EXECUTION COPY
OMNIBUS AGREEMENT (this "Agreement") dated as of September 30, 2004, by and
among Wyeth Holdings Corporation (formerly known as American Cyanamid Company),
a Maine corporation ("WH"), MDP Holdings, Inc., a Delaware corporation and a
wholly-owned subsidiary of WH ("MDP"), and Cytec Industries Inc., a Delaware
corporation ("CYTEC").
WHEREAS, WH and CYTEC previously entered into that certain Transfer and
Distribution Agreement dated December 17, 1993 (as amended to date, the "TDA"),
which provided for the spin-off of CYTEC from WH (the "Spin-Off");
WHEREAS, pursuant to the TDA, CYTEC issued 4,000 shares of CYTEC's Series C
Cumulative Preferred Stock (the "Series C Preferred), all of which are now owned
beneficially and of record by MDP;
WHEREAS, WH previously granted CYTEC certain waivers and consents under the
TDA and the Series C Preferred in that certain Preferred Stock Repurchase
Agreement dated as of August 17, 1995, as amended, that certain Transfer and
Distribution Agreement Amendment dated as of April 8, 1997, and that certain
Transfer and Distribution Agreement Second Amendment dated as of January 22,
1999, which waivers and consents remain in full force and effect after the
execution and delivery of this Agreement except to the extent explicitly amended
hereby;
WHEREAS, pursuant to the TDA, WH and CYTEC previously entered into that
certain Environmental Matters Agreement dated as of December 17, 1993 (as
amended to date, the "EMA") and that certain OPEB Matters Agreement dated as of
December 17, 1993 (the "OPEB Matters Agreement"); and
WHEREAS, WH and CYTEC wish to amend the TDA, the EMA and the OPEB Matters
Agreement and provide for certain other agreements between them, and MDP wishes
to sell to CYTEC, and CYTEC wishes to purchase from MDP, all of the Series C
Preferred, all upon the terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, WH and CYTEC (and, with respect to
Section 7 and 8 below only, MDP) hereby agree as follows:
1. Amendments to TDA. Section 6.12 Financial Covenants of the TDA is amended
to read in full as follows: "Section 6.12 Intentionally Omitted."
2. Insurance Claims.
(a) Defined Terms. The term "▇▇▇▇▇▇ Insurance Claims" shall mean Insurance
Claims under insurance policies to the extent ▇▇▇▇▇▇ Insurance Company and its
predecessors, successors, assigns and Affiliates (collectively, "▇▇▇▇▇▇") have
any actual exposure, whether as a direct, primary, or excess insurance carrier,
indirectly as a result of "re-insurance" or other arrangements with WH or its
Affiliates or their respective other insurance carriers, or otherwise. The term
"Non-▇▇▇▇▇▇ Insurance Claims" shall mean Insurance Claims other than ▇▇▇▇▇▇
Insurance Claims.
(b) Assigned Claims. To the extent (i) assignable under the terms of the
applicable insurance policies and applicable law, (ii) not previously assigned
to CYTEC pursuant to the Assignment of Environmental Insurance Claims and the
Assignment of Specified Insurance Claims, each dated as of December 17, 1993
(the "Claims Assignments") and (iii) not previously released by the WH Parties
under settlements of litigation or otherwise, WH hereby assigns to CYTEC all
Non-▇▇▇▇▇▇ Insurance Claims, known or unknown, that relate exclusively to
Assumed Liabilities and that do not relate in any respect to Assumed
Environmental Liabilities (as defined in the EMA) or Retained Liabilities (the
"Assigned Claims"). For the avoidance of doubt, Assumed Liabilities for personal
injury or products liability arising from exposure to asbestos or
asbestos-containing products or exposure to any other chemical in the workplace
environment or to any product manufactured by WH and sold in the ordinary course
of business, including without limitation lead pigment are not Assumed
Environmental Liabilities for purposes of this Section 2(b). At least forty-five
(45) days before pursuing any Insurance Claims that CYTEC believes qualify as
Assigned Claims, CYTEC shall notify WH of its intention to pursue such Insurance
Claims and provide sufficient supporting information to afford WH a reasonable
opportunity to confirm that such claims so qualify. If, after reviewing such
notice and supporting information in good faith during such forty-five (45) day
period, WH determines in its reasonable discretion that any or all of such
Insurance Claims do not qualify as Assigned Claims, WH shall so notify CYTEC and
such determination shall be binding on CYTEC.
(c) Additional Claims. From time to time, CYTEC may request of WH in
writing (each, a "Request Letter") that WH assign to CYTEC any ▇▇▇▇▇▇ Insurance
Claim that relates exclusively to Assumed Liabilities and that does not relate
in any respect to Assumed Environmental Liabilities (as defined in the EMA) or
Retained Liabilities (each, an "Additional Claim"). Each Request Letter shall
specify in detail the matters underlying the Additional Claim, the insurance
policy or policies affected, the insurance carrier or carriers involved, a bona
fide estimate of the maximum amount of such Additional Claim, if feasible, and
the proposed allocation of such Additional Claim across the affected insurance
policies. Within sixty (60) days of receipt of any Request Letter, WH shall
determine in good faith whether the Additional Claim (assuming full recovery) is
reasonably likely to cause an adverse effect on the Wyeth Parties (as defined in
Section 2(d) below) (an "Adverse Effect"); it being understood that, as long as
(x) CYTEC is in full compliance with its obligations under this Agreement
(including this Section 2) and the TDA and Related Agreements and (y) solely
with respect to clause (i) below, the senior long term debt of CYTEC is rated at
least BB or higher by S&P or Ba or higher by Moodys, neither (i) the fact that
▇▇▇▇▇▇ has any obligation or exposure with respect to the Assigned Claim, nor
(ii) the projected reduction in the aggregate amount of coverage remaining under
the Insurance Program as an entirety in the amount of the Assigned Claim, shall
be considered, in isolation, an Adverse Effect.
2
Subject, in the case of any Additional Claim that WH determines is
reasonably likely to cause an Adverse Effect, to WH and CYTEC reaching agreement
on a structure pursuant to the immediately following paragraph, WH shall, at its
sole option, either:
(i) assign the Additional Claim to CYTEC to the extent (i) assignable
under the terms of the applicable insurance policies and applicable
law, (ii) not previously assigned to CYTEC pursuant to the Claims
Assignments and (iii) not previously released by the Wyeth Parties; or
(ii) use its commercially reasonable efforts, with the reasonable
participation and cooperation of CYTEC at CYTEC's sole cost and
expense, to directly pursue such Additional Claim against the
applicable insurance policies;
provided, however, that WH shall not elect clause (ii) with respect to any
Insurance Claim set forth on Schedule D hereto.
With respect to any Additional Claim that WH determines is reasonably
likely to cause an Adverse Effect, WH shall deliver to CYTEC written notice
of such determination and CYTEC and WH shall commence good faith
negotiations toward a mutually agreeable structure pursuant to which CYTEC
(or WH, on behalf of Cytec) may pursue recovery against the affected
insurance policies for such Additional Claim without any risk of an Adverse
Effect on the Wyeth Parties, which structure may include, among other
things, CYTEC depositing funds into escrow, or posting a letter of credit,
for the benefit of the Wyeth Parties to secure the rights of the Wyeth
Parties under Section 2(d) or Section 2(e) below.
(d) Allocation of Proceeds. The gross proceeds recovered by CYTEC (or by
WH, on behalf of CYTEC) in respect of an Assigned Claim or an Additional Claim,
whether recovered as payments under the affected insurance policies or through
settling or compromising such Assigned Claim or such Additional Claim or
otherwise ("Proceeds"), shall be for the account of CYTEC, except that CYTEC
shall pay to WH, or WH shall retain, as the case may be, from such Proceeds an
amount equal to the sum of: (i) all payments made by ▇▇▇▇▇▇ in respect of such
Assigned Claim or such Additional Claim, including without limitation any
payments made by ▇▇▇▇▇▇ in respect of insurance policies or "re-insurance" or
other arrangements relating to insurance policies ("▇▇▇▇▇▇ Payments"), (ii)
without duplication with clause (i) above, all Losses (as defined in Section
2(e) below) incurred or suffered by the Wyeth Parties as a result of, arising
out of or directly or indirectly relating to such Assigned Claim or such
Additional Claim that, absent this Section 2(d), would be subject to
indemnification under Section 2(e) below, and, only in the case of an Additional
Claim, (iii) 10% of the Proceeds remaining after subtracting the amounts in
clauses (i) and (ii) (collectively, the "Wyeth Portion"). To the extent
practicable, CYTEC shall give WH no less than thirty (30) days notice of each
expected receipt of Proceeds, so that WH can provide CYTEC with its calculation
of the amount, if any, referred to in clause (ii) above. Upon CYTEC's receipt of
any
3
Proceeds, CYTEC shall immediately notify WH in writing of such receipt and remit
the Wyeth Portion to WH; provided, that if CYTEC has not yet received WH's
calculation of the amount, if any, referred to in clause (ii) above, CYTEC shall
instead immediately remit to WH such portion of the Wyeth Portion as may be
calculated without such calculation and, upon receipt of such calculation, shall
immediately remit the remaining amount of the Wyeth Portion to WH. Within thirty
(30) days following the last day of each calendar quarter, CYTEC shall deliver
to WH a certification of the Chief Financial Officer of CYTEC as to the amount
of all Proceeds received during such quarter and the calculation of the Wyeth
Portion with respect to such Proceeds. Upon WH's receipt of any Proceeds on
behalf of CYTEC, WH shall immediately notify CYTEC in writing of such receipt
and remit such Proceeds, net of the Wyeth Portion, to CYTEC. In the event that
CYTEC expects to receive Proceeds in respect of which ▇▇▇▇▇▇ will incur ▇▇▇▇▇▇
Payments, CYTEC shall notify WH thereof and cooperate with WH in order to
facilitate WH's direct receipt of the ▇▇▇▇▇▇ Payments from ▇▇▇▇▇▇. In the event
that as of the time of any receipt of Proceeds by CYTEC or WH, the amount
referred to in clause (ii) has not been agreed by CYTEC and WH, the Wyeth
Portion shall be calculated based on WH's calculation, but CYTEC shall retain
the right to pursue any amount of the Wyeth Portion in dispute in accordance
with the dispute resolution procedures set forth in the TDA. In the event that
CYTEC fails to cure any breach by it of the provisions of this Section 2(d)
within ten (10) days following written notice thereof from WH, in addition to
the remedies available to WH under this Agreement (including without limitation
Section 2(e)) and otherwise under applicable law, the assignment hereby of the
Assigned Claims and any Additional Claims shall be deemed suspended and CYTEC
shall have no further ability to prosecute the Assigned Claims and any
Additional Claims until such time as such breach is cured to the reasonable
satisfaction of WH.
(e) Indemnification by CYTEC.
(i) CYTEC will indemnify and hold harmless WH and its Affiliates (including
▇▇▇▇▇▇) and their respective directors, officers, employees and
representatives (collectively, the "Wyeth Parties" and each, for purposes
of this Section 2(e), a "Wyeth Indemnified Party") from, against and in
respect of any and all claims, actions, causes of action or suits (whether
in contract or tort or otherwise), litigation (whether at law or in equity,
whether civil or criminal), controversies, assessments, arbitrations,
investigations, hearings, charges, complaints, demands, notice or
proceedings, Liabilities (including without limitation payments by ▇▇▇▇▇▇
in respect of insurance policies or "re-insurance" or other arrangements
relating to insurance policies), damages, bonds, dues, assessments, fines,
penalties, Taxes, fees, costs (including costs of investigation, defense
and enforcement of this Agreement), expenses or amounts paid in settlement
(in each case, including out-of-pocket reasonable attorneys' and experts
fees and expenses), whether or not involving a Third Party Claim (as
defined below) (collectively, "Losses"), incurred or suffered by a Wyeth
Indemnified Party as a result of, arising out of or directly or indirectly
relating to (x) any Assigned Claim (whether due to any mistaken
classification of a ▇▇▇▇▇▇ Insurance Claim as a Non-▇▇▇▇▇▇ Insurance Claim
or otherwise) or any
4
Additional Claim, in each case including the assignment thereof to
CYTEC, CYTEC's pursuit thereof, or WH's prosecution thereof at CYTEC's
request, (y) any other Insurance Claim under the Insurance Program as
to which CYTEC seeks or receives any recovery after the date hereof or
(z) any breach or violation of any covenant or agreement of CYTEC
(including without limitation under this Section 2(e)) in or pursuant
to this Section 2. For the avoidance of doubt, (x) to the extent (and
only to the extent) that CYTEC has timely remitted the Wyeth Portion
of any Proceeds to WH, or WH has retained the Wyeth Portion of any
Proceeds, in accordance with Section 2(c), any ▇▇▇▇▇▇ Payments and
other Losses of the Wyeth Parties included in the calculation of the
Wyeth Portion shall not be subject to indemnification under this
Section 2(e), and (y) for purposes of this Section 2(e), the phrase
"as a result of, arising out of or directly or indirectly relating to"
(i) shall include Losses of ▇▇▇▇▇▇ in respect of insurance policies or
"re-insurance" or other arrangements relating to insurance policies,
which, absent CYTEC's prior recoveries under other insurance policies,
would not have been incurred by ▇▇▇▇▇▇, and (ii) shall not include
Losses of the Wyeth Parties (other than ▇▇▇▇▇▇) that result from the
unavailability of insurance coverage for an Insurance Claim due to the
exhaustion of the aggregate limits of the portions of the Insurance
Program applicable to such Insurance Claim .
(ii) If any third party notifies the Wyeth Indemnified Party with respect to any
matter (a "Third Party Claim") which may give rise to Losses, then the
Wyeth Indemnified Party will promptly give written notice to CYTEC;
provided, however, that no delay in notifying CYTEC will relieve CYTEC from
any obligation under this Section 2.
(iii)CYTEC will be entitled to participate at its sole cost and expense in the
defense of any Third Party Claim that is the subject of a notice given by
the Wyeth Indemnified Party pursuant to Section 2(e)(ii). However, the
Wyeth Indemnified Party may defend, and may (after consultation with CYTEC)
consent to the entry of any judgment or enter into any compromise or
settlement with respect to, the Third Party Claim in any manner it may
reasonably deem appropriate. CYTEC will (x) advance the Wyeth Indemnified
Party promptly and periodically for the Wyeth Indemnified Party's costs of
defending against the Third Party Claim (including reasonable attorneys'
fees and expenses) and (y) remain responsible for any and all other Losses
that the Wyeth Indemnified Party may incur or suffer resulting from,
arising out of, relating to, in the nature of or caused by the Third Party
Claim to the fullest extent provided in this Section 2. CYTEC hereby
consents to the non-exclusive jurisdiction of any court in which any Third
Party Claim may brought against any Wyeth Indemnified Party for purposes of
any claim which such Wyeth Indemnified Party may have against CYTEC
pursuant to this Agreement in connection with such Third Party Claim.
5
(iv) The rights of each Wyeth Indemnified Person under this Section 2(e) are
cumulative with the rights of such Wyeth Indemnified Person under the TDA
and Related Agreements. Each Wyeth Indemnified Person, as the case may be,
will have the right in any particular circumstance, in its sole discretion,
to enforce any provision of this Section 2(e) without regard to the
availability of a remedy under any other provision of this Agreement, the
TDA and the Related Agreements.
(f) Insurance Working Group. Cytec shall establish and provide adequate
support for an insurance working group (the "Insurance Working Group") that
shall meet no less than one time per calendar quarter and review all Insurance
Claims under the Insurance Program as to which CYTEC has sought, is seeking or
plans to seek any recovery (the "CYTEC Insurance Claims"). The Insurance Working
Group shall be comprised of at least one insurance professional and one legal
professional employed by CYTEC and one or two persons as WH in its sole
discretion may designate. CYTEC shall provide the WH representative(s) to the
Insurance Working Group with full access to any and all information relating to
the CYTEC Insurance Claims. Without limiting the preceding sentence, not less
than thirty (30) days prior to any scheduled meeting of the Insurance Working
Group, Cytec shall provide to the WH representative(s) to the Insurance Working
Group an agenda and a report containing at least the following information (to
the extent reasonably available) with respect to each of the CYTEC Insurance
Claims:
(i) CYTEC's understanding as to whether and pursuant to what document WH has
assigned the rights to such CYTEC Insurance Claim to CYTEC and, to the
extent not so assigned, whether CYTEC intends to request such an assignment
under Section 2(b) above;
(ii) a schedule of the affected insurance carriers and insurance policies in
respect of such CYTEC Insurance Claim, including but not limited to the
amount claimed or to be claimed against individual policies and the total
paid and reserved for such CYTEC Insurance Claim and in the aggregate for
each affected insurance policy and carrier;
(iii)a description of the legal status of the matters underlying such CYTEC
Insurance Claim; and
(iv) copies of any correspondence from insurance carriers that set forth a
coverage position on such CYTEC Insurance Claim.
Each such report shall also include a schedule reflecting the aggregate
erosion of the Insurance Program relating to CYTEC Insurance Claims. CYTEC will
promptly advise WH of any significant developments regarding any CYTEC Insurance
Claim that could increase the amount paid under the Insurance Program in respect
of such CYTEC Insurance Claim by more than $2 million. CYTEC also will promptly
inform WH of any other issues relating to the Insurance Program that come to
CYTEC's attention and which would be reasonably expected to adversely affect the
Wyeth Parties. CYTEC and WH will cooperate and coordinate with each other to
maintain a schedule reflecting the aggregate erosion of the Insurance Program.
6
(g) Asserted Claims. Within one hundred and twenty (120) days following the
date of this Agreement, CYTEC shall provide WH with a schedule of all Insurance
Claims under the Insurance Program as to which CYTEC has given notice to the
affected insurance carriers prior to the date of this Agreement ("Asserted
Claims"). The schedule provided shall specify for each Asserted Claim the
information required by Section 2(f) to be provided by CYTEC to the Insurance
Working Group with respect to CYTEC Insurance Claims. The schedule provided
shall further specify whether each such Asserted Claim: (i) has been previously
assigned to CYTEC, (ii) was assigned to CYTEC pursuant to Section 2(b), (iii) is
or may be the subject of a Request Letter pursuant to Section 2(c), or (iv) is
not described in clauses (i)-(iii).
(h) Notification of Insurers. Nothing in this Section 2 shall be deemed to
restrict CYTEC from providing notice of any Assigned Claim or Additional Claim
to any insurer under the Insurance Program without the prior approval of WH,
provided that CYTEC provides WH a copy of such notice.
(i) Commutation, etc. The Wyeth Parties shall be free to enter into any
agreement (including without limitation any buy-out or commutation agreement)
following the date hereof, regarding any insurance policy under the Insurance
Program; provided, however, that, if such agreement would extinguish or
otherwise adversely affect CYTEC's rights to coverage or potential coverage
pursuant to Insurance Claims that have been assigned or are potentially
assignable to CYTEC pursuant to this Agreement or have been assigned to CYTEC
pursuant to the Claims Assignments, the Wyeth Parties shall give CYTEC at least
thirty (30) days prior notice of such agreement and shall negotiate in good
faith with CYTEC to provide for a fair and reasonable allocation of any proceeds
under such agreement as between the Wyeth Parties, on the one hand, and CYTEC,
on the other, given their respective pending claims and known potential claims
under the affected insurance policies.
(j) Cooperation. WH shall use commercially reasonable efforts to cooperate
with CYTEC and shall provide CYTEC, upon request, with such information (to the
extent reasonably available to WH) as may be reasonably necessary (including
without limitation copies of insurance and "re-insurance" policies and
correspondence) in connection with CYTEC's pursuit of insurance coverage for
Assigned Claims under Section 2(b) above and Additional Claims under Section
2(c)(i) above.
(k) Other Provisions. CYTEC acknowledges and agrees that the Wyeth Parties
are not making any representation or warranty of any kind with respect to the
validity of the assignment of Assigned Claims or Additional Claims in or
pursuant to this Section 2. No assignment in or pursuant to this Section 2 shall
be construed to effect a substitution of CYTEC as the named insured under any
insurance policy, or to effect an assignment of any insurance policy in its
entirety that was originally purchased by the Wyeth Parties. This Section 2 is
not intended to confer, and does not confer, a benefit upon any insurance
carrier (other than ▇▇▇▇▇▇), or upon any other third party (other than CYTEC)
that owes or may owe to the Wyeth Parties an obligation to make payments to
contribute to satisfy any Losses, in whole or in part.
7
3. Amendments to EMA.
------------------
(a) Article IV of the EMA is hereby further amended to read in full as
follows:
"ARTICLE IV
ESTABLISHMENT OF ENVIRONMENTAL WORKING GROUP
4.1 Environmental Working Group. Cytec shall establish and provide adequate
support for an environmental working group (the "Environmental Working
Group") which shall meet no less than twice per year to review (i) Cytec's
compliance with Environmental Laws; (ii) the nature and status of all
Remediation and Potential Remediation, and amounts expended and expected to
be expended for such activities; (iii) the nature, status and accrual of
any environmental reserves for any Assumed Environmental Liabilities; (iv)
Cytec's policies and practices regarding asbestos removal, the nature and
status of any ongoing or proposed asbestos removal activities and the
nature and status of asbestos exposure claims against Cytec; (v) the nature
and status of any lead pigment exposure claims against Cytec and (vi) any
individual environmental matter, lawsuit, proceeding, claim, action or
issue that would be reasonably likely to subject Cytec to liability in
excess of $5,000,000 or otherwise be materially injurious to Cytec's
reputation or goodwill (the matters identified in clauses (i) - (vi),
collectively, the "Working Group Matters"). The Environmental Working Group
shall be comprised of environmental professionals employed by Cytec and one
or two persons as ACY in its sole discretion may designate, after
consultation with Cytec. In the event that, after consultation with the
Cytec representatives on the Environmental Working Group, the ACY
representatives on the Environmental Working Group have concerns regarding
the manner in which Cytec is addressing or proposing to address any
material Working Group Matters, ACY shall have the right to prepare and
deliver to Cytec a written report documenting such concerns and Cytec shall
promptly share any such report so delivered with the Environmental, Health
and Safety Committee of its Board of Directors or, if such committee is no
longer in existence, the Audit Committee of its Board of Directors. The
Environmental Working Group shall have full and free access to Cytec
documents, records and personnel to the extent reasonably required to
review the Working Group Matters, provided that Cytec shall not, until it
has entered into an applicable joint legal representation agreement with
ACY pursuant to Section 5.3 hereof, be required to disclose to the
Environmental Working Group materials protected as attorney work product or
by the attorney-client privilege."
8
(b) Section 5.1 of the EMA is hereby amended to read in full as follows:
"5.1 Required Reports. No later than 30 days prior to the date of each
meeting of the Environmental Working Group, Cytec shall submit to ACY a
report describing in reasonable detail the Working Group Matters to be
reviewed by the Environmental Working Group at such meeting pursuant to
Section 4.1, which report shall include a similar scope and depth of
information as traditionally has been included in the semi-annual
environmental reports prepared pursuant to this Agreement prior to
September 30, 2004."
(c) Article XI of the EMA is hereby amended to read in full as follows:
"ARTICLE XI Intentionally omitted".
4. Amendment to OPEB Matters Agreement.
------------------------------------
(a) The third paragraph of clause (B) of Section 1.1 of the OPEB Matters
Agreement is hereby amended to read in full as follows:
"All such liabilities or obligations for (i) the Post-Retirement Benefits as to
which Transferred Retirees are entitled as of the Effective Date (or, in the
case of Transferred Retirees described in clause (ii) of Section 1.3(b) hereof,
the Post-Retirement Benefits for which such Transferred Retirees are eligible as
of the date of their respective retirements from ACY); or (ii) the
Post-Retirement Benefits as to which each Transferred Employee who becomes an
employee of Cytec as of the Employee Transfer Date and, immediately prior to the
Employee Transfer Date, is eligible for Post-Retirement Benefits under any of
ACY's plans or policies, as in effect from time to time were such Transferred
Employee to terminate employment immediately prior to the Effective Date, are
herein called the "OPEB Liabilities."
(b) Section 1.2 of the OPEB Matters Agreement is hereby amended to read in full
as follows:
"Compliance with Law; Changes in Benefits. Cytec agrees that it will comply with
all applicable laws with respect to OPEB Liabilities including all federal and
state laws such as the Employee Retirement Income Security Act of 1974 ("ERISA")
and rules and regulations and pronouncements promulgated by state and federal
regulatory agencies such as the federal Department of Labor, Internal Revenue
Service and the Pension Benefit Guaranty Corporation. For purposes of this
paragraph and Section 2.1 below, the term "OPEB Liabilities" shall include any
and all Liabilities arising out of any proposed or actual change by Cytec in the
Post-Retirement Benefits to which Transferred Retirees or Transferred Employees
are eligible, which Liabilities shall in no event be deemed to arise out of the
fault or neglect of ACY for purposes of Section 2.1 below."
9
5. Allocation of Certain Liabilities.
(a) CYTEC hereby acknowledges and agrees that any and all Losses relating
to WH's ownership of an interest in the Jefferson Chemical Company ("Jefferson")
or its provision of industrial hygiene services to the Jefferson Chemical
Company are Assumed Liabilities of CYTEC under the TDA, and are not Retained
Liabilities under the TDA. Without limiting the generality of the foregoing,
CYTEC hereby acknowledges and agrees that any and all Losses relating to claims
brought against Wyeth Parties at any time alleging personal injury or any other
harm arising from alleged exposure to any chemicals (including, but not limited
to, benzene or asbestos) at any facility or site of Jefferson or alleging
personal injury or any other harm arising from alleged exposure to asbestos at
the Bound Brook facility or site in New Jersey ("Bound Brook"), under any theory
of liability, are Assumed Liabilities of CYTEC under the TDA, and are not
Retained Liabilities under the TDA; it being understood that this Section 5(a)
does not purport to address allocation of responsibility for personal injury or
any other harm arising from alleged exposure at Bound Brook to any chemicals
other than asbestos.
(b) CYTEC hereby withdraws, with prejudice, the letter dated December 19,
2003 from ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq. of CYTEC to ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq. of
Wyeth, relating to CYTEC's obligations for defense and indemnification of Wyeth
Parties in connection with benzene and asbestos personal injury claims arising
from alleged exposures at any facility or site of Jefferson and at Bound Brook.
CYTEC agrees that it will not re-advance or pursue in any manner or forum (i)
any of its contentions asserted in the December 19, 2003 letter to Wyeth (other
than general contentions as to the interpretation of the TDA and Related
Agreements to the extent that such contentions do not relate to allocation of
specific liabilities among the parties and not inconsistent with this
Agreement), and (ii) any contention that CYTEC's agreements with WH in
connection with the Spin-Off are "contracts of adhesion" or otherwise are not
enforceable in any respect. CYTEC acknowledges that it has, and at all times
from and after the effective date of the TDA has had, responsibility to defend
and indemnify the Wyeth Parties in respect of the personal injury claims and
cases referred to in the December 19, 2003 letter.
(c) Without limiting the generality of the foregoing, CYTEC agrees that its
obligation to defend and indemnify the Wyeth Parties also includes, without
limitation, all claims asserted against WH in the case entitled ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
v. ▇.▇. ▇▇▇▇▇, et al., now pending in New York State Court.
(d) As to all personal injury actions asserting liability against Wyeth
Parties for personal injury resulting from alleged exposure to benzene or
asbestos relating to Jefferson, Port Neches or Bound Brook which CYTEC either
refused to accept for purpose of defense and indemnification following the
December 19, 2003 letter, or returned to Wyeth after they were tendered to
CYTEC:
10
(i) CYTEC acknowledges its duty to defend, indemnify and hold harmless the
Wyeth Parties for each and all such cases;
(ii) CYTEC agrees to take over the defense of such cases as promptly as
possible; and
(iii)CYTEC agrees to promptly reimburse the Wyeth Parties for all out-of-pocket
legal fees and costs reasonably incurred by the Wyeth Parties in connection
with all cases which CYTEC either returned to Wyeth after they were
tendered, or otherwise declined to defend.
6. Bound Brook Worker's Compensation Liabilities. Without limiting CYTEC's
responsibilities under any other provision of this Agreement or the TDA and
Related Agreements in any respect, CYTEC acknowledges and agrees that any and
all Losses of the WH Parties relating to "self-insured," "deductible" or other
portions (as to which WH has not received and is not entitled to receive any
recovery pursuant to "re-insurance" or similar arrangements or excess insurance
policies) of WH's workers' compensation insurance policies covering claims at
Bound Brook with a "loss date" for insurance purposes prior to January 1, 1986
(collectively, "Self-Insurance Losses") are Assumed Liabilities of CYTEC under
the TDA, and are not Retained Liabilities under the TDA. On the date of this
Agreement, CYTEC shall pay WH $1,623,957 in cash by wire transfer of same day
funds as set forth on Schedule A to this Agreement, which represents full
settlement as between CYTEC and the WH Parties for Self-Insurance Losses paid by
WH following the Spin-Off and prior to September 24, 2004. CYTEC agrees to
promptly pay future invoices from WH (supported by reasonable documentation)
seeking reimbursement from CYTEC for Losses paid following September 24, 2004 in
respect of Self-Insurance Losses. To the best of WH's knowledge, the claims
listed on Schedule C represent the only open claims in respect of Self-Insurance
Losses. WH agrees to turn over the claims files of all claims listed on Schedule
C promptly after the date of this Agreement. From and after the date of this
Agreement, Cytec shall assume responsibility for the administration and control
of the workers' compensation insurance claims relating to occurrences at Bound
Brook with a "loss date" for insurance purposes prior to January 1, 1986, and
shall advise WH of significant settlements, awards or any other payments that
could effect the policies sold to WH by the insurance carriers.
7. Purchase and Sale of Series C Preferred. MDP hereby sells, and CYTEC
hereby purchases, the Series C Preferred for an aggregate purchase price of
$10,000,000 (TEN MILLION DOLLARS) (the "Purchase Price"), payable on October 1,
2004. CYTEC shall pay the Purchase Price in cash to MDP by wire transfer of same
day funds as set forth on Schedule B to this Agreement, and MDP shall deliver to
CYTEC the share certificates for the Series C Preferred, duly endorsed for
transfer to CYTEC.
8. Representation and Warranties.
------------------------------
11
(a) Each of WH and MDP represents and warrants to CYTEC, and CYTEC hereby
represents and warrants to each of WH and MDP, as follows: (i) this Agreement
has been duly authorized, executed and delivered by such party and constitutes a
legal, valid and binding agreement of such party, except as the same may be
limited by bankruptcy, insolvency, moratorium, reorganization or other laws of
general applicability relating to or affecting the enforcement of creditors'
rights and general principles of equity; (ii) the execution and delivery of this
Agreement, and the performance hereof, does not constitute a violation of, or a
default under, the certificate of incorporation or by-laws of such party or
under any indenture, trust, credit agreement, mortgage, preferred stock series
or other material agreement by which such party or its properties is bound or
affected, or conflict with or violate in any material respect any law, rule,
regulation, order, judgment or decree applicable to it or by which any of its
properties are bound or affected; (iii) such party has all necessary corporate
power and authority to execute and deliver this Agreement, to perform its
obligations hereunder and to consummate the transactions contemplated hereby;
(b) MDP represents and warrants to CYTEC that it has a good and lawful
right to sell the Series C Preferred to CYTEC as provided herein, and that such
sale, when made hereunder, shall be free and clear of all liens, claims,
encumbrances and other rights of third parties.
9. Miscellaneous.
--------------
(a) Notices. All notices, requests, demands and other communications under
this Agreement shall be in writing and shall be deemed to have been
duly given,
(i) On the date of service if served personally on the party to whom
notice is given,
(ii) On the day of transmission if sent via facsimile transmission,
provided telephonic confirmation of receipt if obtained promptly
after completion of transmission,
(iii)On the business day after delivery to an overnight courier
service or the Express mail service maintained by the United
States Postal Service, provided receipt of delivery has been
confirmed, or
(iv) On the fifth day after mailing, provided receipt of delivery is
confirmed, if mailed to the party to whom notice is to be given,
by first class mail, registered or certified, postage prepaid,
properly addressed and return receipt requested to the party as
follows:
If to CYTEC:
Cytec Industries Inc.
▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Secretary
12
If to WH:
Wyeth Holdings Corporation
▇/▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
If to MDP:
MDP Holdings, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Vice President
Any party may change its address by giving the other parties
written notice of its new address in the manner set forth above.
(b) Descriptive Headings. The descriptive headings of the several sections
of this Agreement are inserted for reference only and shall not limit or
otherwise affect the meaning hereof.
(c) Governing Law. Except for the Series C Preferred, which is governed by
Delaware law, this Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of New Jersey.
(d) Counterparts. This Agreement may be executed simultaneously in any
number of counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
(e) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstances, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions contained herein shall not be in any way impaired
thereby. In such event, the parties shall negotiate in good faith toward mutual
agreeable substitute provisions that are not subject to such legal defect so as
to replicate, as closely as possible, the intent and effect of the original
provisions.
(f) Entire Agreement. This Agreement is intended by the parties hereto as a
final and complete expression of their agreement and understanding in respect to
the subject contained herein. This Agreement supersedes all prior agreements and
understandings, written or oral, between the parties, other than as provided in
the third WHEREAS clause of this Agreement, with respect to such subject matter.
13
(g) Amendment. This Agreement may not be amended except by a written
instrument executed by the parties hereto.
(h) No Third Party Beneficiaries. Nothing in this Agreement shall convey
any rights upon any person or entity which is not a party or an assignee or a
party to this Agreement.
(i) Defined Terms. Except for provisions hereof that set forth the amended
provisions of the EMA and the OPEB Matters Agreement, capitalized terms used
herein and not otherwise defined shall have the meanings given to such terms in
the TDA.
14
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered as of the date first above written.
WYETH HOLDINGS CORPORATION
By: /s/ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
------------------
Name: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
Title: Vice President
MDP HOLDINGS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
CYTEC INDUSTRIES INC.
By: /s/ ▇▇▇ ▇▇▇▇▇
-------------
Name: ▇▇▇ ▇▇▇▇▇
Title: Vice President
15
Schedule A
----------
Wyeth Holdings Corporation
Wire Transfer Information
Bank Name: JPMorgan Chase Bank
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
ABA Number: ▇▇▇-▇▇▇-▇▇▇
(routing #)
SWIFT ID: ▇▇▇▇▇▇▇▇
CHIPS ABA: 0002
Account Name: Wyeth Holdings Corporation
Five Giralda Farms
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Account Number: ▇▇▇-▇▇▇-▇▇▇
16
Schedule B
MDP Holdings, Inc.
Wire Transfer Information
Bank Name: Wilmington Trust Company
▇▇▇▇▇▇ Square North
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ABA Number: ▇▇▇-▇▇▇-▇▇▇
(routing #)
Account Name: MDP Holdings, Inc.
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Account Number: 041154-000
17
SCHEDULE C
Open Bound Brook Claims
1. ▇▇▇▇▇▇, ▇▇▇▇▇▇ N400C1239271
2. ▇▇▇▇▇, ▇▇▇▇▇▇▇ C395C3963949
3. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ C395C4015649
4. ▇▇▇▇▇▇, ▇▇▇▇▇▇ C400C279850X
18
Schedule D
Lead Pigment Claims
Lead Claimant Status
CITY OF NEW YORK Closed
▇▇▇▇▇▇▇ R Open
GERMAN J Closed
▇▇▇▇▇, ▇▇▇▇ Closed
▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ Closed
▇▇▇▇▇, ▇▇▇▇▇▇ Closed
▇▇▇▇▇▇▇, ▇▇▇▇ Closed
WEST, MILES Closed
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ Open
▇▇▇▇▇, ▇▇▇▇▇▇▇ Open
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Closed
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Closed
▇▇▇▇▇, ▇▇▇▇▇▇ Closed
▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ Open
▇▇▇▇▇, GENESIS Open
DE LOS ▇▇▇▇▇▇, J. Open
▇▇▇▇▇▇, ▇▇▇▇▇▇ Closed
SPRING BRANCH Closed
▇▇▇▇▇▇▇, ▇▇▇▇ Open
CITY OF CHICAGO Open
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Open
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Open
19
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ Open
HAMILTON, BRANDO Open
HOUSTON INDEPENDENT SCHOOL Closed
▇▇▇▇▇▇, ▇▇▇▇▇ Closed
▇▇▇▇▇▇ COUNTY, TX Closed
▇▇▇▇▇, ▇▇▇▇ Open
▇▇▇▇▇▇▇, R Open
SABATOR, KAYLA Open
▇▇▇▇▇▇, ▇▇▇▇▇▇ Open
RHODE ISLAND, STATE OF Open
ST LOUIS, CITY OF Open
SANTA ▇▇▇▇▇ COUNTY Open
JEFFERSON SCHOOL DIST Open
QUITMAN SCHOOL Open
ESSEX COUNTY NJ, Open
CITY OF JERSEY, CITY Open
NEWARK, CITY OF Open
IRVINGTON TOWNSHIP Open
CUMBERLAND COUNTY Open
NORTH PLAINFIELD Open
CITY OF CAMDEN Open
PHILLIPSBURG, NJ Open
CITY OF GLOUCESTER Open
▇▇▇▇▇▇▇▇▇▇▇▇▇ Open
HIGHLAND PARK Open
20
CITY OF PLAINFIELD Open
ROSELLE Open
CITY OF PASSAIC Open
CITY OF UNION CITY Open
COUNTY OF UNION Open
CITY OF LINDEN Open
BAYONNE, CITY OF Open
EAST ORANGE Open
HILLSIDE TOWNSHIP Open
UNION TWP. NJ, Open
ROSELLE PARK Open
GLOUCESTER COUNTY Open
TOWN OF WEST NEW YORK Open
WEST ORANGE Open
21