in the insured Welfare Plans of ▇▇▇▇▇▇▇ described
in this Section 7.05(b)(iii) and (iv); and, until such time as the insurance
contract is assigned to Energizer or one of its Affiliates, Section 7.05(b)(v).
(d) Subject to paragraph (b) above, Energizer and the Energizer Group
shall retain all liabilities for retiree medical and retiree life insurance
benefits with respect to Energizer Individuals, and no Energizer Individuals
shall be entitled to retiree medical and life insurance benefits from Welfare
Plans sponsored by ▇▇▇▇▇▇▇ and the ▇▇▇▇▇▇▇ Group after the Distribution Date.
For purposes of this Section 7.05, the distribution of ownership of the
Energizer Group to shareholders of ▇▇▇▇▇▇▇ Stock shall not be deemed a
termination of employment of Energizer Employees. As of the Distribution Date,
Energizer shall adopt an Energizer Executive Health Plan and an Energizer
Executive Life Plan, and ▇▇▇▇▇▇▇ shall transfer to Energizer, and Energizer
shall assume, all liabilities for retiree benefits for Energizer Individuals who
are eligible for retiree health and life coverage under such Plans. Claims for
retiree health and life benefits paid prior to the Distribution Date with
respect to Energizer Individuals shall be treated in the manner set forth in
paragraph (b) above.
(e) ▇▇▇▇▇▇▇ and Energizer shall cooperate in causing the transfer, as
soon as practicable after the Distribution Date, of certain plan assets from the
▇▇▇▇▇▇▇ Group Life Plan and the Purina Long Term Disability Plan (collectively
the "▇▇▇▇▇▇▇ Group Life/LTD Plans") to a Voluntary Employee Benefit Association
Trust, as defined in Code Section 501(c)(9) established by Energizer (the
"Energizer VEBA"), which assets shall be used to provide life insurance benefits
and long term disability benefits to Energizer Individuals participating in the
Energizer Group Life Plan and the Energizer Long Term Disability Plan, which
shall benefit the same class or classes of Energizer Individuals that formerly
participated in the ▇▇▇▇▇▇▇ Group Life/LTD Plans. Subject to the provisions set
forth herein, ▇▇▇▇▇▇▇ shall cause the ▇▇▇▇▇▇▇ Group Life/LTD Plans, or the
Trustee of the Purina Benefit Association (the "▇▇▇▇▇▇▇ VEBA"), as applicable,
to transfer to the Energizer VEBA a pro rata share of the respective assets of
the ▇▇▇▇▇▇▇ Group Life/LTD Plans with a market value determined as of March 31,
2000, such share of assets to be calculated in the same proportion as the
present value of liabilities relating to Energizer Individuals under each such
▇▇▇▇▇▇▇ Plan (excluding liabilities retained by the ▇▇▇▇▇▇▇ Group Life Plan
relating to Energizer Individuals receiving installment disability benefits)
bears to the present value of liabilities relating to all Energizer and ▇▇▇▇▇▇▇
Individuals under each such Plan.
Notwithstanding the foregoing, the transfer of assets contemplated in this
subparagraph shall be conditioned upon (i) the receipt of either, in the sole
discretion of ▇▇▇▇▇▇▇, (A) an opinion of counsel retained by Energizer and
reasonably satisfactory in form and substance to ▇▇▇▇▇▇▇ to the effect that the
Energizer VEBA is intended to qualify under Section 501(c)(9) of the Code and
that the VEBA is intended to be exempt from taxation under Code Section 501(a);
or (B) a favorable determination letter from the IRS of the tax exempt status of
the Energizer VEBA under Code Sections 501(a) and 501(c)(9); and (ii) an
opinion of counsel retained by Energizer and reasonably satisfactory in form and
substance to ▇▇▇▇▇▇▇ to the effect that the transfer of such plan assets from
the ▇▇▇▇▇▇▇ Group Life/LTD Plans to the Energizer VEBA and the stated purpose
for the utilization of such assets is in compliance with ERISA, including but
not limited to, ERISA Section 403, and any applicable state law or regulations
relating to insurance.
(f) As of the Distribution Date, Energizer will establish a Health Care
and Dependent Care Reimbursement Plan (the "Energizer Reimbursement Plan"),
complying with Code Sections 105, 125 and 129, with terms substantially similar
to the terms of the ▇▇▇▇▇▇▇ Purina Reimbursement Accounts Plan (the "▇▇▇▇▇▇▇
Reimbursement Plan"). As of the Distribution Date, Energizer Individuals shall
cease participating in the ▇▇▇▇▇▇▇ Reimbursement Plan, and all liabilities for
benefits with respect to such Energizer Individuals under the ▇▇▇▇▇▇▇
Reimbursement Plan shall be provided under the Energizer Reimbursement Plan as
of the Distribution Date.
7.06 International Welfare Plans
-----------------------------
▇▇▇▇▇▇▇ and Energizer shall each retain all liabilities related to
international welfare plans in which only ▇▇▇▇▇▇▇ Individuals or Energizer
Individuals, respectively, are enrolled. With respect to welfare plans in which
both ▇▇▇▇▇▇▇ Individuals and Energizer Individuals are participants, ▇▇▇▇▇▇▇ and
Energizer shall cause each member of their respective Groups to cooperate with
members of the other Group to establish additional separate welfare plans as
soon as practicable after the Distribution Date in order to enroll the Energizer
Individuals and ▇▇▇▇▇▇▇ Individuals in separate plans. During the period after
the Distribution that an Energizer Individual continues to participate in a
welfare plan sponsored by a member of the ▇▇▇▇▇▇▇ Group, or vice versa, the
sponsor (or sponsor's plan, as appropriate) shall be reimbursed for the costs of
providing such coverage in excess of premiums paid by the covered Energizer or
▇▇▇▇▇▇▇ Individual. ▇▇▇▇▇▇▇ and Energizer, or their respective Welfare Plans as
applicable, shall share proportionately in any refunds of contributions or
stabilization reserves payable on account of experience prior to the
Distribution.
7.07 Internationalist Retirement Plan.
----------------------------------
As of the Distribution Date, Energizer shall assume, and be solely
responsible for, all benefits accrued with respect to Energizer Individuals
based on participation by Energizer Employees and Former Energizer Employees in
the unfunded Internationalist Retirement Plan. No ▇▇▇▇▇▇▇ Individuals are
participants in such Plan as of the Distribution Date, and ▇▇▇▇▇▇▇ shall have no
liability for payment of benefits under such Plan after the Distribution.
Energizer agrees to cause benefits accrued with respect to the Energizer
Individuals to be paid in a manner and amount consistent with the terms of the
Internationalist Retirement Plan.
7.08 Stock Options and Restricted Stock; Stock Purchase Plan.
--------------------------------------------------------------
(a) The stock options and phantom stock options held by Energizer
Individuals as of the Distribution Date shall be administered in accordance with
the terms of such agreements and the ISP under which they were granted. For
purposes of restricted stock awards and stock options, including phantom stock
options, granted under the ISPs, the Distribution shall be deemed to constitute
an involuntary termination, other than for cause, of employment of Energizer
Employees.
(b) Effective immediately after the Distribution Date, the number of
shares of ▇▇▇▇▇▇▇ Stock subject to, and the exercise price of, each
non-qualified option to acquire ▇▇▇▇▇▇▇ Stock granted pursuant to the terms of
an ISP ("▇▇▇▇▇▇▇ Option") which immediately prior to the Record Date is
outstanding and not exercised shall be adjusted in order to reflect the
difference in the fair market value of the ▇▇▇▇▇▇▇ Stock attributable to the
Distribution, in accordance with the requirements of Section 424 of the Code and
the regulations promulgated thereunder, based upon (i) the average of the
closing prices on the NYSE Composite Index for the ▇▇▇▇▇▇▇ Stock, trading
regular way with due bills for the Energizer Stock, for such period prior to the
Distribution Date as the ▇▇▇▇▇▇▇ Board determines, and (ii) the average of the
closing prices on the NYSE Composite Index for the ▇▇▇▇▇▇▇ Stock, trading
regular way, for such period following the Distribution Date as the ▇▇▇▇▇▇▇
Board determines. Outstanding phantom stock options held by certain Energizer
Individuals shall also be adjusted in a similar manner.
(c) Energizer agrees that, upon notice of the exercise of a phantom
stock option by an Energizer Individual, it shall promptly reimburse ▇▇▇▇▇▇▇ in
an amount equal to one half of the gross proceeds of the exercise payable to
such Energizer Individual.
(d) ▇▇▇▇▇▇▇ and Energizer agree that ▇▇▇▇▇▇▇, as sole shareholder of
the outstanding capital stock of Energizer, will approve the adoption by the
Board of Energizer, prior to the Distribution, of a Plan to be administered by
the Nominating and Executive Compensation Committee of the Energizer Board,
under which the Committee shall have authority to grant stock options,
restricted stock awards and other awards payable in Energizer Stock, to
directors of Energizer and eligible Energizer Employees, including executive
officers.
(e) Effective as of the Distribution Date, Energizer Employees shall
cease to be eligible to participate in the ▇▇▇▇▇▇▇ Purina Company Stock Purchase
Plan. All benefit obligations arising under the Plan prior to such date with
respect to Energizer Individuals shall be paid in accordance with the terms of
the Plan.
7.09 Unfunded Executive Deferred Compensation and Retirement Plans.
-----------------------------------------------------------------
(a) ▇▇▇▇▇▇▇ shall retain liability for all unpaid benefits, obligations
and liabilities with respect to benefits for Energizer Individuals arising from
deferrals of compensation by Energizer Employees and Former Energizer Employees
under the Fixed Benefit Option of the ▇▇▇▇▇▇▇ Purina Company Deferred
Compensation Plan for Key Employees ("▇▇▇▇▇▇▇ Deferred Compensation Plan").
(b) As of the Distribution Date, Energizer will establish a Deferred
Compensation Plan, which shall be a non-qualified unfunded deferred compensation
plan ("Energizer Deferred Compensation Plan"). Effective as of the
Distribution, ▇▇▇▇▇▇▇ shall amend the ▇▇▇▇▇▇▇ Deferred Compensation Plan to
permit the transfer to the Energizer Deferred Compensation Plan of that portion
of the ▇▇▇▇▇▇▇ Deferred Compensation Plan liabilities accrued as of March 31,
2000 with respect to Energizer Individuals under all investment Options of such
Plan other than the Fixed Benefit Option (including the company matching
accruals based on deferrals under the Equity Option), and Energizer shall cause
the Energizer Deferred Compensation Plan to accept such liabilities. In
connection therewith, ▇▇▇▇▇▇▇ shall assign to Energizer all its right, title and
obligations under the deferred compensation agreements associated with such
accrued benefits.
(c) As of the Distribution Date, Energizer will establish an Executive
Savings Investment Plan, which shall be a non-qualified unfunded deferred
compensation plan ("Energizer Executive SIP"). ▇▇▇▇▇▇▇ shall amend the ▇▇▇▇▇▇▇
Purina Executive SIP ("▇▇▇▇▇▇▇ Executive SIP") to cause the transfer to the
Energizer Executive SIP of that portion of the liabilities of the ▇▇▇▇▇▇▇
Executive SIP relating to the benefits accrued as of March 31, 2000 by the
Energizer Individuals, and Energizer shall cause the Energizer Executive SIP to
accept such liabilities.
(d) As of the Distribution Date, Energizer will establish a Supple-
mental Retirement Plan, which shall be a non-qualified unfunded supplemental
retirement plan ("Energizer SERP"). ▇▇▇▇▇▇▇ shall amend the ▇▇▇▇▇▇▇ Purina
Supplemental Retirement Plan ("▇▇▇▇▇▇▇ SERP") to cause the transfer to the
Energizer SERP of that portion of the liabilities of the ▇▇▇▇▇▇▇ SERP
relating to the benefits accrued as of March 31, 2000 by the Energizer
Individuals, and Energizer shall cause the Energizer SERP to accept such
liabilities. Accrued liabilities under the ▇▇▇▇▇▇▇ SERP shall be deemed to
include, but not be limited to, liabilities arising out of Supplemental
Retirement Awards given to Energizer Employees and Former Energizer Employees.
(e) After the Distribution Date, Energizer shall be solely responsible
for the payment of all liabilities and obligations for benefits with respect to
Energizer Individuals under the Energizer Deferred Compensation Plan, the
Energizer Executive SIP and the Energizer SERP, which shall include all
liabilities and obligations transferred pursuant to 7.09(b), (c) and (d) above,
and ▇▇▇▇▇▇▇ shall have no liability with respect thereto.
7.10 Partnership Life Insurance Plan. Energizer Employees or Former
-------------------------------
Energizer Employees who, immediately prior to the Distribution Date, were
participants in or otherwise entitled to benefits under the Partnership Life
Insurance Plan, will, as of the Distribution Date, be treated as terminated
employees for purposes of such Partnership Life Insurance Plan, and will be
afforded all rights and benefits to which all terminated employees are entitled
under the terms of such Plan. ▇▇▇▇▇▇▇ will retain ownership of any individual
life insurance contracts then insuring the life of any Energizer Employee or
Former Energizer Employee in accordance with the terms of the Partnership Life
Insurance Plan.
7.11 Survivor Life Insurance Plan. Effective as of the Distribution
-------------------------------
Date, all of ▇▇▇▇▇▇▇'▇ obligations under the Survivor Life Insurance Plan
including, but not limited to, the obligation to pay any premiums on life
insurance policies subject to such Plan (the "Policies"), shall cease with
respect to the Energizer Employees who participated in the Plan immediately
prior to the Distribution Date ("Survivor Life Participants"). Promptly
following the Distribution Date, but conditioned upon its reimbursement by
Energizer of all premiums paid by ▇▇▇▇▇▇▇ with respect to such Policies, ▇▇▇▇▇▇▇
shall assign to Energizer all of its rights, interests and obligations under
each of the 1996 Split Dollar Agreements between ▇▇▇▇▇▇▇ and either a Survivor
Life Participant or, if applicable, the trustee of a trust created by a Survivor
Life Participant for the purpose of holding such Policies (the "Trustees"). In
accepting such assignment, Energizer shall agree to be bound by the terms and
provisions of such 1996 Split Dollar Agreements.
Upon reimbursement of such premiums, ▇▇▇▇▇▇▇ shall release all of its rights
under the 1996 Collateral Assignments between ▇▇▇▇▇▇▇ and the Survivor Life
Participants, or the Trustees, in accordance with their terms, vesting full
ownership rights in the Policies to the Survivor Life Participants or the
Trustees, as appropriate, subject to the 1996 Split Dollar Agreements. Energizer
shall, or shall cause the appropriate Energizer Affiliate to, adopt a
substantially identical Survivor Life Insurance Plan with respect to all
Survivor Life Participants, and shall enter into substantially identical
Collateral Assignments with the Survivor Life Participants, or the Trustees, in
accordance with such Split Dollar Agreements and such Plan effective immediately
after the Distribution Date.
7.12 Vacation Pay/Paid Time Off. Energizer and the Energizer Group
-----------------------------
will assume (or, as applicable, retain) all liability for unpaid vacation pay
and other paid time off accrued by Energizer Employees and Former Energizer
Employees prior to the Distribution Date. On and after the Distribution Date,
▇▇▇▇▇▇▇ and the ▇▇▇▇▇▇▇ Group will have no liability for vacation pay or other
paid time off for Energizer Employees and Former Energizer Employees. ▇▇▇▇▇▇▇
and the ▇▇▇▇▇▇▇ Group will retain (or, as applicable, assume) all liability for
unpaid vacation pay and other paid time off accrued by ▇▇▇▇▇▇▇ Employees and
Former ▇▇▇▇▇▇▇ Employees prior to the Distribution Date. After the Distribution
Date, Energizer and the Energizer Group will have no liability for vacation pay
or other paid time off for ▇▇▇▇▇▇▇ Employees and Former ▇▇▇▇▇▇▇ Employees.
7.13 U. S. Severance Pay.
----------------------
(a) ▇▇▇▇▇▇▇ and Energizer agree that, with respect to individuals who,
in connection with the Distribution, cease to be employees of the ▇▇▇▇▇▇▇ Group
and become employees of the Energizer Group, such cessation shall not be deemed
a severance of employment from either Group for purposes of any Plan that
provides for the payment of severance, salary continuation or similar benefits
and shall, in connection with the Distribution, if and to the extent
appropriate, obtain waivers from individuals against any such assertion.
(b) The ▇▇▇▇▇▇▇ Group shall assume and be solely responsible for all
liabilities and obligations whatsoever in connection with claims made by or on
behalf of ▇▇▇▇▇▇▇ Individuals and the Energizer Group shall assume and be solely
responsible for all liabilities and obligations whatsoever in connection with
claims made by or on behalf of Energizer Individuals in respect of severance
pay, salary continuation and similar obligations relating to the termination or
alleged termination of any such person's employment either before, to the extent
unpaid, or on or after the Distribution Date. On or prior to the Distribution
Date, Energizer shall amend its Plans relating to severance and other
termination benefits to incorporate the terms of the special severance payment
schedule in effect in ▇▇▇▇▇▇▇'▇ ▇▇▇▇▇▇▇▇▇ Pay Plan with respect to employees of
the Corporate Division of ▇▇▇▇▇▇▇ who transfer to Energizer and who are
involuntarily terminated without cause by Energizer on or prior to September 30,
2000.
7.14 International Severance Pay.
-----------------------------
(a) ▇▇▇▇▇▇▇ and Energizer agree that, with respect to individuals who,
in connection with the Distribution, cease to be employees of the ▇▇▇▇▇▇▇ Group
and become employees of the Energizer Group or vice versa, such cessation shall
not be deemed a severance of employment from either Group except to the extent
so required by the terms of any benefit plan, labor agreement, applicable law or
governmental regulation that provides for the payment of severance pay, salary
continuation, termination indemnity or similar benefits. The parties agree, if
and to the extent appropriate, to obtain waivers from individuals against any
such assertion.
(b) To the extent severance pay, salary continuation or termination
indemnity is payable with respect to an Energizer Individual or ▇▇▇▇▇▇▇
Individual, the respective Group shall assume and be solely responsible for all
liabilities and obligations whatsoever in connection with claims for such
benefits made by or on behalf of such Individuals relating to the termination or
alleged termination of any such person's employment either before, to the extent
unpaid, or on or after the Distribution Date.
7.15 Bonus Plans. Energizer and its Affiliates shall be responsible
------------
for all liabilities with respect to Energizer Employees arising under bonus
plans, programs or policies applicable to such Employees, including liabilities
related to service prior to the Distribution Date. Notwithstanding the
foregoing, ▇▇▇▇▇▇▇ shall retain liability for amounts payable to Energizer
Employees who are participants in the 1998 Leveraged Incentive Plan.
7.16 Financial Planning Program. Except for benefits that have been
----------------------------
paid by ▇▇▇▇▇▇▇ prior to the Distribution, Energizer shall be responsible for
all liabilities with respect to Energizer Individuals arising under the
Financial Planning program for executives.
7.17 Other Balance Sheet Adjustments. To the extent not otherwise
----------------------------------
provided in this Agreement, ▇▇▇▇▇▇▇ and Energizer shall take such action as is
necessary to effect an adjustment to the books of the members of the ▇▇▇▇▇▇▇
Group and the Energizer Group so that, as of the Distribution Date, the prepaid
expense balances and accrued employee liabilities with respect to any employee
liability or obligation assumed or retained as of the Distribution Date by the
▇▇▇▇▇▇▇ Group or the Energizer Group are appropriately reflected on the
consolidated balance sheets as of the Distribution Date of ▇▇▇▇▇▇▇ and
Energizer, respectively.
7.18 Preservation of Rights to Amend or Terminate Plans. Subject to
-----------------------------------------------------
the provisions of this Article VII, no provision of this Agreement, including
the agreement of ▇▇▇▇▇▇▇ or Energizer that it, or any member of the ▇▇▇▇▇▇▇
Group or the Energizer Group, will make a contribution or payment to or under
any Plan herein referred to for any period, shall be construed as a limitation
on the right of ▇▇▇▇▇▇▇ or Energizer or any member of the ▇▇▇▇▇▇▇ Group or the
Energizer Group to amend such Plan or terminate its participation therein which
▇▇▇▇▇▇▇ or Energizer or any member of the ▇▇▇▇▇▇▇ Group or the Energizer Group
would otherwise have under the terms of such Plan or otherwise, and no provision
of this Agreement shall be construed to create a right in any ▇▇▇▇▇▇▇ Individual
or Energizer Individual under a Plan which such Individual would not otherwise
have under the terms of the Plan itself.
7.19 Reimbursement. Each of the parties hereto acknowledges that the
-------------
▇▇▇▇▇▇▇ Group, on the one hand, and the Energizer Group, on the other hand, may
incur costs and expenses (including contributions to Plans and the payment of
insurance premiums) arising from or related to any of the Plans which are, as
set forth in this Agreement, the responsibility of the other party hereto.
▇▇▇▇▇▇▇ and Energizer agree that they, or the appropriate members of their
respective Groups, shall reimburse the appropriate members of the other's Group,
as soon as practicable but in any event within 30 days of receipt from the other
party of appropriate verification, for all such costs and expenses.
7.20 Further Transfers. For a period of six months following the
------------------
Distribution Date, no member of either Group shall, directly or indirectly,
without the prior written consent of a corporate officer of the other Group,
solicit or attempt to solicit any employee or officer of such other Group for
the purpose of obtaining his or her services for hire, or otherwise causing such
employee to leave employment with such other Group, and no member of either
Group, without the prior written consent of a corporate officer of the other
Group, will, for such period of six months, hire such employee or officer;
provided, however, if the employment of any officer or employee of one Group is
terminated by that Group at any time following the Distribution, a member of the
other Group may employ such person without the consent of the other Group.
Subject to the preceding paragraph in this Section 7.20, ▇▇▇▇▇▇▇ and Energizer
recognize that there may be Energizer Employees who will, after the Distribution
Date, become employed by ▇▇▇▇▇▇▇ or a ▇▇▇▇▇▇▇ Affiliate and vice versa with
respect to ▇▇▇▇▇▇▇ Employees. With respect to such employees who transfer
employment within six months of the Distribution Date directly from one Group to
the other, the assets and liabilities of either the ▇▇▇▇▇▇▇ Retirement Plan or
the Energizer Retirement Plan, as applicable, associated with benefits accrued,
with respect to such employee, through the date that the employee transfers to
the other Group will be transferred to the corresponding Plan for the other
Group, and the employee will be given the same service credit, for purposes of
eligibility, vesting and benefit accrual, for service that the employee had
under the transferring Group's Plan. In addition, the transferring Group shall
also, as soon as practicable, transfer such employee's account balance held in
either the ▇▇▇▇▇▇▇ SIP or the Energizer SIP, as applicable, to the corresponding
SIP for the other Group, and the employee will be given the same service credit,
for purposes of eligibility and vesting, that the employee had under the
transferring Group's SIP.
7.21 Other Liabilities. Subject to the provisions of Article Four, as
------------------
of the Distribution Date, Energizer and ▇▇▇▇▇▇▇ shall each assume and be solely
responsible for all Liabilities whatsoever with respect to claims made by, in
the case of Energizer, Energizer Individuals and, in the case of ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ Individuals, relating to any Liability not otherwise expressly provided
for in this Agreement, including, but not limited to, earned salaries, wages,
severance payments, bonus accruals or other compensation, regardless of whether
such Liability was incurred before or after the Distribution Date.
7.22 Compliance. Notwithstanding anything to the contrary in this
----------
Article VII, to the extent any actions of the parties contemplated in this
Article are determined prior to the Distribution to violate law or result in
unintended tax liability for ▇▇▇▇▇▇▇ Individuals or Energizer Individuals, such
action may be modified by mutual consent of the parties hereto to avoid such
violation of law or unintended tax liability.
7.23 Agreement of Parties. Notwithstanding anything herein to the
----------------------
contrary, the agreements contained in this Article VII shall be binding only as
between the parties to this Agreement, no ▇▇▇▇▇▇▇ Individual or Energizer
Individual or other Person shall have any right with respect to any such
agreement, and no Person other than the parties to this Agreement shall have any
rights to enforce any provision hereof.
ARTICLE VIII
POST-DISTRIBUTION OBLIGATIONS
8.01 Energizer's Post-Distribution Obligations.
-------------------------------------------
(a) Energizer shall, and shall cause each member of the Energizer Group
to, comply with each representation and statement made, or to be made, to the
IRS in connection with any ruling obtained, or to be obtained, by ▇▇▇▇▇▇▇ from
the IRS with respect to any transaction contemplated by this Agreement. Neither
Energizer nor any member of the Energizer Group shall, for a period, following
the Distribution Date, of thirty months with respect to transactions described
in subparagraphs (b)(i), (iii), (iv), (v) and (vi) below; and of twenty-four
months with respect to the transaction described in subparagraph (b)(ii) below,
engage in any of the following transactions, unless, in the sole discretion of
▇▇▇▇▇▇▇, either
(i) an opinion in form and substance satisfactory to ▇▇▇▇▇▇▇ is obtained
from counsel to Energizer, the selection of which counsel is agreed to by Ral-
ston; or
(ii) a supplemental ruling is obtained from the IRS;
in either case to the effect that such transactions would not adversely affect
the tax consequences of the transactions described in Articles II and III of
this Agreement to ▇▇▇▇▇▇▇ or any member of the ▇▇▇▇▇▇▇ Group; Energizer or any
member of the Energizer Group; or the ▇▇▇▇▇▇▇ shareholders.
(b) The transactions subject to this provision are:
(i) making a material disposition (including transfers from one member
of the Energizer Group to another member of the Energizer Group), by means of a
sale or exchange of assets or capital stock, a distribution to share-
holders, or otherwise, of any of its assets (other than the transactions
contemplated by this Agreement) except in the ordinary course of
business;
(ii) repurchasing any Energizer Stock, unless such repurchase satis-
fies the requirements of Section 4.05(1)(b) of Revenue Procedure 96-30 or any
successor Revenue Procedure;
(iii) issuing capital stock of Energizer (or a successor to Energizer), whe-
ther incident to a stock offering, an acquisition transaction or otherwise, or
participating in a transaction in which shareholders of Energizer (or a
successor to Energizer) exchange or otherwise dispose of their stock in
Energizer (or a successor to Energizer), if the aggregate amount of shares
issued or disposed of in any such transactions represents a "fifty percent (50%)
or greater interest" in the total issued and outstanding stock of Energizer (or
a successor to Energizer) within the meaning of Section 355(d)(4) of the Code;
provided that Energizer further agrees to notify ▇▇▇▇▇▇▇ in advance of any such
transactions that would result in the issuance or disposition of an aggregate
amount of shares representing a ten percent (10%) or greater interest in the
total issued and outstanding stock of Energizer;
(iv) liquidating or merging with any other corporation (including a mem-
ber of the Energizer Group);
(v) ceasing to engage in the active conduct of a trade or business within
the meaning of Section 355(b)(2) of the Code; or
(vi) any other transaction, action or event which is, in any material re-
spect, inconsistent with any of the representations or statements set forth on
Schedule 8.01(b)(vi).
Energizer hereby represents that neither Energizer nor any member of the
Energizer Group has any present intention to undertake any of the transactions
set forth above, except as set forth in the ruling request submitted to the IRS
with respect to the Distribution.
8.02 ▇▇▇▇▇▇▇'▇ Post-Distribution Obligations. ▇▇▇▇▇▇▇ shall, and shall
----------------------------------------
cause each member of the ▇▇▇▇▇▇▇ Group to, refrain from taking any action which
would adversely impact any ruling obtained, or to be obtained, by ▇▇▇▇▇▇▇ from
the IRS with respect to any transaction contemplated by this Agreement.
8.03 Indemnification of Shareholders. In the event that ▇▇▇▇▇▇▇ or
---------------------------------
Energizer breaches or violates any covenant made in this Article VIII, the
breaching party shall indemnify and hold harmless:
(i) all shareholders of ▇▇▇▇▇▇▇ as of the Record Date, and
(ii) if the breaching party is Energizer, ▇▇▇▇▇▇▇,
against and in respect of any and all costs, expenses, deficiencies, litigation,
proceedings, taxes, levies, assessments, attorneys' fees, damages or judgments
of any kind or nature whatsoever, related to, arising from, or associated with
such breach or violation.
ARTICLE IX
NO REPRESENTATIONS OR WARRANTIES; EXCEPTIONS
Energizer understands and agrees that, except as set forth in Article VIII,
no member of the ▇▇▇▇▇▇▇ Group is, in this Agreement or in any Ancillary
Agreement or other agreement or document, implicitly or explicitly representing
or warranting to Energizer in any way as to the Energizer Assets, the Battery
Business or the Liabilities of the Energizer Group or as to any consents or
approvals required in connection with the consummation of the transactions
contemplated by this Agreement, it being agreed and understood that the
Energizer Group shall take all of the Energizer Assets "as is, where is" and
that, except as provided in Section 2.04, the Energizer Group shall bear the
economic and legal risk that conveyances of the Energizer Assets shall prove to
be insufficient or that the title of any member of the Energizer Group to any
Energizer Assets shall be other than good and marketable and free from
encumbrances.
ARTICLE X
GUARANTEES AND SURETY BONDS OF ▇▇▇▇▇▇▇
Energizer agrees that, as soon as practicable following the Distribution
Date, it will substitute surety bonds obtained by it for each of the surety
bonds of any member of the ▇▇▇▇▇▇▇ Group, if any, relating to any Energizer
Asset, the Battery Business or any Liability assumed by Energizer or its
Subsidiaries or Affiliates hereunder. Energizer agrees that it shall enter
indemnification agreements in its name with each provider of a surety bond
obtained with respect to the Energizer Assets, the Battery Business or any
Liability assumed by Energizer. Energizer shall use its best efforts to obtain
the complete release and discharge of any member of the ▇▇▇▇▇▇▇ Group from all
obligations (including any obligations upon any renewal or extension) related to
the Energizer Assets, the Battery Business or any Liability assumed by Energizer
on which any member of the ▇▇▇▇▇▇▇ Group is directly or contingently obligated
as a guarantor or assignor or otherwise contingently liable (including, without
limitation, any letter of credit) (the " Energizer Obligations").
In the event that Energizer is unable to obtain any such release, Energizer
agrees that
(a) it shall not extend the term or otherwise modify any such Energizer
Obligation in a manner which would expand ▇▇▇▇▇▇▇'▇ financial exposure under
such Energizer Obligation,
(b) it shall use its best efforts to substitute itself or another
member of the Energizer Group as primary guarantor of such Energizer Obli-
gations, and
(c) Energizer or any member of the Energizer Group shall not assign any
such Energizer Obligation or directly or indirectly transfer, sell or
assign any assets securing such Energizer Obligation or comprising all or any
substantial portion of a project, the financing of which gave rise to
such Energizer Obligation, including, but not limited to, the transfer, sale
or assignment of the capital stock of any Affiliate holding title to such
assets, unless ▇▇▇▇▇▇▇ or the appropriate member of the ▇▇▇▇▇▇▇ Group, as the
case may be, is released and discharged of all liabilities with respect to
such Energizer Obligation.
Without limiting any other obligation of indemnification under this Agreement or
any agreement described herein, Energizer shall defend, indemnify and hold
harmless each member of the ▇▇▇▇▇▇▇ Group and their respective Affiliates,
Subsidiaries, directors, officers and employees against any and all Liabilities
whatsoever incurred or suffered by any of them as a result of any Energizer
Obligation.
ARTICLE XI
NEGOTIATION
If any question shall arise in regard to (i) the interpretation of any
provision of this Agreement or, except to the extent provided otherwise therein,
any Ancillary Agreement, or (ii) the rights or obligations of either Group
hereunder or thereunder, each Group shall designate a senior executive within
its organization who shall, within thirty days after such question arises, meet
with the designated executive of the other Group to negotiate and attempt to
resolve such question in good faith. Such senior executives may, if they so
desire, consult outside advisors for assistance in arriving at such a
resolution. In the event that a resolution is not achieved within sixty days
following such initial meeting, then the parties may seek other legal means of
resolving such question, including but not limited to mediation or binding or
non-binding arbitration.
ARTICLE XII
MISCELLANEOUS
12.01 Conditions to the Distribution.
---------------------------------
(a) The obligation of ▇▇▇▇▇▇▇ to make the Distribution is subject to
the satisfaction of each of the following conditions:
(i) The transactions contemplated by Article II shall have been
consummated in all material respects;
(ii) ▇▇▇▇▇▇▇ shall have received rulings from the IRS, in form and
substance satisfactory to ▇▇▇▇▇▇▇'▇ tax counsel and independent auditors, that
the contributions, transfers, assumptions, mergers and Distribution described in
Articles II and III of this Agreement will not be subject to federal income
taxation at the corporate or shareholder level;
(iii) The Energizer Stock and associated Rights shall have been approved
for listing on the NYSE, subject to official notice of issuance;
(iv) The Form 10 shall have been filed with the SEC and shall have become
effective, and no stop order with respect thereto shall be in effect;
(v) All authorizations, consents, approvals and clearances of all federal,
state, local and foreign governmental agencies required to permit the valid
consummation by the parties hereto of the transactions contemplated by this
Agreement shall have been obtained; and no such authorization, consent, approval
or clearance shall contain any conditions which would have a material adverse
effect on (A) the ▇▇▇▇▇▇▇ Business or the Battery Business, (B) the Assets,
results of operations or financial condition of the ▇▇▇▇▇▇▇ Group or the
Energizer Group, in each case taken as a whole, or (C) the ability of ▇▇▇▇▇▇▇ or
Energizer to perform its obligations under this Agreement; and all statutory
requirements for such valid consummation shall have been fulfilled;
(vi) ▇▇▇▇▇▇▇ shall have provided the NYSE with the prior written notice of
the Record Date required by Rule 10b-17 of the Exchange Act and the rules and
regulations of the NYSE;
(vii) No preliminary or permanent injunction or other order, decree or
ruling issued by a court of competent jurisdiction or by a government,
regulatory or administrative agency or commission, and no statute, rule,
regulation or executive order promulgated or enacted by any governmental
authority, shall be in effect preventing the payment of the Distribution;
(viii) The Distribution shall be payable in accordance with applicable
law;
(ix) All necessary consents, waivers or amendments to each bank credit
agreement, debt security or other financing facility to which any member of the
▇▇▇▇▇▇▇ Group or the Energizer Group is a party or by which any such member is
bound shall have been obtained, or each such agreement, security or facility
shall have been refinanced, in each case on terms satisfactory to ▇▇▇▇▇▇▇ and
Energizer and to the extent necessary to permit the Distribution to be
consummated without any material breach of the terms of such agreement, security
or facility; and
(x) One or more members of the Energizer Group shall have been
substituted, as of the Distribution Date in respect of all ▇▇▇▇▇▇▇ Group debt
obligations assumed by Energizer or another member of the Energizer Group
pursuant to this Agreement.
(b) Any determination made by the ▇▇▇▇▇▇▇ Board in good faith
concerning the satisfaction or waiver of any or all of the conditions set forth
in Section 12.01(a) shall be conclusive.
12.02 Survival of Agreements. All covenants and agreements of the
------------------------
parties hereto contained in this Agreement shall survive the Distribution Date.
12.03 Entire Agreement. This Agreement, the Exhibits and Schedules
-----------------
hereto and the Ancillary Agreements shall constitute the entire agreement
between the parties hereto with respect to the subject matter hereof superseding
all previous negotiations, commitments and writings with respect to such subject
matter. To the extent that the provisions of this Agreement are inconsistent
with the provisions of any Ancillary Agreement, the provisions of such Ancillary
Agreement shall prevail.
12.04 Expenses of the Distribution. Except as otherwise provided in
-------------------------------
this Agreement and the Ancillary Agreements, after the Distribution, ▇▇▇▇▇▇▇
shall remain obligated to pay the following costs and expenses:
(a) costs and expenses (including attorneys' and accountants' fees, legal
costs and expenses) associated with the registration of shares of Energizer's
common stock in connection with the Distribution;
(b) costs of paying shareholders cash in lieu of fractional shares, as
set forth in Section 3.03;
(c) costs and expenses (including attorneys' and accountants' fees, legal
costs and expenses) associated with effecting the restructuring transactions,
as set forth in Section 2.01;
(d) costs and expenses (including attorneys' and accountants' fees, legal
costs and expenses) related to the transfer of Energizer Assets, as set
forth in Section 2.04(a);
(e) costs and expenses incurred in connection with the establishment
of the Energizer SIP and the registration of Energizer Stock to be offered
under the Energizer SIP;
(f) reasonable fees and expenses (including attorneys' and accountants'
fees, legal costs, underwriting fees and expenses) related to Energizer's
establishment of a $175 million private placement of unsecured notes; ▇▇▇▇▇▇▇'▇
and Energizer's establishment of a $450 million bank syndication credit
facility; and Energizer's establishment of a $200 million credit facility for
the purpose of selling, on a revolving basis, undivided ownership interest in
accounts receivable of the Energizer Group. In no event, however, shall ▇▇▇▇▇▇▇
be responsible for any fees, including underwriting fees, costs and expenses,
related to the drawdown of funds under any of the foregoing except the initial
drawdown of funds by ▇▇▇▇▇▇▇ under the $450 million credit facility.
12.05 GOVERNING LAW; JURISDICTION AND VENUE. THIS AGREEMENT IS MADE
----------------------------------------
AND ENTERED INTO IN, AND SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF, THE STATE OF MISSOURI, UNITED STATES OF AMERICA,
WITHOUT REGARD TO ITS CONFLICTS OF LAW PRINCIPLES, AS TO ALL MATTERS, INCLUDING
MATTERS OF VALIDITY, CONSTRUCTION, EFFECT, PERFORMANCE AND REMEDIES UNDER THIS
AGREEMENT. ALL MATTERS RELATING TO THIS AGREEMENT SHALL, SUBJECT TO THE
PROVISIONS OF ARTICLE XI OF THIS AGREEMENT, BE ADJUDICATED EXCLUSIVELY IN THE
COURTS OF THE STATE OF MISSOURI LOCATED IN ST. LOUIS, MISSOURI, OR WITHIN THE
UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MISSOURI; AND EACH
PARTY HEREBY CONSENTS TO THE EXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS FOR
ALL SUCH MATTERS.
12.06 Notices. All notices, requests, claims, demands and other
-------
communications hereunder (collectively, "Notices") shall be in writing and shall
be given (and shall be deemed to have been duly given upon receipt) by delivery
in person, by cable, telegram, telex, facsimile or other standard form of
telecommunications, or by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
If to a member of the ▇▇▇▇▇▇▇ Group:
▇▇▇▇▇▇▇ Purina Company
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
If to a member of the Energizer Group:
Energizer Holdings, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
or to such other address as either Group may have furnished to the other Group
by a notice in writing in accordance with this Section 12.06.
12.07 Amendment and Modification; Non-Waiver. This Agreement may be
-----------------------------------------
amended, modified or supplemented, or rights, powers or options hereunder waived
or impaired, only by a written agreement signed by a corporate officer of
▇▇▇▇▇▇▇ and Energizer and attested by their respective corporate secretaries.
Neither party shall be deemed to have waived or impaired any right, power or
option created or reserved by this Agreement (including without limitation, each
party's right to demand compliance with every term herein, or to declare any
breach a default and exercise its rights in accordance with the terms hereof) by
virtue of:
(a) any custom or practice of the parties at variance with the terms
hereof;
(b) any failure, refusal or neglect to exercise any right hereunder, or
to insist upon compliance with any term;
(c) any waiver, forbearance, delay, failure or omission to exercise any
right or option, whether of the same, similar or different natures, under this
Agreement or in any other circumstances; or
(d) the acceptance by either party of any payment or other
consideration from the other following any breach of this Agreement.
The rights and remedies set forth in this Agreement are in addition to any other
rights or remedies which may be granted by law.
12.08 Successors and Assigns; No Third-Party Beneficiaries. This
---------------------------------------------------------
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of each Group and their respective successors and permitted assigns,
but neither this Agreement nor any of the rights, interests and obligations
hereunder shall be assigned by either Group without the prior written consent of
the other Group (which consent shall not be unreasonably withheld). Except for
the provisions of Sections 4.02 and 4.03 relating to Indemnities, which are also
for the benefit of the Indemnitees, this Agreement is solely for the benefit of
each Group and is not intended to confer upon any other Person any rights or
remedies hereunder.
12.09 Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
12.10 Interpretation.
--------------
(a) The Article and Section headings contained in this Agreement are
solely for the purpose of reference, are not part of the agreement of the
parties hereto and shall not in any way affect the meaning or interpretation of
this Agreement.
(b) The parties hereto intend that, for federal income tax purposes,
the contributions, transfers, assumptions, Distribution and Merger contemplated
hereby shall qualify for non-recognition treatment under Sections 332, 336, 337,
355, 357(a), 361, 368(a)(1)(D) and 1032 of the Code.
12.11 Legal Enforceability. Any provision of this Agreement or any of
---------------------
the Ancillary Agreements which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any such prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any other
jurisdiction. Each party acknowledges that money damages would be an inadequate
remedy for any breach of the provisions of this Agreement or any of the
Ancillary Agreements and agrees that the obligations of the parties hereunder
and thereunder shall be specifically enforceable.
12.12 References; Construction. References to any "Article",
-------------------------
"Exhibit", "Schedule" or "Section", without more, are to Articles, Exhibits,
Schedules and Sections to or of this Agreement. Unless otherwise expressly
stated, clauses beginning with the term "including" set forth examples only and
in no way limit the generality of the matters thus exemplified.
12.13 Termination. Notwithstanding any provision hereof, this
-----------
Agreement may be terminated and the Distribution abandoned at any time prior to
the Distribution Date by and in the sole discretion of the ▇▇▇▇▇▇▇ Board without
the approval of any other party hereto or of ▇▇▇▇▇▇▇'▇ shareholders. In the
event of such termination, no party hereto shall have any Liability to any
Person by reason of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
ENERGIZER HOLDINGS, INC. ▇▇▇▇▇▇▇ PURINA COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President and General Vice President and Chief
Counsel Financial Officer
Index of Schedules and Exhibits to Agreement and Plan of Reorganization.
Exhibit A Tax Sharing Agreement
Exhibit B Bridging Services Agreement
Exhibit C Intellectual Property Agreement
Schedule 1.01 (a) Included in Energizer Assets
Schedule 1.01 (b) Excluded from Energizer Assets
Schedule 1.01 (c) ▇▇▇▇▇▇▇ Assets
Schedule 2.04(b)(1) Shared Liabilities - Energizer and ▇▇▇▇▇▇▇
Schedule 2.04(b)(2) Energizer Assumed Liabilities
Schedule 2.04(b)(3) ▇▇▇▇▇▇▇ Assumed Liabilities
Schedule 2.07 Charitable Trust Fund Pledge Commitments
Schedule 5.04(b)(1) Exclusion from Energizer Bank Accounts
Schedule 8.01(b)(vi) Post Spin-off Obligations of Energizer
EXHIBIT A
TAX SHARING AGREEMENT
-----------------------
BETWEEN
-------
▇▇▇▇▇▇▇ PURINA COMPANY
----------------------
AND
---
ENERGIZER HOLDINGS, INC.
------------------------
THIS AGREEMENT (the "Agreement") dated as of April 1, 2000 is made by and
between ▇▇▇▇▇▇▇ PURINA COMPANY ("▇▇▇▇▇▇▇"), a corporation organized under the
laws of the State of Missouri, and ENERGIZER HOLDINGS, INC. ("Energizer"), a
corporation organized under the laws of the State of Missouri.
WHEREAS, ▇▇▇▇▇▇▇ is the common parent of an affiliated group of domestic
corporations within the meaning of Section 1504(a) of the U. S. Internal Revenue
Code of 1986, as amended (the "Code"), which group includes Energizer (such
corporations hereinafter referred to collectively as the "▇▇▇▇▇▇▇ Domestic
Subsidiaries" and individually as a "▇▇▇▇▇▇▇ Domestic Subsidiary", and such
affiliated group shall be referred to as the "▇▇▇▇▇▇▇ Group");
WHEREAS, ▇▇▇▇▇▇▇ is also the parent of certain directly or indirectly owned
foreign corporations (such corporations hereinafter referred to collectively as
the "▇▇▇▇▇▇▇ Foreign Affiliates", and individually as a "▇▇▇▇▇▇▇ Foreign
Affiliate"), as more specifically defined below.
WHEREAS, on or before April 1, 2000, Energizer will become the common
parent of an affiliated group of domestic corporations within the meaning of
Code Section 1504(a) (such corporations hereinafter referred to collectively as
the "Energizer Domestic Subsidiaries" and individually as a "Energizer Domestic
Subsidiary", and such affiliated group shall be referred to as the "Energizer
Group");
WHEREAS, on or before April 1, 2000, Energizer will also become the parent
of certain directly or indirectly owned foreign corporations (such corporations
hereinafter referred to collectively as the "Energizer Foreign Affiliates" and
individually as the "Energizer Foreign Affiliate"), as more specifically defined
below.
WHEREAS, ▇▇▇▇▇▇▇ intends to distribute to its shareholders all of its stock
in Energizer (the "Distribution") in accordance with the terms and conditions of
the Agreement and Plan of Reorganization between ▇▇▇▇▇▇▇ and Energizer dated as
of April 1, 2000 (the "Plan of Reorganization") on April 1, 2000 (the
"Distribution Date") in accordance with a favorable ruling from the Internal
Revenue Service ("IRS") dated February 4, 2000 that the Distribution qualifies
as a nontaxable distribution of stock of a controlled corporation under Code
Section 355; and that certain ancillary transactions also qualify as nontaxable
under Code Section 355, 368(a)(1)(D), 332, 351 and 367; and,
WHEREAS, ▇▇▇▇▇▇▇ and Energizer believe that it is in their mutual best
interests to set forth in this Agreement the rights, obligations and duties of
each party with respect to various tax matters relating to the Energizer Group,
the ▇▇▇▇▇▇▇ Group, the ▇▇▇▇▇▇▇ Foreign Affiliates and the Energizer Foreign
Affiliates which may arise as a result of the Distribution.
NOW, THEREFORE, in consideration of the premises and of the agreements
herein set forth, ▇▇▇▇▇▇▇, (on its own behalf and on behalf of the ▇▇▇▇▇▇▇
Domestic Subsidiaries and the ▇▇▇▇▇▇▇ Foreign Affiliates) and Energizer (on its
own behalf and on behalf of the Energizer Domestic Subsidiaries and the
Energizer Foreign Affiliates), hereby agree as follows:
ARTICLE I. DEFINITIONS
For purposes of the provisions set forth in this Agreement,
(a) The term "Audit(s)" shall mean any audit or examination undertaken
by a Tax authority with respect to Taxes.
(b) The term "Battery Business" shall have the same meaning as the term
is given in the Plan of Reorganization.
(c) The term "Controversy(ies)" shall mean any action involving a Tax
authority before any administrative or judicial body which results from a
disagreed Tax adjustment proposed during the course of an Audit.
(d) The term "Domestic" as used herein to modify the terms "Tax",
"Taxes" or "Return", shall mean with respect to any U.S. federal, territorial,
state or local government.
(e) The terms "Energizer Employee" or "Former Energizer Employee" shall
have the same meaning as such term is given in the Plan of Reorganization.
(f) The term "Energizer Foreign Affiliate" shall mean any entity which
on or after the Distribution Date is owned directly or indirectly (or, pur-
suant to the Agreement and Plan of Reorganization, is owned beneficially)
by Energizer, and is formed under the laws of a government other than the
United States, its states or territories.
(g) The term "Foreign" as used herein to modify the terms "Tax",
"Taxes" or "Return", shall mean with respect to any government which is
not an U.S. federal, territorial, state or local government.
(h) The term "Former Battery Business" shall have the same meaning as
the term is given in the Plan of Reorganization.
(i) The term "Former ▇▇▇▇▇▇▇ Business" shall have the same meaning as
the term is given in the Plan of Reorganization.
(j) The term "Joint Foreign Affiliate" shall mean any Foreign entity
that currently or formerly conducted a ▇▇▇▇▇▇▇ Business or a Former ▇▇▇▇▇▇▇
Business and a Battery Business or a Former Battery Business, provided, however,
that, for purposes of this Agreement, after the Distribution Date any such Joint
Foreign Affiliate shall thereinafter be treated as a ▇▇▇▇▇▇▇ Foreign Affiliate
or Energizer Foreign Affiliate, as the case may be.
(k) The term "▇▇▇▇▇▇▇ Business" shall have the same meaning as the term
is given in the Plan of Reorganization.
(l) The term "▇▇▇▇▇▇▇ Employee" shall have the same meaning as the term
is given in the Plan of Reorganization.
(m) The term "▇▇▇▇▇▇▇ Foreign Affiliate" shall mean any entity which on
or after the Distribution Date is owned directly or indirectly (or, pursuant to
the Agreement and Plan of Reorganization, is owned beneficially) by ▇▇▇▇▇▇▇, is
formed under the laws of a government other than the United States, its states
or territories, and is not an Energizer Foreign Affiliate.
(n) Tax or Taxes. As used herein, "Tax" or "Taxes" shall mean any and
-------------
all taxes, charges, fees, levies or other assessments, however denominated,
including any interest, penalties, fines, or other additions that may become
payable in respect thereof, that are imposed, by any governmental entity,
whether foreign or domestic, federal, territorial, state or local, or any agency
or political subdivision of any such governmental entity; including, but not
limited to, all income, profits, gross receipts, earnings, net worth, payroll,
withholding, unemployment insurance, Social Security, Medicare Hi, sales, use,
ad valorem, excise, franchise, license, occupation, real or personal property,
stamp, transfer, value-added, recording, registration, other governmental
charges, and other government obligations of the same or of a similar nature to
any of the foregoing, which any member of the ▇▇▇▇▇▇▇ Group or Energizer Group,
or any ▇▇▇▇▇▇▇ Foreign Affiliate or Energizer Foreign Affiliate, is required to
pay, withhold or collect. With respect to Foreign Taxes allocated between or
among the ▇▇▇▇▇▇▇ Business, the Battery Business, any Former ▇▇▇▇▇▇▇ Business,
or any Former Battery Business currently or formerly conducted by a Joint
Foreign Affiliate, Taxes shall mean the Taxes that would have been imposed had
the Battery Business or Former Battery Business been the sole business of a
single Foreign Affiliate, in accordance with Article III 1(b)(i) and (ii)
hereof.
(o) The term "Tax Return" or "Return" shall mean any return, filing,
questionnaire, information report or other document required to be filed,
including without limitation any amended returns, any documents with respect to
or accompanying payments of estimated Taxes, that may be filed, for any Tax
period with any Tax authority (domestic or foreign) in connection with any Tax
or Taxes (whether or not payment is required to be made with respect to such
filing). As used herein, "Consolidated Tax Return" shall mean a U.S. federal
income Tax Return described in Code Section 1501.
Any other capitalized terms not defined herein shall have the same meaning as in
the Agreement and Plan of Reorganization.
ARTICLE II. DOMESTIC TAXES
1. Domestic taxes - Preparation and Filing of Tax Returns, Payment of Taxes,
-------------------------------------------------------------------------
Adjustments, Audits and Controversies.
----------------------------------------
(a) Preparation and Filing of Domestic Returns.
-----------------------------------------------
(i) The preparation and filing of any Domestic Tax Return for Energi-
zer or the Energizer Domestic Subsidiaries for any Tax period ending prior
to the Distribution Date shall be the responsibility of ▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇
shall consistently prepare and file such Domestic Tax Returns in accordance
with its historical practices. To the extent practicable, ▇▇▇▇▇▇▇ shall permit
Energizer to review and comment on, prior to filing, any such Domestic
Tax Return.
(ii) Energizer hereby designates and Energizer agrees to cause each
of the Energizer Domestic Subsidiaries to designate ▇▇▇▇▇▇▇ irrevocably as its
agent for the purpose of taking any and all action necessary or incidental
to the filing of any Consolidated Return or any other Domestic Tax Return, as
necessary for any Tax period ending prior to the Distribution Date.
(iii) The preparation and filing of any Domestic Tax Return for
Energizer or the Energizer Domestic Subsidiaries for any Tax period
beginning on or after the Distribution Date shall be the responsibility
of Energizer. In addition, Energizer shall be responsible for the preparation
and filing of any Energizer Domestic Subsidiary Domestic Tax Return for Tax
periods beginning before and ending after the Distribution Date. For purposes
of the preceding sentence, and to the extent practicable, Energizer shall
permit ▇▇▇▇▇▇▇ to review and comment on, prior to filing, any such
Domestic Tax Return.
(b) Liability for Domestic Taxes.
-------------------------------
(i) Pre-Distribution Date. ▇▇▇▇▇▇▇ shall be liable for, shall indemnify and
---------------------
hold the Energizer Group harmless against, and shall make payment of any
Domestic Tax which is attributable to the Energizer Group, for any and all Tax
periods (or portions of periods) ending prior to the Distribution Date and that
portion of any Tax period straddling the Distribution Date that ends on the day
before the Distribution Date, including any such liabilities resulting from the
Audit or other adjustment to previously filed Domestic Tax Returns with respect
to any such Tax period (or portion thereof). Subject to subparagraph (iii)
hereof, ▇▇▇▇▇▇▇ shall be entitled to any and all refunds of such Domestic Taxes
for any such Tax period, including but not limited to refunds described in
subparagraph (v) hereof. For purposes of this subparagraph (b), ▇▇▇▇▇▇▇ will be
credited for any estimated Domestic Tax payments made for such Tax periods.
(ii) Post-Distribution Date. Energizer shall be liable for, shall indemnify
----------------------
and hold the ▇▇▇▇▇▇▇ Group harmless against, and make payment of any
Domestic Tax due which is attributable to the Energizer Group for all Tax
periods beginning on or after the Distribution Date and that portion of any Tax
period straddling the Distribution Date that begins on the Distribution Date and
shall be entitled to any and all refunds of such Domestic Taxes for that portion
of any such Tax period.
(iii) Proration of Taxes. To the extent permitted by law or administrative
-------------------
practice, the Tax periods of the Energizer Group and each Energizer Domestic
Subsidiary shall end on the day immediately preceding the Distribution Date.
For purposes of determining the liability for Domestic Taxes of an Energizer
Subsidiary for a portion of a taxable year or period that begins before and ends
after the Distribution Date, as necessary under applicable law, the
determination of the Domestic Taxes for the portion of the year or period ending
immediately prior to, and the portion of the year or period beginning on or
after, the Distribution Date shall be determined by assuming that the taxable
year or period ended on the day immediately preceding the Distribution Date,
except that exemptions, allowances or deductions that are calculated on an
annual basis and annual property Taxes shall be prorated on the basis of the
number of days in the applicable annual period elapsed through the day
immediately preceding the Distribution Date.
(iv) Energizer's Carryback of Post-Distribution Deductions, Losses or
----------------------------------------------------------------------
Credits. If (A) Energizer or any Energizer Domestic Subsidiary, shall be
------- entitled to carry back any net operating loss, capital loss, or other
similar losses, deductions or credits derived with respect to any period begin-
ning on or after the Distribution Date to any Tax period commencing prior
to the Distribution Date, and (B) any such carry back results in a decrease in
Domestic Taxes paid by ▇▇▇▇▇▇▇ or any ▇▇▇▇▇▇▇ Domestic Subsidiary (as com-
Pared to the Taxes ▇▇▇▇▇▇▇ or such member of the ▇▇▇▇▇▇▇ Group would
otherwise have paid solely without giving effect to such carry back), an
amount equal to any such Tax refunds (plus interest) received by ▇▇▇▇▇▇▇
or the ▇▇▇▇▇▇▇ Domestic Subsidiaries as a result of such carrybacks
shall be promptly remitted to Energizer. ▇▇▇▇▇▇▇ and Energizer agree to,
and shall cause the appropriate member(s) of their respective Groups to,
cooperate with each other in order to obtain such refunds. Energizer agrees
to reimburse the members of the ▇▇▇▇▇▇▇ Group for any reasonable out-of-
pocket expenses related thereto.
(v) Energizer's Claiming, Receiving or Using Refunds and Overpayments. If
-------------------------------------------------------------------
on or after the Distribution Date, a member of the Energizer Group receives any
refund or utilizes the benefit of any overpayment of Domestic Taxes which, in
either case, relates to Domestic Taxes paid by a member of the ▇▇▇▇▇▇▇ Group
with respect to a taxable period or portion thereof ending on or prior to the
Distribution Date, then Energizer shall promptly transfer, or cause to be
transferred to ▇▇▇▇▇▇▇ an amount equal to the entire amount of the refund or
overpayment (including interest) received or utilized by the Energizer Group.
Energizer agrees to notify ▇▇▇▇▇▇▇ within thirty (30) days after the discovery
of a right to claim any such refund or overpayment and the receipt of any such
refund or utilization of any such overpayment. Energizer agrees to, or to cause
the appropriate member of the Energizer Group to, claim any such refund or
to utilize any such overpayment as soon as possible and to furnish to ▇▇▇▇▇▇▇
all information, records and assistance necessary to verify the amount of the
refund or overpayment. ▇▇▇▇▇▇▇ and Energizer agree to, and shall cause the
appropriate member(s) of their respective Groups to, cooperate with each other
in order to obtain such refunds or overpayments and ▇▇▇▇▇▇▇ agrees to reimburse
Energizer for any reasonable out-of-pocket expenses related thereto.
(vi) Tax Liabilities/Benefits Resulting from Post Distribution Stock Option
-----------------------------------------------------------------------
Exercises by Energizer Employees, Former Energizer Employees and Post
-----------------------------------------------------------------------------
Distribution Energizer Employees. Energizer shall be liable for any and all
----------------------------------
Taxes, including but not limited to, payroll, Social Security, and Medicare Hi
Taxes, imposed on an employer (the "Employer Taxes") with respect to
compensation resulting from the exercise of ▇▇▇▇▇▇▇ stock options on or after
the Distribution Date by any Energizer Employee, Former Energizer Employee or
other individual who becomes employed by a member of the Energizer Group after
the Distribution Date, if at the time of the grant of such stock option, the
recipient was an employee of the Battery Business or identified on payroll
records as an employee of the Battery Business. In the event that ▇▇▇▇▇▇▇,
acting on behalf of Energizer, pays and deposits such Employer Taxes with
respect to such compensation, then ▇▇▇▇▇▇▇ shall be entitled to reimbursement
from Energizer for such Employer Taxes, net of the tax benefit derived from any
income tax deduction to ▇▇▇▇▇▇▇ attributable to such Employer Taxes. If as a
result of such exercise of a ▇▇▇▇▇▇▇ stock option, Energizer shall be entitled
to claim on the appropriate Tax Return a corresponding income tax deduction for
the compensation expense, resulting in an actual diminution of any Domestic
Taxes, then Energizer shall pay ▇▇▇▇▇▇▇ the amount of such actual diminution of
Domestic Taxes as well as any reimbursement for Employer Taxes provided herein
within thirty (30) days after written notification of Energizer by ▇▇▇▇▇▇▇ of
such option exercise.
(vii) Tax Liabilities Resulting from Post Distribution Stock Option
--------------------------------------------------------------------
Exercises by all Other Employees. ▇▇▇▇▇▇▇ shall be liable for all Employer
------------------------------------
Taxes with respect to compensation resulting from the exercise of ▇▇▇▇▇▇▇ stock
options on or after the Distribution Date by any Energizer Employee or Former
Energizer Employee, if at the time of the award of the grant of the stock
option, the recipient was an employee of ▇▇▇▇▇▇▇ Purina Company or otherwise
employed by a ▇▇▇▇▇▇▇ Business. ▇▇▇▇▇▇▇ shall be entitled to claim on the
appropriate Tax Return a corresponding income tax deduction for the compensation
expense and related Employer Taxes paid. To the extent that ▇▇▇▇▇▇▇ is
entitled to such income tax deduction but Energizer is determined by a Tax
authority to be liable for such Employer Taxes, ▇▇▇▇▇▇▇ shall pay Energizer an
amount equal to such Employer Taxes, net of the tax benefit derived from any
income tax deduction to Energizer attributable to such Employer Taxes, within
thirty (30) days after a final determination by a court or administrative
authority that Energizer is so liable.
(viii) Tax Liabilities/Benefits Resulting from Other Deferred Compensation
---------------------------------------------------------------------
Payable Post Distribution. Energizer shall be liable with respect to any
---------------------------
Employer Taxes with respect to payments by ▇▇▇▇▇▇▇ under the Fixed Benefit
Option of the ▇▇▇▇▇▇▇ Purina Company Deferred Compensation Plan for Key
Employees ("▇▇▇▇▇▇▇ Deferred Compensation Plan") to any Energizer Employee,
Former Energizer Employee or individual who becomes employed by a member of the
Energizer Group after the Distribution Date, if at the time of the award of a
benefit under the ▇▇▇▇▇▇▇ Deferred Compensation Plan, the recipient was an
employee of the Battery Business or identified on payroll records as an employee
of the Battery Business. In the event that ▇▇▇▇▇▇▇, acting on behalf of
Energizer, pays and deposits such Employer Taxes for which Energizer is liable
under this provision with respect to such compensation, then ▇▇▇▇▇▇▇ shall be
entitled to reimbursement from Energizer for such Employer Taxes for which it is
liable under this provision, net of the tax benefit derived from any income tax
deduction to ▇▇▇▇▇▇▇ attributable to such Employer Taxes. If as a result of
such payment of compensation by ▇▇▇▇▇▇▇, Energizer shall be entitled to claim on
the appropriate Tax Return a corresponding income tax deduction for the
compensation expense, resulting in an actual diminution of any Domestic Taxes,
then Energizer shall pay ▇▇▇▇▇▇▇ the amount of such actual diminution of
Domestic Taxes as well as any reimbursement for Employer Taxes provided herein
within thirty (30) days after written notification of Energizer of such payment.
▇▇▇▇▇▇▇ shall be liable for all Employer Taxes with respect to payments
under the ▇▇▇▇▇▇▇ Deferred Compensation Plan on or after the Distribution Date
to any Energizer Employee or Former Energizer Employee, if at the time of the
award of a benefit under the ▇▇▇▇▇▇▇ Deferred Compensation Plan the recipient
was an employee of ▇▇▇▇▇▇▇ Purina Company or otherwise employed by a ▇▇▇▇▇▇▇
Business. ▇▇▇▇▇▇▇ shall be entitled to claim on the appropriate Tax Return a
corresponding income tax deduction for the compensation expense and related
Employer Taxes paid. To the extent that ▇▇▇▇▇▇▇ is entitled to such income tax
deduction but Energizer is determined by a Tax authority to be liable for such
Employer Taxes, ▇▇▇▇▇▇▇ shall pay Energizer an amount equal to such Employer
Taxes, net of the tax benefit derived from any income tax deduction to Energizer
attributable to such Employer Taxes, within thirty (30) days after a final
determination by a court or administrative authority that Energizer is so
liable.
(ix) Reimbursement of Other Tax Benefits. Energizer shall reimburse ▇▇▇▇▇▇▇
-----------------------------------
to the extent of Domestic Tax benefits derived by any member of the
Energizer Group, for payments made by ▇▇▇▇▇▇▇ to third parties on or after the
Distribution Date, which result in a tax deduction to Energizer or an Energizer
Domestic Subsidiary ("▇▇▇▇▇▇▇ Payments"), provided such ▇▇▇▇▇▇▇ Payments (a) are
not claimed as a deduction by ▇▇▇▇▇▇▇ for Domestic Tax purposes, (b) are
deductible on a Domestic Tax Return of the Energizer Group, and (c) result in a
reduction of Domestic Taxes of Energizer, the Energizer Group, or any Energizer
Domestic Subsidiary. The amount of the payment required hereunder for any
taxable period of Energizer shall be equal to the actual diminution of any
Domestic Taxes by reason of any ▇▇▇▇▇▇▇ Payments. Provided, however, if for any
taxable period, (X) Energizer or ▇▇▇▇▇▇▇ files an amended Domestic Tax Return
(or files a carryback or carryforward claim relating to a net operating loss),
or (Y) the IRS adjusts any item on any Energizer or ▇▇▇▇▇▇▇ Domestic Tax Return,
the amount of the payment required under this paragraph shall be recomputed
(either at the time of the filing of the amended return, or carryover or
carryback claim, or at the time of the final determination of the IRS
adjustment) to reflect such amended return, claim, or IRS adjustment, and, at
such time, either (I) ▇▇▇▇▇▇▇ shall repay any overpayment by Energizer under
this paragraph of this Article II.1(b)(ix) to Energizer, or (II) Energizer shall
pay any underpayment under this paragraph of this Article II.1(b)(ix) to
▇▇▇▇▇▇▇.
▇▇▇▇▇▇▇ shall reimburse Energizer to the extent of Domestic Tax benefits
derived by any member of the ▇▇▇▇▇▇▇ Group for payments made by Energizer to
third parties on or after the Distribution Date, which result in a tax deduction
to ▇▇▇▇▇▇▇ or a ▇▇▇▇▇▇▇ Domestic Subsidiary ("Energizer Payments") for any
period beginning after the Distribution Date, provided such Energizer Payments
(a) are not claimed as a deduction by Energizer for Domestic Tax purposes, (b)
are deductible on a Domestic Tax Return of the ▇▇▇▇▇▇▇ Group for any period
beginning after the Distribution Date, and (c) result in a reduction of Domestic
Taxes of ▇▇▇▇▇▇▇, the ▇▇▇▇▇▇▇ Group, or any ▇▇▇▇▇▇▇ Domestic Subsidiary. The
amount of the payment required hereunder for any taxable period of ▇▇▇▇▇▇▇ shall
be equal to the actual diminution of any Domestic Taxes by reason of any
Energizer Payments. Provided, however, if for any taxable period, (X) ▇▇▇▇▇▇▇
or Energizer files an amended Domestic Tax Return (or files a carryback or
carryforward claim relating to a net operating loss), or (Y) the IRS adjusts any
item on any ▇▇▇▇▇▇▇ or Energizer Domestic Tax Return, the amount of the payment
required under this paragraph shall be recomputed (either at the time of the
filing of the amended return, or carryover or carryback claim, or at the time of
the final determination of the IRS adjustment) to reflect such amended return,
claim, or IRS adjustment, and, at such time, either (I) Energizer shall repay
any overpayment by ▇▇▇▇▇▇▇ under this paragraph of this Article II.1(b)(ix) to
▇▇▇▇▇▇▇, or (ii) ▇▇▇▇▇▇▇ shall pay any underpayment under this paragraph of this
Article II.1(b)(ix) to Energizer.
▇▇▇▇▇▇▇ or Energizer, as the case may be, will provide, in a timely manner
(but in no event more than thirty (30) days after written request therefor),
such information as is reasonably necessary to substantiate the deduction for a
▇▇▇▇▇▇▇ Payment or an Energizer Payment, as the case may be, so as to permit
inclusion of such deduction on the appropriate Domestic Tax Return of Energizer,
the Energizer Group, or any Energizer Domestic Subsidiary or ▇▇▇▇▇▇▇, the
▇▇▇▇▇▇▇ Group, or any ▇▇▇▇▇▇▇ Domestic Subsidiary, as the case may be. At
▇▇▇▇▇▇▇'▇ or Energizer's written request, as the case may be, to the extent that
"substantial authority" (as defined in Section 6662 of the Code) exists
therefor, Energizer or ▇▇▇▇▇▇▇, as the case may be, (a) shall claim the
deduction for (and shall not report income with respect to) a ▇▇▇▇▇▇▇ Payment or
an Energizer Payment, as the case may be, on the appropriate federal, state or
local income tax return, and (b) shall contest any claim by a taxing authority
relating to the ▇▇▇▇▇▇▇ Payment or the Energizer Payment, as the case may be,
provided ▇▇▇▇▇▇▇ or Energizer, as the case may be has agreed to indemnify the
other in a manner reasonably satisfactory to Energizer or ▇▇▇▇▇▇▇, as the case
may be, for any liability or loss (including (i) interest and penalties on
Taxes, and (ii) any reasonable out-of-pocket expenses) incurred by Energizer or
▇▇▇▇▇▇▇, as the case may be, as a result of taking such return position or
pursuing such contest.
(c) Domestic Audits and Controversies.
------------------------------------
(i) ▇▇▇▇▇▇▇ shall, at its own expense, exclusively control and
direct any Tax Audit or Controversy with respect to any Domestic Taxes for any
Tax period ending prior to the Distribution Date. Energizer, however, shall
have the right, at its own expense, to participate in any such Audit or
Controversy to the extent such Audit or Controversy would impact the Domestic
Taxes for which Energizer is liable in accordance with this Agreement, as
determined by Energizer, and ▇▇▇▇▇▇▇ shall not consent to any resolution,
compromise or conclusion of such Audit or Controversy without the written
approval of Energizer, which approval shall not be unreasonably withheld.
Notwithstanding the foregoing, in the event ▇▇▇▇▇▇▇ shall compromise or settle
any such deficiency of Domestic Tax without the prior consent of Energizer,
▇▇▇▇▇▇▇ shall hold Energizer and any Energizer Domestic Subsidiary harmless
against any losses, costs, or damages, including Taxes resulting from such
compromise or settlement.
(ii) Energizer shall, at its own expense, exclusively control and
direct any Audit or Controversy with respect to any Domestic Taxes attributable
to the Energizer Group for a Tax period which begins on or after the
Distribution Date and for any Tax period straddling the Distribution Date.
▇▇▇▇▇▇▇, however, shall have the right, at its own expense, to participate in
any such Audit or Controversy to the extent such Audit or Controversy would
impact the Domestic Taxes for which ▇▇▇▇▇▇▇ is liable in accordance with this
Agreement, as determined by ▇▇▇▇▇▇▇, and Energizer shall not consent to any
resolution, compromise or conclusion of such Audit or Controversy without the
written approval of ▇▇▇▇▇▇▇, which approval shall not be unreasonably withheld.
Notwithstanding the foregoing, in the event Energizer shall compromise or settle
any such deficiency of Domestic Tax without the prior consent of ▇▇▇▇▇▇▇,
Energizer shall hold ▇▇▇▇▇▇▇ and any ▇▇▇▇▇▇▇ Domestic Subsidiary harmless
against any losses, costs, or damages, including Taxes resulting from such
compromise or settlement.
(d) Domestic Tax Adjustments.
--------------------------
(i) If the IRS, or any state or local taxing authority, shall make
an adjustment to any Domestic Tax Return of (A) the ▇▇▇▇▇▇▇ Group, (B) any
▇▇▇▇▇▇▇ Domestic Subsidiary, (C) Energizer, or (D) any Energizer Domestic
Subsidiary for any Tax period ending prior to the Distribution Date, and such
adjustment (including but not limited to adjustments to tax basis determination,
a tax accounting method with respect to its property and accounts included in
and carried forward from ▇▇▇▇▇▇▇ or the ▇▇▇▇▇▇▇ Domestic Subsidiaries prior to
the Distribution Date), consistently applied would require Energizer or the
Energizer Domestic Subsidiaries to make a corresponding adjustment to their
Domestic Tax Returns for periods beginning on or after the Distribution Date,
then,
(A) if such corresponding adjustment in a Domestic Tax Return
of Energizer or any Energizer Domestic Subsidiary results in an actual
diminution of any Domestic Taxes for any such period beginning on or after the
Distribution Date, whether or not an actual amended return is filed, Energizer
shall pay ▇▇▇▇▇▇▇ the amount of such Domestic Tax either (I) when such refund
and related interest are received and required to be remitted within the period
provided in Article VI 3 hereof, or (II) within thirty (30) days of written
notice by ▇▇▇▇▇▇▇ to Energizer of such corresponding adjustment, if an amended
return is not filed.
(B) if such corresponding adjustment in a Domestic Tax
Return of Energizeror any Energizer Domestic Subsidiary results in an increase
of any Domestic Tax for Energizer for such period beginning on or after the
Distribution Date, and an actual diminution of any Domestic Tax for
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ shall pay Energizer the amount of such Domestic Tax, either
due (I) when such refund and related interest are received and required to
be remitted within the period provided in Article VI.3 hereof, or (II)
within thirty (30) days of written notice by Energizer to ▇▇▇▇▇▇▇ of such
corresponding adjustment, if an amended return is not filed.
No payment shall be due under this Article II.1(d) to the extent that any
payment is made, or would be required to be made for the same adjustment, under
Article II.1(b)(ix) hereof.
(e) Domestic Transfer Taxes. ▇▇▇▇▇▇▇ shall pay any and all Domestic
-------------------------
Taxes required upon, or by virtue of, any transfer of property contemplated
under the Plan of Reorganization including the transfer of shares of stock of
Energizer Domestic Subsidiaries in connection with the Distribution.
(f) Domestic Tax Attributes.
-------------------------
(i) Any Domestic Tax attribute generated by ▇▇▇▇▇▇▇ or Energizer
shall, to the extent permitted by the applicable law of the Tax jurisdiction in
question, remain with ▇▇▇▇▇▇▇ or Energizer, respectively, or the appropriate
entity. In any case where the applicable law of the Tax jurisdiction in
question requires such Tax attribute to be allocated between ▇▇▇▇▇▇▇ and
Energizer, such allocation shall be made as provided by the law of such
jurisdiction.
Notwithstanding the foregoing, any state or local net operating
losses or Tax credits generated by a member of the Energizer Group for any Tax
period beginning prior to the Distribution Date shall be for the benefit of
▇▇▇▇▇▇▇. As permitted by the applicable law of the appropriate Tax
jurisdiction, such net operating losses or Tax credits shall be first carried
back to prior Tax periods. In the event that (i) the applicable law of the Tax
jurisdiction does not permit the carryback of such losses or Tax credits, or
(ii) such losses or Tax credits cannot be fully utilized in an allowable
carryback, then Energizer shall pay ▇▇▇▇▇▇▇ the amount of the actual diminution
of any state or local Taxes of Energizer resulting from the utilization by any
member of the Energizer Group of such losses or credits within thirty (30) days
of the filing of the Tax Return reflecting the utilization of such loss or Tax
credit, in accordance with Article VI, 3 hereof.
(ii) Any excess Foreign Tax credits of the ▇▇▇▇▇▇▇ Group, as of
the Distribution Date, as finally determined by ▇▇▇▇▇▇▇ in accordance with Code
Section 904, shall be allocated between the ▇▇▇▇▇▇▇ Group and the Energizer
Group, in accordance with Reg. 1.1502-79(d).
(iii) Any earnings and profits of the ▇▇▇▇▇▇▇ Group as of the
Distribution Date, as finally determined by ▇▇▇▇▇▇▇, shall be allocated between
the ▇▇▇▇▇▇▇ Group and the Energizer Group in accordance with Reg. 1.312-10(a).
(iv) Any Capital Loss Carryovers of the ▇▇▇▇▇▇▇ Group, as of the
end of the fiscal year that includes the Distribution Date, as finally
determined by ▇▇▇▇▇▇▇, shall be allocated between the ▇▇▇▇▇▇▇ Group and the
Energizer Group in accordance with
Reg. 1.1502-22T.
(g) Dual Resident Corporations. Energizer shall timely enter into any
---------------------------
closing agreement with ▇▇▇▇▇▇▇ and the IRS in accordance with Regs Section
1503-2(g)(2)(iv)(B)(2), to the extent necessary to avoid recapture of any "dual
consolidated loss", within the meaning of Regs. Section 1.1503-2(c)(5) generated
by any Energizer Domestic Subsidiary, which constitutes a "dual resident
corporation" within the meaning of Regs. Section 1.1503-2(c)(2). To the extent
Energizer causes the recapture of any "dual consolidated loss" created prior to
the Distribution Date, Energizer shall pay or reimburse ▇▇▇▇▇▇▇ for any taxes
and interest due as a result of the recapture.
(h) Gain Recognition Agreements. Energizer shall timely file any
-----------------------------
annual certifications required by any Agreements to Recognize Gain pursuant
to Reg. 1.367(a)-3T(g) entered into by ▇▇▇▇▇▇▇ to defer gain on a transaction
including an Energizer Foreign Affiliate. To the extent Energizer causes the
recognition of any such deferred gain after the Distribution Date, Energizer
shall pay or reimburse ▇▇▇▇▇▇▇ for any Domestic Taxes and interest due as a
result of the recognition of such gain.
ARTICLE III. FOREIGN TAXES
1. Preparation and Filing of Ttax Returns, Payment of Taxes, Adjustments,
-------------------------------------------------------------------------
Audits and Controversies.
--------------------------
(a) Preparation and Filing of Foreign Returns.
----------------------------------------------
(i) Energizer shall be responsible for the preparation and filing
of any Foreign Tax Return of any Energizer Foreign Affiliate for all Tax
Periods.
(ii) ▇▇▇▇▇▇▇ shall be responsible for the preparation and filing
of any Foreign Tax Return of any ▇▇▇▇▇▇▇ Foreign Affiliate for all Tax Periods.
(iii) In the case of any Joint Foreign Affiliate, which, after the
Distribution Date, shall become a ▇▇▇▇▇▇▇ Foreign Affiliate or an Energizer
Foreign Affiliate, as the case may be, consistent with the definition herein of
"Joint Foreign Affiliate," with the cooperation and assistance of ▇▇▇▇▇▇▇ and
Energizer, shall prepare and file any Foreign Tax Return of such entity for any
Tax period ending prior to, or straddling, the Distribution Date.
(b) Liability for Foreign Taxes.
------------------------------
(i) Except in respect of (A) the Foreign Transfer Taxes described
in subparagraph (c) below, and (B) any Foreign Taxes with respect to the (I)
U.K. Restructuring, (II) Brazilian Restructuring, (III) Mexican Restructuring,
(IV) Argentinean/Chilean Restructuring, or (V) Canadian Restructuring, as
described in Article II of the Plan of Reorganization, or (VI) the
pre-Distribution Date transactions listed on the attached Schedule A. Energizer
shall be liable for, shall indemnify and hold the ▇▇▇▇▇▇▇ Group and the ▇▇▇▇▇▇▇
Foreign Affiliates harmless against, and shall make payment of all Foreign Taxes
attributable to the Battery Business and any Former Battery Business, for any
and all Tax periods commencing before, on, or after the Distribution Date,
including any Foreign Taxes attributable to the Battery Business and the Former
Battery Business conducted by any Joint Foreign Affiliate and including any such
liabilities resulting from an Audit or other adjustment to previously filed Tax
Returns. Other than refunds of the Foreign Transfer Taxes and Foreign Taxes
with respect to the Restructurings, described in (A) and (B) above, Energizer
shall be entitled to any refund of Foreign Taxes attributable to the Battery
Business and any Former Battery Business for any such Tax periods, including any
Foreign Taxes attributable to the Battery Business and any Former Battery
Business conducted by any Joint Foreign Affiliate. The allocation of any such
Foreign Taxes between or among the ▇▇▇▇▇▇▇ Business, the Battery Business, the
Former ▇▇▇▇▇▇▇ Business or any Former Battery Business of a Joint Foreign
Affiliate shall be determined in accordance with the books and records of
▇▇▇▇▇▇▇, any ▇▇▇▇▇▇▇ Foreign Affiliate and any Joint Foreign Affiliate, as
though the Battery Business or Former Battery Business were deemed to have been
conducted as the sole business of such Joint Foreign Affiliate.
(ii) ▇▇▇▇▇▇▇ shall be liable for, shall indemnify and hold the
Energizer Group and the Energizer Foreign Affiliates harmless against, and shall
make payments of, all (A) Foreign Taxes owed by any ▇▇▇▇▇▇▇ Businesses and
Former ▇▇▇▇▇▇▇ Businesses, for any and all Tax periods commencing before, on, or
after the Distribution Date, including any such Foreign Taxes attributable to
the ▇▇▇▇▇▇▇ Businesses or the Former ▇▇▇▇▇▇▇ Businesses conducted by any Joint
Foreign Affiliate prior to the Distribution Date, and including any such
liabilities resulting from an Audit or other adjustment to previously filed Tax
Returns and (B) any Foreign Taxes with respect to the Restructurings. ▇▇▇▇▇▇▇
shall be entitled to any refund of such Foreign Taxes for any Tax period. The
allocation of any such Foreign Taxes between or among the ▇▇▇▇▇▇▇ Businesses,
the Battery Business, any Former ▇▇▇▇▇▇▇ Businesses or any Former Battery
Businesses of a Joint Foreign Affiliate shall be determined in accordance with
the books and records of ▇▇▇▇▇▇▇, any ▇▇▇▇▇▇▇ Foreign Affiliate and any Joint
Foreign Affiliate, as may be appropriate, as though the Battery Business or
Former Battery Business were deemed to have been conducted as the sole business
of such Joint Foreign Affiliate.
(iii) If, in accordance with this Article III 1(b), either ▇▇▇▇▇▇▇
or Energizer is liable for any portion of the Foreign Taxes payable in
connection with any Foreign Tax Return to be filed by the other, the party
responsible for filing such Return (the "Preparer") shall prepare and deliver to
the other party (the "Payor") a copy of such return and any schedules, work
papers and other documentation then available that are relevant to the
preparation of the portion of such return for which the Payor is or may be
liable hereunder not later than the earlier of (A) twenty (20) days prior to the
due date for such Tax Return (including applicable extensions) (the "Due Date"),
or (B) the date the information is available in the normal course of business.
The Preparer shall not file such return until the earlier of either the receipt
of written notice from the Payor indicating the Payor's consent thereto, or five
(5) days prior to the Due Date to ensure timely receipt of the return by the
taxing jurisdiction.
The Payor shall have the option of providing to the Preparer, at
any time at least ten (10) days prior to the Due Date, written instructions as
to how the Payor wants any, or all, of the items for which it may be liable in
full reflected on such Tax Return. Failure by the Payor to give written
instructions at least ten (10) days prior to the Due Date shall constitute a
waiver by the Payor of its right to provide instructions, to the extent such
failure is prejudicial to the Preparer.
The Preparer shall, in preparing such Return, cause the items for
which the Payor is liable hereunder to be reflected in accordance with the
Payor's instructions unless the Preparer determines that such manner of
reporting is in contravention of applicable law. In the absence of having
received instructions from Payor, such items shall be reported in the manner
determined by the Preparer, which is not in contravention of applicable law, and
consistent with historic business practices, as applicable. The Payor shall
timely pay the Preparer an amount equal to the Foreign Taxes for which it is
liable consistent with the Return, and in accordance with Article VI 3 hereof.
(c) Foreign Transfer Taxes. ▇▇▇▇▇▇▇ shall pay or shall reimburse
------------------------
Energizer or an Energizer Foreign Affiliate as appropriate, for payment of any
and all Foreign Taxes upon, or by virtue of, any transfer of property
contemplated under the Plan of Reorganization, including the transfer of shares
of stock of Energizer Foreign Affiliates to Energizer in connection with the
Distribution. Foreign Tax Returns required to be prepared and filed by
Energizer relating to the transfer of shares of stock of Energizer Foreign
Affiliates to Energizer, must be provided to ▇▇▇▇▇▇▇ by Energizer at least ten
(10) days prior to the due date for such Tax Returns so that ▇▇▇▇▇▇▇ may timely
make any payment of Foreign Transfer Taxes due with respect to such Foreign Tax
Return. ▇▇▇▇▇▇▇ shall reimburse Energizer, or an Energizer Foreign Affiliate,
as appropriate, for any such Foreign Transfer Taxes paid, within thirty (30)
days of presentation of a receipt evidencing payment of such Taxes by the
Foreign Affiliate.
(d) Foreign Audits and Controversies.
-----------------------------------
(i) Energizer, at its expense, shall exclusively control and
direct any Audit or Controversy with respect to any Energizer Foreign Affiliate.
▇▇▇▇▇▇▇, however, shall have the right to participate in any such Audit or
Controversy to the extent such Audit or Controversy would impact the Foreign
Taxes or Domestic Taxes for which ▇▇▇▇▇▇▇ is liable in accordance with this
Agreement. Energizer shall not consent to any resolution, compromise or
conclusion of such Audit or Controversy without the written approval of ▇▇▇▇▇▇▇,
which approval shall not be unreasonably withheld. Notwithstanding the
foregoing, in the event Energizer shall compromise or settle any such deficiency
of Foreign Tax without the prior consent of ▇▇▇▇▇▇▇, Energizer shall indemnify
and hold ▇▇▇▇▇▇▇ and any ▇▇▇▇▇▇▇ Foreign Affiliate harmless against any losses,
costs, or damages, including Taxes resulting from such compromise or settlement.
(ii) ▇▇▇▇▇▇▇, at its expense, shall exclusively control and direct
any Tax Audit or Controversy as to any Foreign Tax with respect to any ▇▇▇▇▇▇▇
Foreign Affiliate. Energizer, however, shall have the right to participate in
any such Audit or Controversy to the extent such Audit or Controversy would
impact the Foreign Taxes for which Energizer is liable in accordance with this
Agreement. ▇▇▇▇▇▇▇ shall not consent to any resolution, compromise or
conclusion of such Audit or Controversy without the written approval of
Energizer, which approval shall not be unreasonably withheld. Notwithstanding
the foregoing, in the event ▇▇▇▇▇▇▇ shall compromise or settle any such
deficiency of Foreign Tax without the prior consent of Energizer, ▇▇▇▇▇▇▇ shall
indemnify and hold Energizer and any Energizer Foreign Affiliate harmless
against any losses, costs, or damages, including Taxes resulting from such
compromise or settlement.
(e) Foreign Tax Attributes.
------------------------
Subject to subparagraph (c) above regarding Foreign Transfer Taxes,
any Foreign Tax attribute generated by ▇▇▇▇▇▇▇ or Energizer shall, to the extent
permitted by the applicable law of the Tax jurisdiction in question, remain with
▇▇▇▇▇▇▇ or Energizer, respectively, or the appropriate entity. In any case
where the applicable law of the Tax jurisdiction in question requires such Tax
attribute to be allocated between ▇▇▇▇▇▇▇ and Energizer, such allocation shall
be made as provided by the law of such jurisdiction. In the event the
applicable law of the Tax jurisdiction requires that such Tax Attribute be
allocated between the parties based on a method of allocation agreed to by the
parties, ▇▇▇▇▇▇▇ and Energizer shall apply an allocation method reasonably
agreed to by both parties.
(f) Competent Authority.
--------------------
If, as a result of a Tax Audit for any Tax Period ending prior to the
Distribution Date (a) the IRS proposes a deficiency with respect to ▇▇▇▇▇▇▇ or
any ▇▇▇▇▇▇▇ Domestic Subsidiary or Energizer or any Energizer Domestic
Subsidiary or (b) any foreign Tax authority proposes a deficiency with respect
to any ▇▇▇▇▇▇▇ Foreign Affiliate or Energizer Foreign Affiliate, in either case
attributable to a proposed adjustment in transfer prices with respect to any of
the foregoing entities, and such adjustment, if sustained, would result in
liability for double Domestic or Foreign Taxes to ▇▇▇▇▇▇▇ or Energizer, to the
extent available under applicable tax treaties and the procedures applied by the
IRS and/or the foreign tax authority, ▇▇▇▇▇▇▇ or Energizer, depending on which
party would be subject to such double taxation, decides to request "competent
authority" (within the meaning of Rev. Proc. 96-13, 1996-1 C.B. 616) assistance
of the appropriate Tax authority or its equivalent ("Competent Authority"), then
the following provisions shall apply: The party initiating the Competent
Authority process, at its expense, shall diligently pursue such Competent
Authority assistance, including without limitation, filing any required amended
Tax Return, in connection with any such Tax Audit and complying with the
applicable procedures of such Competent Authority process. To the extent that
▇▇▇▇▇▇▇, as a result of such Competent Authority process, receives a refund of
double Foreign Taxes relating to a Tax Audit of Domestic Taxes of Energizer for
which ▇▇▇▇▇▇▇ is or was liable under this Agreement or utilizes the benefit of
any overpayment of such Foreign Taxes, ▇▇▇▇▇▇▇ shall retain such refund or
utilize the benefit of any such overpayment of Foreign Taxes and to the extent
that Energizer, as a result of such Competent Authority process, receives a
refund of double Foreign Taxes relating to a Tax Audit of Domestic Taxes of
Energizer for which ▇▇▇▇▇▇▇ is or was liable under this Agreement or utilizes
the benefit of such overpayment, Energizer shall pay an amount equal to such
refund or overpayment to ▇▇▇▇▇▇▇ . To the extent that ▇▇▇▇▇▇▇, as a result of
such Competent Authority process, receives a refund of double Domestic Taxes
relating to a Tax Audit of Foreign Taxes of Energizer for which Energizer is or
was liable under this Agreement or utilizes the benefit of any overpayment of
such Domestic Taxes, ▇▇▇▇▇▇▇ shall pay an amount equal to such refund or
overpayment to Energizer, and, to the extent that Energizer, as a result of such
Competent Authority process, receives a refund of such double Domestic Taxes
relating to a Tax Audit of Foreign Taxes of Energizer for which Energizer is or
was liable under this Agreement or utilizes the benefit of any overpayment of
such Domestic Taxes, Energizer shall retain such refund or utilize the benefit
of such overpayment.
(g) Reimbursement of Other Tax Benefits.
---------------------------------------
Energizer shall reimburse ▇▇▇▇▇▇▇ to the extent of Foreign Tax
benefits derived by any member of the Energizer Group, for payments made by
▇▇▇▇▇▇▇ to third parties on or after the Distribution Date, which result in a
Tax deduction to Energizer or an Energizer Foreign Affiliate ("▇▇▇▇▇▇▇
Payments"), provided such ▇▇▇▇▇▇▇ Payments (a) are not claimed as a deduction by
▇▇▇▇▇▇▇ for Foreign Tax purposes, (b) are deductible on a Foreign Tax Return of
the Energizer Group, and (c) result in a reduction of Foreign Taxes of
Energizer, the Energizer Group, or any Energizer Foreign Affiliate. The amount
of the payment required hereunder for any taxable period of Energizer shall be
equal to the actual diminution of any Foreign Taxes by reason of any ▇▇▇▇▇▇▇
Payments. Provided, however, if for any taxable period, (X) Energizer or
▇▇▇▇▇▇▇ files an amended Foreign Tax Return (or files a carryback or
carryforward claim relating to a net operating loss), or (Y) the Foreign Tax
authority adjusts any item on any Energizer or ▇▇▇▇▇▇▇ Foreign Tax Return, the
amount of the payment required under this paragraph shall be recomputed (either
at the time of the filing of the amended return, or carryover or carryback
claim, or at the time of the final determination of the adjustment) to reflect
such amended return, claim, or adjustment, and, at such time, either (I) ▇▇▇▇▇▇▇
shall repay any overpayment by Energizer under this paragraph to Energizer, or
(II) Energizer shall pay any underpayment under this paragraph to ▇▇▇▇▇▇▇.
ARTICLE IV. NEGOTIATION
For the purposes of this Agreement, all computations or recomputations of
Tax liability, and all computations or recomputations of any amount or any
payment (including, but not limited to, computations of the amount of the tax
liability, any loss or credit or deduction, statutory tax rate for a year,
interest payments, and adjustments) and all determinations of payments or
repayments, or determination of any other nature required to be made pursuant to
this Agreement, shall be based on the assumptions and conclusions of the party
making the computations. If either ▇▇▇▇▇▇▇ or Energizer objects thereto in
writing, addressed to the other party, the provisions of Article XI of the Plan
of Reorganization shall be applicable to resolve any issues under this Tax
Sharing Agreement.
ARTICLE V. ENERGIZER POST-DISTRIBUTION TRANSACTIONS
1. Energizer shall, and shall cause each member of the Energizer Group and
each Energizer Foreign Affiliate to comply with each representation and
statement made, or to be made, to the IRS in connection with any ruling
obtained, or to be obtained, by ▇▇▇▇▇▇▇ from the IRS with respect to any
transaction contemplated by the Plan of Reorganization. Neither Energizer nor
any member of the Energizer Group shall for a period of thirty (30) months, with
respect to transactions described in subparagraphs I, III, IV, V, and VI, below;
and twenty-four months with respect to the transaction described in subparagraph
II below, following the Distribution Date engage in any of the following
transactions, unless, in the sole discretion of ▇▇▇▇▇▇▇, either (a) an opinion
in form and substance satisfactory to ▇▇▇▇▇▇▇ is obtained from counsel to
Energizer, the selection of which counsel is agreed to by ▇▇▇▇▇▇▇ or (b) a
supplemental ruling is obtained from the IRS, in either case to the effect that
such transactions would not adversely affect the tax consequences of the
transactions contemplated by the Plan of Reorganization to (i) ▇▇▇▇▇▇▇ or any
member of the ▇▇▇▇▇▇▇ Group, (ii) Energizer or any member of the Energizer
Group, or (iii) the ▇▇▇▇▇▇▇ shareholders. The transactions subject to this
provision include: (I) making a material disposition (including transfers from
one member of the Energizer Group to another member of the Energizer Group), by
means of a sale or exchange of assets or shares of stock, a distribution to
shareholders, or otherwise, of any of its assets (other than the transactions
contemplated by the Plan of Reorganization) except in the ordinary course of
business; (II) repurchasing any Energizer Shares, unless such repurchase
satisfies the requirements of Section 4.05(1)(b) of Revenue Procedure 96-30;
(III) issuing capital stock of Energizer (or a successor to Energizer), whether
incident to a stock offering, an acquisition transaction, or otherwise, or
participating in a transaction in which shareholders of Energizer (or a
successor to Energizer) exchange or otherwise dispose of their stock in
Energizer (or a successor to Energizer), if the aggregate amount of shares
issued or disposed of in any such transactions represents a "fifty percent (50%)
or greater interest" in the total issued and outstanding stock of Energizer (or
a successor to Energizer) within the meaning of section 355(d)(4) of the Code;
provided that Energizer further agrees to notify ▇▇▇▇▇▇▇ in advance of any such
transactions that would result in the issuance or disposition of an aggregate
amount of shares representing a ten percent (10%) or greater interest in the
total issued and outstanding stock of Energizer; (IV) liquidating or merging
with any other corporation (including a member of the Energizer Group); (V)
ceasing to engage in the active conduct of a trade or business within the
meaning of Section 355(b)(2) of the Code; or (VI) any other transaction, action,
or event which in any material respect is inconsistent with the representations
and statements set forth on Schedule 8.01(b)(vi) to the Agreement and Plan of
Reorganization. Energizer hereby represents that neither Energizer nor any
member of the Energizer Group has any present intention to undertake any of the
transactions set forth above, except as set forth in the ruling request
submitted to the IRS with respect to the Distribution.
2. ▇▇▇▇▇▇▇ shall, and shall cause each member of the ▇▇▇▇▇▇▇ Group and each
▇▇▇▇▇▇▇ Foreign Affiliate to refrain from taking any action which would
adversely impact any ruling obtained, or to be obtained, by ▇▇▇▇▇▇▇ from the IRS
with respect to any transaction contemplated by the Agreement of Reorganization.
ARTICLE VI. MISCELLANEOUS PROVISIONS
1. Mutual Cooperation. ▇▇▇▇▇▇▇ and Energizer shall, and shall cause each of
------------------
their Domestic Subsidiaries and Foreign Affiliates to, cooperate with each other
in filing any Tax Returns or consents contemplated by this Agreement and to take
such actions as the other party may reasonably request, including but not
limited to the following: (a) provide data for the preparation of Tax Returns,
including schedules, and make elections that may be required by the other party;
(b) provide required documents and data and cooperate in Audits or
investigations of Tax Returns and execute appropriate powers of attorney in
favor of the other party and/or its agents; (c) file protests or otherwise
contest proposed or asserted tax deficiencies, including filing petitions for
redetermination or prosecuting actions for refund in court, and pursuing the
appeal of such actions; (d) take any of the actions of the type described in
Regulation Section 1.1502-77(a) of the Code (describing the scope of the agency
of the common parent of a group of affiliated corporations); and (v) file
requests for the extension of time within which to file Tax Returns.
2. Maintenance of Books and Records. Until the applicable statute of
------------------------------------
limitations (including periods of waiver), or statute of similar import, has
expired in accordance with laws governing Domestic or Foreign Taxes and Tax
Returns, ▇▇▇▇▇▇▇ and Energizer shall, and shall cause each Domestic Subsidiary
and Foreign Affiliate to, retain all Tax workpapers and related materials
including applicable financial reports in its possession and under its control
used in the preparation of any Tax Return for Tax periods commencing prior to or
on the Distribution Date. ▇▇▇▇▇▇▇ and Energizer will notify the other party
sixty (60) days prior to disposing of any of the aforementioned records and will
deliver to the other party, at the other party's expense, any such records
requested by the other party. In addition, Energizer shall generate and retain
for IRS audit use (i) all necessary electronic data processing ("EDP") records
in accordance with existing agreements with the IRS, and (ii) any necessary
computer hardware or source codes needed to process EDP records for the IRS. As
requested, from time to time, by Energizer or ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ and Energizer
shall each provide the other with timely access to, and right to copy, any
records and other information reasonably requested concerning tax matters
affecting Energizer and ▇▇▇▇▇▇▇ and the cooperation of their respective
accountants and auditors, including, without limitation, information concerning
stock and asset bases, holding period, earnings and profits, intercompany
transactions, balance sheet and income statement tax provisions, reserves and
deferred tax accounts. In no event shall such access to available information
be provided more than thirty (30) days after written request therefor.
3. Payment. Failure to make any payment required under this Agreement will
-------
result in the accrual of interest on such amount due. Any interest payment
required hereunder shall be calculated from the same date and at the rate used
by the IRS, any foreign, state, or local tax authority, as applicable, in
computing the interest payable by it or to it. Unless otherwise provided, all
payments required to be made under this Agreement from one party to another
shall be made within thirty (30) days after the event which gives rise to the
requirement for payment occurs. Any payments made pursuant to this Agreement
are to be adjusted in the event that future events or new information would, had
they occurred or been known at the time of a payment, have altered the amount of
such payment, so that at the time of such future events or knowledge of such
information, appropriate adjustments shall be made retroactively to include the
consequences of such event or information in the original computation.
4. Treatment of Intercompany Payments. To the extent that any payments are
------------------------------------
made between Energizer and ▇▇▇▇▇▇▇ pursuant to this Agreement, for purposes of
Domestic Tax treatment, such payments to ▇▇▇▇▇▇▇ by Energizer shall be treated
as a distribution under Section 301 of the Code by Energizer to ▇▇▇▇▇▇▇ at a
time when the two corporations filed a consolidated federal income tax return,
and such payments by ▇▇▇▇▇▇▇ to Energizer shall be treated as a nontaxable
contribution by ▇▇▇▇▇▇▇ to the capital of Energizer immediately prior to the
Distribution Date. In any event, any payments made between Energizer and ▇▇▇▇▇▇▇
pursuant to this Agreement shall be subject to any required withholding of Taxes
and shall be made net of any such Taxes required to be withheld on such
payments, provided, however, to the extent feasible, such payments shall be
structured so as to be free of withholding Taxes or to minimize withholding
Taxes. Whenever any such withholding Taxes are payable by or on behalf of the
payor, as promptly as possible thereafter, the payor shall send to the payee a
certified copy or an original official receipt received by the payor showing
payment thereof.
5. Energizer Domestic Tax Accruals. Prior to the Distribution Date,
----------------------------------
Energizer will transfer to the books of ▇▇▇▇▇▇▇ any Domestic Tax accrual
balances (credits) recorded on any books of any Energizer Domestic Subsidiary as
of the Distribution Date. Prior to the Distribution Date, ▇▇▇▇▇▇▇ will transfer
to the books of Energizer any Domestic Tax accrual balances (credits) recorded
on any books of ▇▇▇▇▇▇▇ as of the Distribution Date relating to Foreign Taxes
for which Energizer is, or may become, liable under this Agreement.
6. Tax Sharing Agreements. Any other tax sharing or tax allocation or
------------------------
similar agreement or arrangement in effect between Energizer and ▇▇▇▇▇▇▇,
whether oral or in writing, shall terminate as between Energizer and ▇▇▇▇▇▇▇ on
the Distribution Date and, notwithstanding anything in such agreement to the
contrary, any rights or obligations of Energizer and ▇▇▇▇▇▇▇ under any such
agreement or arrangement shall be superseded by the terms of this Agreement.
7. No Double Tax Benefit. Anything in this Agreement to the contrary
------------------------
notwithstanding, neither ▇▇▇▇▇▇▇ nor Energizer shall be entitled to any double
benefit both (i) by reason of any payment otherwise required to be made between
the parties under this Agreement and (ii) any Tax benefit or avoidance of any
Tax detriment under applicable Domestic or Foreign Tax law, including, without
limitation, (x) being required to make any payment to the other for any loss of
Tax benefit under this Agreement to the extent that such party is entitled to,
and actually receives, such Tax benefit under applicable Tax law or (y) entitled
to receive any payment under this Agreement for any apparent Tax detriment to
the extent such party is entitled to, and actually is able to, avoid such Tax
detriment, under such Tax law.
8. Governing Law. This Agreement shall be governed and construed in
--------------
accordance with the laws of the State of Missouri, and the United States of
America, notwithstanding any conflict of law provision to the contrary, and
shall be binding on the successors and assigns of the parties hereto.
9. Entire Agreement. Unless otherwise specified, this Agreement contains
-----------------
the entire agreement between the parties hereto with respect to the subject
matter hereof and supersedes all prior written agreements, memoranda,
negotiations and oral understandings, if any, and may not be amended,
supplemented or discharged except by performance or by an instrument in writing
signed by all of the parties hereto.
10. Controlling Agreement. In the case of a conflict between the Plan of
----------------------
Reorganization and this Agreement, this Agreement shall control.
Notwithstanding anything in this Agreement to the contrary any rights or
obligations with respect to Taxes affecting the ▇▇▇▇▇▇▇ Purina Charitable Trust
shall be controlled by Section 2.07 of the Agreement and Plan of Reorganization.
11. Counterpart. This Agreement may be executed simultaneously in two or
-----------
more counterparts, each of which shall be deemed an original, but which together
shall constitute one and the same instrument.
12. Intellectual Property. Notwithstanding anything in this Agreement to the
---------------------
contrary, ▇▇▇▇▇▇▇ shall not be liable for any Taxes resulting from the transfer
or registration of any intellectual property for which ▇▇▇▇▇▇▇ does not bear
responsibility for costs under the Intellectual Property Agreement as defined in
Section 5.04 of the Plan of Reorganization between ▇▇▇▇▇▇▇ and Energizer.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the date first above written.
▇▇▇▇▇▇▇ PURINA COMPANY
BY /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President and Chief Financial Officer
ENERGIZER HOLDINGS, INC.
BY /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President and General Counsel
SCHEDULE A
Foreign Transactions for which Energizer is not Liable for Foreign Taxes
--------------------------------------------------------------------------------
1. ERL Liquidation
2. UK Teddy's Financing
3. CRES Sale
4. RESIB/Iberia Sale
5. Italian Usufruct
6. EUK Debt
7. EPS Sale
8. Agribrands Spin-off
9. Protein Sale
EXHIBIT B
BRIDGING SERVICES AGREEMENT
---------------------------
This Bridging Services Agreement (the "Agreement") is made as of this 1st day of
---
April, 2000, (the "Effective Date") by and between ▇▇▇▇▇▇▇ Purina Company, a
-----
Missouri Corporation ("▇▇▇▇▇▇▇"), and Energizer Holdings, Inc., a Missouri
corporation ("Energizer").
WHEREAS, the parties have entered into an Agreement and Plan of
Reorganization ("Plan of Reorganization") dated as of April 1, 2000;
WHEREAS, ▇▇▇▇▇▇▇ and Eveready Battery Company, Inc., a Delaware corporation
("Eveready") have executed a lease agreement beginning as of April 1, 2000
pursuant to which Eveready will lease certain office space from ▇▇▇▇▇▇▇ (the
"Lease");
WHEREAS, pursuant to the Plan of Reorganization, the parties have agreed
that ▇▇▇▇▇▇▇ and Energizer desire to provide each other and their respective
affiliates with certain services as more fully described on Schedules 1 through
-
31, (and any exhibits attached thereto), all of which are attached hereto and
--
incorporated herein by reference, (collectively, the "Services"), on an interim
basis after April 1, 2000;
WHEREAS, ▇▇▇▇▇▇▇ and Energizer desire to enter into this Agreement to
confirm the terms and conditions pursuant to which each party will provide to
the other party, for a limited time from and after the Effective Date, the
Services.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. Services. Subject to the terms of this Agreement, from and after the
---------
Effective Date, the party providing the particular Services (the "Provider")
shall make such Services available to the party receiving such Services (the
"Recipient") in accordance with the practices in effect as of the Effective Date
or as specifically set forth in the Schedules.
2. Price for Services. In consideration for the Services, the Recipient
--------------------
shall pay to the Provider the fee or other charge set forth opposite each such
Service on the applicable Schedule and each Service provided will be separately
invoiced to Recipient in accordance with the billing provisions set forth in the
Schedule with respect to such Service. Unless otherwise provided for in the
applicable Schedule, the basis for price determinations will be cost to the
Provider plus 10%, plus any travel or other out of pocket expenses. Cost shall
be determined by the Provider in a reasonable manner, which absent manifest
error or inaccuracy shall be binding on the parties. Upon written request by
Recipient, Provider will furnish such written documentation as it shall
reasonably determine is necessary to support its cost determination. Unless
otherwise provided for in the applicable Schedule, the price for Services shall
be subject to adjustment effective October 1, 2000, and annually thereafter, to
accommodate annual fiscal year increases in the cost to Provider in providing
the Services. Prices for Services shall also be subject to adjustment upon
thirty (30) days prior written notice from Provider to Recipient, if such
adjustment is the result of an actual cost adjustment by a third party provider
or outside vendor to Provider.
3. Limitations. The following limitations on responsibility and liability
-----------
shall apply to both Providers in connection with their provision of Services
hereunder:
(a) Neither Provider shall be obligated to (i) hire any additional
personnel; (ii) maintain the employment of any person; (iii) purchase, lease,
license or otherwise obtain any equipment, facilities, software, or other items;
or (iv) pay any extraordinary cost or suffer any extraordinary expense in
transferring, converting, preserving, storing or maintaining any records,
information or data belonging to either Recipient. Upon termination of this
Agreement or any applicable Schedule, each Recipient shall promptly return to
each Provider any equipment or other property owned, leased or licensed by or to
such Provider which is in the Recipient's possession, custody or control.
(b) Neither Provider shall be liable to either Recipient for any
liabilities, claims, losses, demands, obligations, costs, expenses, proceedings,
taxes, levies, imposts, duties, deficiencies, assessments, charges, damages or
judgments of any kind, name, nature or description, including without limitation
attorney's fees and expenses (collectively, "Liabilities"), unless such
Liabilities arise solely and directly from the willful misconduct of the
Provider. In such event, the liability of the Provider shall be limited to the
lesser of (i) the Provider's correction of the defect in the Service provided;
or (ii) the return of a pro-rata portion of the fee charged for the Service that
is attributable to the defect in the Service provided.
(c) The provision of any Service hereunder by either Provider shall be
deemed an unqualified acceptance of such Service by the Recipient, and no claim
relating to any defect in Service provided (which shall, in all cases, be
limited by the terms of Section 3(b) hereof) shall be made against the Provider
of the Service more than thirty (30) days after such Service is rendered. All
such claims shall be in writing, stating in reasonable detail the defect in
Service claimed.
(d) Neither Provider shall be liable to any affiliate, contractor, agent or
employee of either Recipient, or to any third party whatsoever, for any
Liabilities arising from or relating to the Provider's performance of this
Agreement.
(e) Neither Provider shall in any event be liable to either Recipient, or to
any of such Recipient's affiliates, contractors, agents or employees, or to any
third party whatsoever, for any special, indirect, incidental, consequential or
punitive damages alleged to arise out of or relate to the performance of this
Agreement.
(f) Neither Provider shall be liable to either Recipient to the extent that
Services provided under a Schedule are terminated, in whole or in part, earlier
than the stated duration if the basis for providing such Services requires the
consent or cooperation of a third party, and such third party refuses to give
such consent or cooperation. In such case, Provider shall be immediately
relieved of any obligation to provide those Services to the Recipient, and
Recipient shall be relieved of any obligation to pay for any Services not yet
performed.
4. Indemnification. Each Recipient of Services hereunder agrees and hereby
----------------
does indemnify and hold harmless each Provider of Services hereunder from and
against any and all Liabilities (as defined in Section 3 (b) hereof) arising out
of or relating to the performance of this Agreement, including any Liabilities
alleged to result solely from the negligence of the Provider, and saving only
such Liabilities as may arise solely and directly from the willful misconduct of
the Provider.
5. Additional Services. If a party to this Agreement wants the other to
---------------------
provide any service other than the Services provided for in the Schedules, such
party shall notify the other in writing, and within thirty (30) days following
the giving of such notice, such other party shall decide, in its sole
discretion, whether to provide such additional service. If such other party
agrees to be a Provider with respect to such additional service, the Recipient
and Provider shall mutually agree on the fee for such service and shall set
forth the terms of their agreement with respect to the additional service in a
separate schedule that shall be incorporated herein. The provision by Provider
of any such additional services shall be considered "Services" hereunder and
subject to all other provisions of this Agreement, as if those additional
services had originally been part of the Schedules to this Agreement.
6. Confidentiality. The parties will use their best efforts to restrict
----------------
any information (including, but not limited to, confidential information) which
is exchanged between the parties under this Agreement to those employees or
agents who are required to know or utilize such information in order to provide
the Services hereunder. Any and all information which is not generally known to
the public and which is exchanged between the parties in connection with this
Agreement, and which consists of employee information (including payroll
records, benefits information, and personnel files), business or marketing
plans, forecasts, financial records, financing information, capital and
operating budgeting information, tax return preparation information, plus any
other information that is identified in writing as "CONFIDENTIAL" by either
party within ten (10) days of disclosure thereof, whether of a technical or
business nature, shall be considered to be confidential. The parties agree that
confidential information shall not be disclosed to any third party or parties
without the prior written consent of the other party. In the event that either
party shall receive a subpoena, order or official request for the disclosure of
the other's confidential information, it shall promptly (and if possible, no
later than seven (7) days prior to the return date) advise the other party of
such subpoena, order or request, in order to enable such other party to seek
relief or appropriate protection from such subpoena, order or official request.
Each party shall take reasonable measures to protect against nondisclosure of
confidential information by its officers, employees and agents. Confidential
information shall not include any information (i) which is or becomes part of
the public domain; (ii) which is obtained from third parties who are not bound
by confidentiality obligations; (iii) which is required to be disclosed by law,
regulation, legal process or the rules of any state or federal regulatory agency
or the New York Stock Exchange; or (iv) which was independently developed by or
for the receiving party. All confidentiality provisions shall expire two years
from April 1, 2000 or the date of disclosure of the confidential information,
whichever is later, unless otherwise specifically agreed to in writing or
provided by law.
7. Legal Advice. The parties acknowledge that none of the Services provided
------------
hereunder shall constitute legal advice or the rendering of legal services.
Each party shall rely solely on its own legal counsel for any legal advice or
legal services.
8. Assignment. Notwithstanding anything to the contrary in this Agreement,
-----------
this Agreement shall not be assignable by either party hereto, to any other
person, firm or entity without the prior written consent of the other party in
its sole and absolute discretion; provided, however, that the Agreement in its
entirety, or any portion of the rights and obligations established hereunder,
may be assigned by either party hereto to one of its directly or indirectly
wholly owned subsidiaries without the prior written consent of the other party.
Except as expressly provided herein, nothing herein shall create or be deemed to
create any third party beneficiary rights in any person or entity not a party to
this Agreement.
9. Waiver, Amendment or Modification. No waiver, amendment or modification
-----------------------------------
of this Agreement shall be valid unless in writing and duly executed by both
parties to this Agreement.
10. Entire Agreement. This Agreement, and the Schedules hereto (including
------------------
any exhibits), constitutes the entire agreement of the parties concerning the
subject matter hereof and supersedes all previous agreements between the
parties, whether written or oral, with respect to such subject matter. To the
extent that the provisions of this Agreement are inconsistent with the
provisions of any Exhibit to a Schedule, the provisions of such Exhibit shall
prevail.
11. Governing Law, Language and Currency. Despite any different result
----------------------------------------
required by any conflicts of law provisions, this Agreement shall be governed by
the laws of the State of Missouri, United States of America. This Agreement is
originally drafted in the English language. Should it be translated into any
other language, the English version shall govern any interpretation thereof.
The price for Services in each Schedule shall be in U.S. dollars unless
otherwise indicated.
12. Notices. All notices, requests, demands, waivers and other
-------
communications (hereinafter "Notices") required or permitted to be given
pursuant to this Agreement shall be in writing and shall be deemed to have been
duly given (i) at the time of delivery, if delivered by hand; (ii) on the date
of transmission, if sent by facsimile, telegram or other standard form of
telecommunications; or (iii) three (3) business days after mailing, if mailed
registered or certified first-class mail, postage prepaid, return receipt
requested. Notices shall be delivered or sent, as the case may be, to the
following addresses or to such other addresses as the parties may hereinafter
designate by like notice similarly provided:
If to Energizer: Energizer Holdings, Inc.
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
If to ▇▇▇▇▇▇▇: ▇▇▇▇▇▇▇ Purina Company
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
13. Force Majeure. Anything else in this Agreement notwithstanding, the
---------------
Provider shall be excused from providing Services hereunder while, and to the
extent that, its performance is prevented by fire, drought, explosion, flood,
invasion, rebellion, earthquake, civil commotion, strike or labor disturbance,
governmental or military authority, act of God, mechanical failure or any other
event or casualty beyond the reasonable control of the Provider, whether similar
or dissimilar to those enumerated in this paragraph (hereinafter a "Casualty").
In the event of a Casualty, the Recipient shall be responsible at its own cost
for making its own alternative arrangements with respect to the interrupted
Services.
14. Independent Contractor. The relationship of Provider and Recipient
------------------------
which is created hereunder is that of an independent contractor. This Agreement
is not intended to create and shall not be construed as creating between
Energizer and ▇▇▇▇▇▇▇ the relationship of affiliate, principal and agent, joint
venture, partnership, or any other similar relationship, the existence of which
is hereby expressly denied. Notwithstanding the foregoing, nothing in the
Schedules attached hereto shall cause any employee of the Provider to become a
leased employee or an independent contractor of the Recipient.
15. Billing and Payment. Unless otherwise provided in the applicable
----------------------
Schedule, the Provider shall ▇▇▇▇ the Recipient on a monthly basis for the
amounts due to the Provider for Services provided pursuant to the terms of this
Agreement. All such bills shall contain reasonable detail and shall be due
thirty (30) days after receipt unless any Schedules hereto provide for a
different payment period in which case such different payment period shall apply
to the applicable Services. The failure of the Recipient to pay any ▇▇▇▇ on
time shall result in the Recipient owing the Provider an additional handling
charge equal to one percent (1%) per month of the amount due from the date due
to the payment date.
16. Duration of Services. It is intended that the Services be provided by
-----------------------
each party hereto as a temporary accommodation to the other. Each party shall
arrange for the relevant Services to be provided by its own employees or by
third-party providers as soon as is practicable, even if such arrangements
result in greater cost to it than it would incur if the Services were provided
by the other party. In no event, however, shall either party be obligated to
provide any Services after March 31, 2001. Notwithstanding the foregoing, if
any Schedules hereto provide for the provision of Services for a longer period,
such longer period shall govern the provision of such Services. If provided for
in the Schedules, either party may give the other party written notice of its
intent to terminate any one or more of the Services prior to the stated
termination of the Services.
17. Termination. This Agreement shall remain in full force and effect for
-----------
as long as any Services are being provided pursuant to the Schedules attached
hereto. If any person who is not at the effective date of this Agreement an
affiliate of either party should acquire (by any means, including without
limitation by operation of law) a voting or equity interest of twenty percent
(20%) or more in such party, then the other party may terminate this Agreement
(without penalty and without further cause) upon thirty (30) days written notice
to such party.
18. Waiver. The failure of either party at any time or times to enforce or
-------
require performance of any provision hereof shall in no way operate as a waiver
or affect the right of such party at a later time to enforce the same. No
waiver by either party of the breach of any provision contained in this
Agreement shall be construed as a waiver of any subsequent breach of any
provision.
19. Severability. If any provision of this Agreement shall hereafter be
-------------
held to be invalid or unenforceable for any reason, that provision shall be
reformed to the maximum extent permitted to preserve the parties' original
intent, failing which it shall be severed from this Agreement with the balance
of the Agreement continuing in full force and effect. Such occurrence shall not
have the effect of rendering the provision in question invalid in any other
jurisdiction or in any other case or circumstances or of rendering invalid any
other provisions contained herein to the extent that such other provisions are
not themselves actually in conflict with any applicable law.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
on the day and year first above written.
▇▇▇▇▇▇▇ PURINA COMPANY ENERGIZER HOLDINGS, INC.
By:/s/ James Elsesser By: /s/ Harry Strachan
Name: James Elsesser Name: Harry Strachan
Title: Vice President and Chief Title: Vice President and General
Financial Officer Counsel
Index of Schedules to Bridging Services Agreement
NUMBER SCHEDULE
1 Records Management Services
2 Forms Management Services
3 Printing Services
4 Forms Warehousing and Distribution Services
5 Shipping Services
6 Mail Services
7 Maintenance Project Services
8 On-Site Medical Clinic
9 Checkerboard Square Facilities and Services
10 Property Accounting
11 Meeting and Travel Services
12 Employee Benefits Administration
13 Human Resource Information Systems
14 Human Resource Information Center and Payroll Services
15 Payroll Tax and Accounting
16 Telephone Services
17 Checkmark Services
18 Library and Information Services
19 Tax Services
20 Risk Management and Workers' Compensation Services
21 Corporate Public Relations Management Services
22 Internal Audit Services
23 Industrial Hygiene Services
24 Information Systems
25 Exchange of Payments Received in Error
26 Transportation Services
27 International - Singapore
28 International - Argentina
29 International - Canada
30 International - Philippines
31 International - United Kingdom
EXHIBIT C
INTELLECTUAL PROPERTY AGREEMENT
-------------------------------
THIS INTELLECTUAL PROPERTY AGREEMENT dated as of April 1, 2000 is by and between
RALSTON PURINA COMPANY, a corporation organized under the laws of the State of
Missouri, having its principal office at Checkerboard Square, St. Louis,
Missouri 63164 (hereinafter "Ralston") and ENERGIZER HOLDINGS, INC. a
corporation organized under the laws of the State of Missouri, having its
principal office at 800 Chouteau Avenue, St. Louis, Missouri 63102 (hereinafter
"Energizer").
WITNESSETH
WHEREAS, the parties have entered into an Agreement and Plan of Reorganization
of even date herewith; and
WHEREAS, pursuant to said Agreement and Plan of Reorganization, the parties have
agreed to divide certain intellectual property heretofore used in the business
of Ralston, Energizer, and/or its/their Affiliates;
NOW, THEREFORE, in consideration of the mutual covenants herein contained, and
for other good and valuable consideration, the parties agree as follows:
1. Definitions
(a) Affiliates
Hereunder, an "Affiliate" of, or persons "Affiliated" with, a
specified person, is a person that directly, or indirectly through one or more
intermediaries, controls, is controlled by or is under common control with the
person specified.
(b) Battery Business
Hereunder, "Battery Business" shall mean a business or portion of a
business devoted to batteries and/or lighting products, including components
therefor and collateral goods related thereto.
(c) Closing
Hereunder "Closing" shall have the same meaning as "Distribution Date"
in the Agreement and Plan of Reorganization.
(d) Intellectual Property
Hereunder, "Intellectual Property" shall include, but not be limited
to, trade secrets and confidential information; statutory, common law and
registered trademarks, trade styles, service marks, service names trade names,
trade dress, copyrights, moral rights, rights of privacy and publicity, Internet
or other electronic communication addresses (e.g., "▇▇▇▇▇▇▇▇▇.▇▇▇" and
1-800-982-ENRS), business addresses of a proprietary nature (e.g., "Ever Ready
House"), designs, inventions, know-how, issued and unissued patents, and other
property commonly considered intellectual property, all rights to recover for
past infringements of each of the foregoing, and the goodwill of the business to
the extent associated with any and all of the foregoing.
(e) Newco
Hereunder, except as limited hereinbelow, "Newco" shall mean Energizer
and any and all subsidiaries and Affiliates of Energizer. "Newco" shall not,
however, include Ralston and any of its Affiliates whose shares will be owned,
whether directly or indirectly, by Ralston following Closing.
(f) Oldco
Hereunder, "Oldco" shall mean Ralston and any and all of its
Affiliates whose shares it will directly or indirectly own following Closing.
(g) Trademark
Hereinafter "Trademark" shall mean a word, symbol, or device
registrable as a trademark or service mark.
(h) Trade Name
Hereinafter "Trade Name" shall mean corporate name and/or other
business name including, but not limited to, names of corporations,
partnerships, and joint ventures, and domain names.
2. Intellectual Property
(a) Assignments
(i) Except for Trademarks the parties agree to cancel, at or
before Closing, or at such date or dates as Newco may elect, Oldco will assign,
or will have assigned, to Newco, all of Oldco's rights, if any, in Intellectual
Property Oldco owns which is exclusively associated with Oldco's and/or Newco's
Battery Business. Registrations and applications to register Trademarks to be
so assigned or canceled include, but are not necessarily limited to, those
listed on Schedule 2(a)(i) attached hereto and incorporated by reference herein.
(ii) Anything in this Intellectual Property Agreement to the
contrary notwithstanding, Oldco will not assign to Newco any Intellectual
Property consisting of or containing the words, RALSTON, PURINA, CHOW,
CHECKERBOARD, or other word meaning "Checkerboard," the 9-Square Checkerboard or
other Checkerboard or Checkerband designs, any Intellectual Property consisting
of or containing any Intellectual Property now owned by any exclusively
non-Battery-Business Affiliate of Ralston, any Intellectual Property not
exclusively associated with Oldco's and/or Newco's Battery Business, or any
Intellectual Property confusingly similar to any of the Intellectual Property
comprehended by this Subparagraph 2(a)(ii). To the extent any such Intellectual
Property is currently owned by Newco, it will be assigned to Oldco or canceled
on or before Closing or at such date or dates thereafter as Oldco may elect.
(iii) All assignments contemplated by this Intellectual Property
Agreement will be on a quitclaim basis. The assignee will assume all
limitations, undertakings and liabilities related to such assigned Intellectual
Property, including, but not limited to, limitations in contracts relating to
such Intellectual Property entered into by the assignor and binding upon its
successors and/or assigns, and liability for any charge that any such
Intellectual Property infringes rights of any third party, without regard to
whether any such charge arises before or after Closing.
(iv) With respect to Intellectual Property to be assigned pursuant
to this Intellectual Property Agreement in cases where such property exists in
the name of a single owner in more than one jurisdiction, the assignor will
deliver to the assignee at or before Closing a beneficial, multi-jurisdiction
assignment of such Intellectual Property. The assignor shall thereafter
promptly execute and return to the assignee one or more jurisdiction-specific
assignments of such Intellectual Property prepared by the assignee and delivered
to the assignor for such purpose.
(v) With respect to Intellectual Property to be assigned pursuant
to this Intellectual Property Agreement in cases where all such property owned
by a single Affiliate exists in a single jurisdiction, the assignor will
promptly deliver to the assignee at or before Closing, or thereafter as
necessary, a jurisdiction-specific assignment of such property in recordable
form.
(vi) Intellectual Property which is to be assigned pursuant to
Subparagraph 2(a)(v) hereinabove, but which is not assigned at Closing, will be
maintained by its putative assignor for a reasonable period of time for the
benefit of the person to whom it is to be assigned; however, the putative
assignee shall reimburse the putative assignor for all out-of-pocket expenses
incurred for such maintenance.
(vii) Battery-Business-related Intellectual Property, whether or
not assigned hereunder, remains the responsibility of Newco; and Newco retains
such Intellectual Property subject to all limitations, undertakings and
liabilities related to such Intellectual Property, including, but not limited
to, undertakings in contracts relating to such Intellectual Property and
liability for any charge that any such Intellectual Property infringes rights of
any third party, without regard to whether such charge arises before or after
the Closing.
(viii) Non-Battery-Business-related Intellectual Property whether
or not assigned hereunder remains the responsibility of Oldco; and Oldco
retains such Intellectual Property subject to all limitations, undertakings
and liabilities related to such Intellectual Property, including, but not
limited to, undertakings in contracts relating to such Intellectual Property
and liability for any charge that any such Intellectual Property infringes the
rights of any third party, without regard to whether such charge arises
before the Closing.
(ix) At Closing, the parties will execute general Intellectual
Property Assignments in the form shown on Schedule 2(a)(ix)(A) and 2(a)(ix)(B)
Attached hereto and incorporated by reference herein.
(b) Costs of Assignment and Recordation
Oldco shall pay the costs (including attorneys' and accountants` fees,
costs and expenses) of preparing and recording jurisdiction-specific assignments
contemplated by Subparagraph 2(a)(v) above. Oldco shall pay the costs of
preparing and recording jurisdiction-specific assignments contemplated by
Subparagraph 2(a)(iv) above to the extent such costs relate to Trademarks for
which the Oldco assignor is record owner or for which an application to record
such Oldco assignor as record owner was pending more than one month prior to
Closing. Otherwise, such costs shall be borne by Newco.
An application to record shall be deemed pending if instructions to
record the same were sent to such Oldco assignor's attorneys or agents more than
one month prior to Closing. The parties agree that such instructions were sent
to record Energizer UK Company as record owner of Trademarks heretofore owned by
Ever Ready Limited in the jurisdictions listed in Schedule 2(b) hereto; however,
applications to record Energizer UK Company as record owner have not yet been
filed in such jurisdictions. Newco agrees that to the extent Newco does not
confirm its instructions to its outside attorneys or agents to record Energizer
UK Company's ownership of the Trademarks previously owned by Ever Ready Limited
(and, where required, that of Ever Ready Limited's predecessor(s)) in the
jurisdictions listed in Schedule 2(b) within three months following Closing,
then to the extent such failure to confirm such prior instructions results in
the need to record Energizer UK Company's name-change as a necessary step to
record assignments from Energizer UK Company to Energizer Limited, the costs to
record such name-change shall be borne by Newco.
3. Name Changes
(a) Newco Name Changes
Without limitation as to duration or territory, Newco agrees not to
use, register or maintain any Trademark, Trade Name, or other Intellectual
Property consisting of or containing the word RALSTON, PURINA, "Checkerboard,"
"Checkerboard Square," or any word, phrase, symbol or device confusingly similar
thereto, in connection with any product, service or activity. To the extent a
Newco Trademark or Trade Name consists of or contains the word "Ralston" or
other word, phrase, symbol, or device proscribed by this Subparagraph 3(a),
Newco will cancel or change such Trademark or Trade Name within six months
following Closing to eliminate such proscribed word, phrase symbol, or device.
(b) Oldco Name Changes
Without limitation as to duration or territory, Oldco agrees not to
use, register or maintain any Trademark, Trade Name or other Intellectual
Property consisting containing the word ENERGIZER, EVEREADY, EVER READY,
Energizer Bunny, or any word, symbol, or device confusingly similar thereto, in
connection with any product, service, or activity. To the extent an Oldco
Trademark or Trade Name consists of or contains the word ENERGIZER or other
word, phrase, symbol or device proscribed by this Subparagraph 3(b), Oldco will
cancel or change such Trademark or Trade Name within six months following
Closing to eliminate such proscribed word, phrase, symbol, or device.
(c) Costs of Name Changes
Oldco agrees to pay the costs (including attorneys` and accountants`
fees, costs and expenses) of name changes and cancellations required by
Paragraphs 3(a) and 3(b) above, including the cost, where necessary, of
recording the name change against Trademarks and recorded Trademark-related
agreements for which the company whose name is changed is record owner.
4. Costs, General
Except as otherwise provided in this Intellectual Property Agreement, Oldco
shall pay the costs (including attorneys` and accountants` fees, costs and
expenses) necessarily incurred to transfer, divide or cancel Intellectual
Property to the extent required by this Intellectual Property Agreement. Among
costs deemed necessarily incurred hereunder are (a) costs reasonably incurred to
the extent required by this Intellectual Property Agreement to cancel or replace
cancelled intellectual-property-related agreements between an Oldco company and
a Newco company with an equivalent agreement between two Newco companies, (b)
costs reasonably incurred to replace, modify or change
intellectual-property-related agreements between Newco Affiliates to the extent
required as a result of name changes required by this Intellectual Property
Agreement, (c) costs to record, where required by law, such new or modified
intellectual-property-related agreements and (d) costs to cancel Intellectual
Property in lieu of assignments otherwise required by this Intellectual Property
Agreement. Not included among costs deemed necessarily incurred hereunder are
(e) costs incurred in completing and/or recording assignments of Intellectual
Property from Ever Ready Limited to Energizer UK Company, and (f) any costs
resulting from Newco company name changes not required by this Intellectual
Property Agreement.
5. Third-Party Agreements
(a) To the extent assignable without third-party consent, and, if not,
to the extent such consent is obtained, at Closing, license agreements and other
contracts between Oldco and unaffiliated third parties, to the extent related to
the rights in Intellectual Property to be owned by Newco at Closing, will be
assigned from Oldco to Newco. Newco agrees to assume Oldco's obligations under
such agreements and to indemnify Oldco with respect to any of Newco's breaches
or failures to perform thereunder.
(b) To the extent assignable without third-party consent, and, if not,
to the extent such consent is obtained, at Closing, license agreements and other
contracts between Newco and unaffiliated third parties, to the extent related to
rights in Intellectual Property to be owned by Oldco at Closing, will be
assigned from Newco to Oldco. Oldco agrees to assume Newco's obligations under
such agreements and to indemnify Newco with respect to any of Oldco's breaches
or failures to perform thereunder.
6. Phase-Out of Intellectual Property Assigned to or Retained by Others
Newco agrees to remove all Oldco Intellectual Property not assigned to
Newco as well as Intellectual Property assigned from Newco to Oldco, from
Newco's labels, packaging, advertising, signs, letterhead, business cards, and
other materials within six (6) months following Closing. Oldco agrees to remove
all Intellectual Property assigned to Newco from Oldco's labels, packaging,
advertising, signs, letterhead, business cards, and other materials within the
same six (6) month period.
7. Heritage
Oldco, Newco and their successors and assigns, will each be allowed to
refer to its or their pre-spin-off heritage in good faith in truthful articles,
histories and the like to the extent such references do not express or imply a
continuing relationship between Oldco and Newco.
8. Good Faith
The parties agree not to do indirectly, through subsidiaries, Affiliates or
otherwise, what they could not do directly under this Intellectual Property
Agreement.
9. Scope and Modification
This Intellectual Property Agreement, including its schedules, sets forth
the entire agreement between the parties relating to the subject matter hereof
and it supersedes all prior agreements and understandings relating to such
subject matter. None of the terms of this Intellectual Property Agreement may
be waived or modified except as expressly agreed to, in writing, by both
parties.
10. Successors and Assigns
This Intellectual Property Agreement shall be binding upon and inure to the
benefit of the parties and each of their successors and assigns.
11. Interpretation
The section headings in this Intellectual Property Agreement are solely for
the purpose of reference, are not part of the agreement of the parties hereto,
and shall not in any way affect the meaning or interpretation of this
Intellectual Property Agreement.
12. Counterparts
This Intellectual Property Agreement may be executed in two or more
counterparts, each of which may be deemed an original, but all of which together
shall constitute one and the same instrument.
13. Governing Law
This Intellectual Property Agreement is made and entered into, and shall be
governed by and construed and interpreted in accordance with the laws of the
State of Missouri, United States of America, without regard to its conflicts of
laws principles, as to all matters, including those relating to validity,
construction, performance, effect and remedies under this Intellectual Property
Agreement. All matters relating to this Intellectual Property Agreement shall
be adjudicated exclusively in the courts of the State of Missouri located in St.
Louis, Missouri, or in the United States District Court for the Eastern District
of Missouri; and each party hereto consents to the exclusive jurisdiction and
venue of such courts for all such matters.
14. Amendment and Modification; Non-Waiver
This Intellectual Property Agreement may be amended, modified or
supplemented, or rights, powers or options thereunder waived or impaired,
only by a written agreement signed by an officer of Ralston and Energizer.
Neither party shall be deemed to have waived or impaired any right, power or
Option created or reserved by this Intellectual Property Agreement
(including without limitation, each party's right to demand compliance with
every term herein, or to declare any breach a default and exercise its rights in
accordance with the terms hereof) by virtue of: (i) any custom or practice of
the parties at variance with the terms hereof; (ii) any failure, refusal or
neglect to exercise any right hereunder, or to insist upon compliance with any
term; (iii) any waiver, forbearance, delay, failure or omission to exercise
any right or option, whether of the same, similar, or different natures, under
this Intellectual Property Agreement or in any other circumstances; or (iv)
the acceptance by either party of any payment or other consideration from the
other following any breach of this Intellectual Property Agreement. The
rights and remedies set forth in this Intellectual Property Agreement are
in addition to any other rights or remedies which may be granted by law.
15. Additional Documents
The parties agree to execute such additional documents as may be reasonably
required to give effect to their undertakings in this Intellectual Property
Agreement.
IN WITNESS WHEREOF, the parties have executed this Intellectual Property
Agreement as of the date first above written.
RALSTON PURINA COMPANY ENERGIZER HOLDINGS, INC.
By:/s/ James R. Elsesser By:/s/ Harry Strachan
Title: Vice President & Chief Financial Title: Vice President & General
Officer Counsel
Index of Schedules to Intellectual Property Agreement
Schedule 2(a)(i) Oldco Trademark Applications and Registrations
to be assigned to Newco or cancelled
Schedule 2(a)(ix)(A) General Intellectual Property Assignment
Schedule 2(a)(ix)(B) General Intellectual Property Assignment
Schedule 2(b) Jurisdictions in which the Parties agree that
instructions were sent to record Energizer UK
Company as record owner of Trademarks heretofore
Owned by EverReady Limited