(a) At the Effective Time, the certificate of incorporation of Quintiles (after giving effect to the Conversion) shall be the certificate of
incorporation of the Surviving Corporation (except that the name of the Surviving Corporation shall be Quintiles IMS Holdings, Inc.) (the
Surviving Corporation Charter
) until thereafter amended in accordance with its
terms and as provided by applicable Law.
(b) At the Effective Time, and without any further action on the part of IMS Health or Quintiles,
the bylaws of Quintiles (after giving effect to the Conversion) shall be the bylaws of the Surviving Corporation (the
Surviving Corporation Bylaws
) until thereafter amended in accordance with their terms, the certificate of
incorporation of the Surviving Corporation and as provided by applicable Law.
(a) Unless otherwise agreed by IMS Health and Quintiles prior to the Effective Time, IMS Health and Quintiles shall cause the Board of
Directors of the Surviving Corporation (the
Surviving Corporation Board
) to consist, at the Effective Time, of the persons set forth in
Exhibit B
hereto, including the Chairman and Vice Chairman as designated therein.
(b) In accordance with and subject to the Surviving Corporation Bylaws, at the Effective Time, the Surviving Corporation Board shall
constitute the following committees of the Surviving Corporation Board: (i) the Audit Committee, (ii) the Nominating and Governance Committee and (iii) the Leadership Development and Compensation Committee. As of the Effective Time,
the charters of the Audit Committee, Nominating and Governance Committee and Leadership Development and Compensation Committee shall each be in a form reasonably acceptable to the parties. Each such committee shall consist of two members of the
Surviving Corporation Board designated by IMS Health and two members of the Surviving Corporation Board designated by Quintiles. The Chairs of each such committee shall be as follows: (i) the Chair of the Nominating and Governance Committee
shall be designated by Quintiles; (ii) the Chair of the Leadership Development and Compensation Committee shall be designated by IMS Health; and (iii) the Chair of the Audit Committee shall be jointly designated by IMS Health and
Quintiles. The parties agree that, in addition to qualifying as independent directors under any applicable rules of the NYSE, each member of any of these committees shall meet any other applicable independence standards set forth in the
charter of such committee or contained in applicable rules under the Exchange Act or of the NYSE.
(c) In accordance with and subject to
the Surviving Corporation Bylaws, at the Effective Time, the officers of the Surviving Corporation shall consist of the Chief Executive Officer set forth in
Exhibit B
hereto, and the other officers designated in accordance with the procedures
set forth in
Section 1.6(c)
of the IMS Health Disclosure Letter, each until the earlier of his or her resignation or removal or until his or her successor is duly elected and qualified. The duties, powers and responsibilities of
such officers shall be as set forth in the Surviving Corporation Bylaws.
(a) Each share of common stock, par value
$0.01 per share, of Quintiles (
Quintiles Common Stock
) issued and outstanding immediately prior to the Effective Time shall remain outstanding (as of the Effective Time, the
Surviving Corporation Common Stock
).
(c) Each share of IMS Health Common Stock held in treasury or owned, directly or indirectly, by Quintiles, any of its Subsidiaries or any
Subsidiaries of IMS Health immediately prior to the Effective Time (collectively,
Excluded Shares
) shall automatically be cancelled and shall cease to exist, and no consideration shall be delivered in exchange therefor.
(d) The Exchange Ratio shall be adjusted to reflect fully the appropriate effect of any stock split, split-up, reverse stock split, stock
dividend or distribution of securities convertible into Quintiles Common Stock or IMS Health Common Stock, reorganization, recapitalization, reclassification or other like change with respect to Quintiles Common Stock or IMS Health Common Stock
having a record date occurring on or after the date of
(a) At the Effective Time, each IMS Health Option granted under any of the IMS Health Equity Plans, whether
vested or unvested, that is outstanding immediately prior to the Effective Time shall, at the Effective Time, cease to represent a right to acquire shares of IMS Health Common Stock and shall be automatically assumed by the Surviving Corporation and
converted under the applicable IMS Health Equity Plans into an option to acquire shares of Surviving Corporation Common Stock (a
Surviving Corporation Option
), on substantially the same terms and conditions (including any vesting
or forfeiture provisions or repurchase rights, but taking into account any acceleration thereof pursuant to the existing terms of the relevant IMS Health Equity Plans or applicable award agreement thereunder by reason of the transactions
contemplated hereby) as were applicable under such IMS Health Option as of immediately prior to the Effective Time, subject to adjustment as provided in this
Section 2.2(a)
;
provided
, that any IMS Health Options subject to
performance-based vesting criteria for which the performance period has not yet been completed as of the Effective Time, shall be converted into Surviving Corporation Options that vest based upon continued service only, in installments on each
anniversary of the date of grant of such award and in the same number of shares as were scheduled to vest on each such anniversary under such IMS Health Option. The number of shares of Surviving Corporation Common Stock subject to each such
Surviving Corporation Option shall be equal to (i) the number of shares of IMS Health Common Stock subject to each IMS Health Option immediately prior to the Effective Time multiplied by (ii) the Exchange Ratio, rounded down, if necessary,
to the nearest whole share of Surviving Corporation Common Stock, and such Surviving Corporation Option shall have an exercise price per share equal to (A) the exercise price per share of IMS Health Common Stock otherwise purchasable pursuant
to such IMS Health Option divided by (B) the Exchange Ratio, rounded up, if necessary, to the nearest whole cent;
provided
, that in the case of any IMS Health Option to which Section 421 of the Code applies as of the Effective Time
(taking into account the effect of any accelerated vesting thereof pursuant to the existing terms of the relevant IMS Health Equity Plans or applicable award agreement thereunder by reason of the transactions contemplated hereby, if applicable) by
reason of its qualification under Section 422 of the Code, the exercise price, the number of shares of Surviving Corporation Common Stock subject to such option and the terms and conditions of such option shall be determined in a manner
consistent with the requirements of Section 424(a) of the Code;
provided
,
further
, that the exercise price, the number of shares of Surviving Corporation Common Stock subject to, and the terms and conditions of each Surviving
Corporation Option shall also be determined in a manner consistent with the requirements of Section 409A of the Code.
(b) At the
Effective Time, each time-based or performance-based IMS Health RSU, whether vested or unvested, that is outstanding immediately prior to the Effective Time shall, at the Effective Time, be automatically assumed by the Surviving Corporation and
converted under the applicable IMS Health Equity Plans into a restricted stock unit denominated in shares of Surviving Corporation Common Stock (each, a
Surviving Corporation RSU
), on substantially the same terms and conditions
(including any vesting or forfeiture provisions or repurchase rights, but taking into account any acceleration or other deemed satisfaction thereof pursuant to the existing terms of the relevant IMS Health Equity Plans or applicable award agreement
thereunder by reason of the transactions contemplated hereby) as were applicable under such IMS Health RSU as of immediately prior to the Effective Time, subject to adjustment as provided in this
Section 2.2(b)
. The number of shares of
Surviving Corporation Common Stock subject to each such Surviving Corporation RSU shall be equal to (i) the number of shares of IMS Health Common Stock subject to each IMS Health RSU immediately prior to the Effective Time multiplied by
(ii) the Exchange Ratio, rounded down, if necessary, to the nearest whole share of Surviving Corporation Common Stock;
provided,
that any outstanding IMS Health RSUs subject to performance-based vesting criteria for a performance period
that ended prior to or coincident with the Effective Time shall vest based on the actual performance achieved for the applicable performance period and any outstanding IMS Health RSUs subject to performance-based vesting criteria for which the
performance period has not yet been completed as of the Effective
Time, shall be converted into Surviving Corporation RSUs that vest based upon continued service only at the same times as the expiration of the applicable performance periods under such IMS
Health RSU awards, with respect to a number of shares of Surviving Corporation Common Stock, rounded down, if necessary, to the nearest whole share of Surviving Corporation Common Stock, determined based on the higher of (x) the actual
performance achieved for the applicable performance period as of the Effective Time or (y) the target performance level for the applicable performance period, in each case, multiplied by the Exchange Ratio.
(c) At the Effective Time, each award of IMS Health Common Stock subject to time-based vesting restrictions (each a
IMS Health
Restricted Stock
), that is outstanding immediately prior to the Effective Time shall, at the Effective Time, be automatically assumed by the Surviving Corporation and converted under the applicable IMS Health Equity Plans into a restricted
stock award denominated in shares of Surviving Corporation Common Stock (each a
Surviving Corporation Restricted Stock
), on substantially the same terms and conditions (including any vesting or forfeiture provisions or repurchase
rights, but taking into account any acceleration or other deemed satisfaction thereof pursuant to the existing terms of the relevant IMS Health Equity Plans or applicable award agreement thereunder by reason of the transactions contemplated hereby)
as were applicable under such IMS Health Restricted Stock as of immediately prior to the Effective Time, subject to adjustment as provided in this
Section 2.2(c)
. The number of shares of Surviving Corporation Common Stock subject to each
such Surviving Corporation Restricted Stock shall be equal to (i) the number of shares of IMS Health Common Stock subject to each IMS Health Restricted Stock immediately prior to the Effective Time multiplied by (ii) the Exchange Ratio,
rounded down, if necessary, to the nearest whole share of Surviving Corporation Common Stock.
(d) At the Effective Time, each IMS Health
SAR, whether vested or unvested, that is outstanding immediately prior to the Effective Time shall, at the Effective Time, be automatically assumed by the Surviving Corporation and converted under the applicable IMS Health Equity Plans into a stock
appreciation right corresponding to shares of Surviving Corporation Common Stock (each, a
Surviving Corporation SAR
), on substantially the same terms and conditions (including any vesting or forfeiture provisions or repurchase
rights, but taking into account any acceleration or other deemed satisfaction thereof pursuant to the existing terms of the relevant IMS Health Equity Plans or applicable award agreement thereunder by reason of the transactions contemplated hereby)
as were applicable under such IMS Health SAR as of immediately prior to the Effective Time, subject to adjustment as provided in this
Section 2.2(d)
. The number of shares of Surviving Corporation Common Stock corresponding to each such
Surviving Corporation SAR shall be equal to (i) the number of shares of IMS Health Common Stock corresponding to each IMS Health SAR immediately prior to the Effective Time multiplied by (ii) the Exchange Ratio, rounded down, if necessary,
to the nearest whole share of Surviving Corporation Common Stock, and the per share exercise price for each share of Surviving Corporation Common Stock covered by the Surviving Corporation SAR shall be equal to (A) the exercise price per share
of IMS Health Common Stock immediately before the Effective Time divided by (B) the Exchange Ratio, rounded up, if necessary, to the nearest whole cent;
provided
however
, that the exercise price, the number of shares of Surviving
Corporation Common Stock covered by the Surviving Corporation SAR and the terms and conditions of each Surviving Corporation SAR shall be determined in a manner consistent with the requirements of Section 409A of the Code.
(e) Prior to the Effective Time, IMS Health shall provide such notice, if any, to the extent required under the terms of the applicable IMS
Health Equity Plans, obtain any necessary consents, waivers or releases, adopt applicable resolutions, amend the terms of the IMS Health Equity Plans or any outstanding awards, obtain required shareholder approval with respect to any such amendment,
and take all other appropriate actions to effectuate the provisions of this
Section 2.2
. At the Effective Time, the Surviving Corporation shall assume the IMS Health Equity Plans,
provided
, that all references to
Company in the applicable IMS Health Equity Plan and the documents governing the assumed and converted Surviving Corporation Options, Surviving Corporation RSUs and Surviving Corporation SARs after the Effective Time shall be deemed
references to Surviving Corporation and the number of shares of Surviving Corporation Common Stock available for awards under the IMS Health Equity Plans shall be determined by adjusting the number of shares of IMS Health Common Stock available for
awards under the IMS Health Equity Plans immediately before the Effective Time in accordance with the Exchange Ratio and the provisions of this
Section 2.2
.
(f) The Surviving Corporation shall reserve for issuance a number of shares of Surviving
Corporation Common Stock at least equal to the number of shares of Surviving Corporation Common Stock that will be subject to Surviving Corporation Options, Surviving Corporation RSUs and Surviving Corporation SARs as a result of the actions
contemplated by this
Section 2.2
. As soon as practicable following the Effective Time, the Surviving Corporation shall file a registration statement on Form S-8 (or any successor form, or if Form S-8 is not available, other appropriate
forms, including Form S-3) with respect to the shares of Surviving Corporation Common Stock subject to such Surviving Corporation Options, Surviving Corporation RSUs and Surviving Corporation SARs and shall use its commercially reasonable efforts to
maintain the effectiveness of such registration statement or registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as such Surviving Corporation Options, Surviving Corporation RSUs
and Surviving Corporation SARs remain outstanding and are required to be registered.
(a) Prior to the Closing, Quintiles shall appoint a U.S.-based nationally recognized bank or trust company, which shall be reasonably
acceptable to IMS Health, to act as exchange agent (the
Exchange Agent
) for the issuance and payment of the Merger Consideration to the holders of shares of IMS Health Common Stock as provided in
Section 2.1
, including
any dividends or other distributions payable pursuant to
Section 2.3(d)
and any cash in lieu of fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
. Quintiles will enter into an exchange
agent agreement with the Exchange Agent (the
Exchange Agent Agreement
) on terms reasonably acceptable to IMS Health and Quintiles prior to the Closing. Prior to or at the Closing, the Surviving Corporation shall deposit (or cause
to be deposited) with the Exchange Agent, in trust for the benefit of holders of shares of IMS Health Common Stock immediately prior to the Effective Time (other than holders to the extent they hold Excluded Shares), book-entry shares (or
certificates if requested) representing the shares of Surviving Corporation Common Stock issuable pursuant to
Section 2.1(b)
and cash sufficient to make payments in lieu of fractional shares of Surviving Corporation Common Stock payable
pursuant to
Section 2.3(f)
. In addition, the Surviving Corporation shall make available by depositing with the Exchange Agent, as necessary from time to time after the Effective Time, any dividends or distributions payable pursuant to
Section 2.3(d)
. All certificates representing shares of Surviving Corporation Common Stock, dividends, distributions and cash deposited with the Exchange Agent are hereinafter referred to as the
Exchange Fund
. The
Exchange Agent shall make payments of the Merger Consideration out of the Exchange Fund in accordance with this Agreement and the Exchange Agent Agreement. The Exchange Fund shall not be used for any other purpose.
(b) As soon as reasonably practicable after the Effective Time and in any event not later than the third Business Day thereafter, the
Surviving Corporation shall cause the Exchange Agent to mail to each holder of record of a certificate (
Certificates
) that immediately prior to the Effective Time represented outstanding shares of IMS Health Common Stock that were
converted into the right to receive the Merger Consideration, any dividends or distributions payable pursuant to
Section 2.3(d)
and any cash in lieu of fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
, (i) a form of letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates held by such holder shall pass, only upon proper delivery of the Certificates
to the Exchange Agent, and which letter shall be in customary form and contain such other provisions as IMS Health and Quintiles may reasonably agree or the Exchange Agent may reasonably specify) and (ii) instructions for use in effecting the
surrender of such Certificates (or affidavits of loss in lieu thereof) to the Exchange Agent in exchange for the Merger Consideration, any dividends or other distributions payable pursuant to
Section 2.3(d)
and any cash in lieu of
fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
. Upon surrender of a Certificate (or affidavit of loss in lieu thereof) to the Exchange Agent, together with such letter of transmittal, duly
completed and validly executed in accordance with the instructions thereto, and such other documents as the Exchange Agent may reasonably require, the holder of such Certificate shall be entitled to receive in exchange for the shares of IMS Health
Common Stock formerly represented by such Certificate (other than Excluded Shares) (A) that number of whole shares of Surviving Corporation Common Stock (after taking into account all
shares of IMS Health Common Stock then held by such holder under all Certificates so surrendered (or affidavits of loss in lieu thereof so delivered)) to which such holder of IMS Health Common
Stock shall have become entitled pursuant to
Section 2.1(b)
(which shall be in uncertificated book-entry form unless a physical certificate is requested), (B) any dividends or other distributions payable pursuant to
Section 2.3(d)
and (C) any cash in lieu of fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
, and the Certificate so surrendered shall forthwith be cancelled. Promptly after the
Effective Time and in any event not later than the third Business Day thereafter, the Surviving Corporation shall cause the Exchange Agent to issue and send to each holder of uncertificated shares of IMS Health Common Stock represented by book entry
(
Book-Entry Shares
), other than with respect to Excluded Shares, (1) that number of whole shares of Surviving Corporation Common Stock to which such holder of Book-Entry Shares shall have become entitled pursuant to the
provisions of
Section 2.1(b)
(which shall be in book-entry form unless a physical certificate is requested), (2) any dividends or other distributions payable pursuant to
Section 2.3(d)
and (3) any cash in lieu of
fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
, without such holder being required to deliver a Certificate or an executed letter of transmittal to the Exchange Agent, and such Book-Entry
Shares shall then be cancelled. No interest will be paid or accrued on any unpaid dividends and distributions or cash in lieu of fractional shares, if any, payable to holders of Certificates or Book-Entry Shares. Until surrendered as contemplated by
this
Section 2.3
, each Certificate or Book-Entry Share shall be deemed after the Effective Time to represent only the right to receive the Merger Consideration payable in respect thereof, any dividends or other distributions payable
pursuant to
Section 2.3(d)
and any cash in lieu of fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
.
(c) If payment of the Merger Consideration is to be made to a Person other than the Person in whose name the surrendered Certificate or
Book-Entry Share is registered, it shall be a condition of payment that such Certificate so surrendered shall be properly endorsed or shall be otherwise in proper form for transfer or such Book-Entry Share shall be properly transferred and that the
Person requesting such payment shall have paid any transfer and other Taxes required by reason of the payment of the Merger Consideration to a Person other than the registered holder of such Certificate or Book-Entry Share or shall have established
to the satisfaction of the Surviving Corporation that such Tax is not applicable.
(d) (i) No dividends or other distributions with
respect to Surviving Corporation Common Stock with a record date after the Effective Time shall be paid to the holder of any unsurrendered Certificate with respect to the shares of Surviving Corporation Common Stock that the holder thereof has the
right to receive upon the surrender thereof, and no cash payment in lieu of fractional shares of Surviving Corporation Common Stock shall be paid to any such holder pursuant to
Section 2.3(f)
, in each case until the holder thereof shall
surrender such Certificate (or deliver an affidavit of loss in lieu thereof) in accordance with this Article II. Following the surrender of a Certificate (or delivery of an affidavit of loss in lieu thereof) in accordance with this Article II, there
shall be paid to the record holder thereof, without interest, (A) promptly after such surrender (or delivery), the amount of any dividends or other distributions with a record date after the Effective Time theretofore paid with respect to such
whole shares of Surviving Corporation Common Stock and the amount of any cash payable in lieu of a fractional share of Surviving Corporation Common Stock to which such holder is entitled pursuant to
Section 2.3(f)
and (B) at the
appropriate payment date, the amount of dividends or other distributions with a record date after the Effective Time but prior to such surrender (or delivery) and a payment date subsequent to such surrender (or delivery) payable with respect to such
whole shares of Surviving Corporation Common Stock.
(ii) Notwithstanding anything in the foregoing to the contrary,
holders of Book-Entry Shares who are entitled to receive shares of Surviving Corporation Common Stock under this Article II shall be paid (A) at the time of payment of such Surviving Corporation Common Stock by the Exchange Agent under
Section 2.3(b)
, the amount of dividends or other distributions with a record date after the Effective Time theretofore paid with respect to such whole shares of Surviving Corporation Common Stock, and the amount of any cash payable in
lieu of a fractional share of Surviving Corporation Common Stock to which such holder is entitled pursuant to
Section 2.3(f)
and (B) at the appropriate payment date, the amount of dividends or other distributions with a record date
after the Effective Time
(e) The Merger Consideration,
any dividends or other distributions payable pursuant to
Section 2.3(d)
and any cash in lieu of fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
issued and paid upon the surrender for
exchange of Certificates (or affidavits of loss in lieu thereof) or Book-Entry Shares in accordance with the terms of this Article II shall be deemed to have been issued and paid in full satisfaction of all rights pertaining to the shares of IMS
Health Common Stock formerly represented by such Certificates or Book-Entry Shares. At the Effective Time, the stock transfer books of IMS Health shall be closed and there shall be no further registration of transfers of the shares of IMS Health
Common Stock that were outstanding immediately prior to the Effective Time. If, after the Effective Time, Certificates (or affidavits of loss in lieu thereof) are presented to the Surviving Corporation or the Exchange Agent for transfer or transfer
is sought for Book-Entry Shares, such Certificates or Book-Entry Shares shall be cancelled and exchanged as provided in this Article II.
(f) Notwithstanding anything to the contrary contained herein, no certificates representing fractional shares of Surviving Corporation Common
Stock shall be issued upon the surrender for exchange of Certificates or Book-Entry Shares, no dividends or other distributions with respect to the Surviving Corporation Common Stock shall be payable on or with respect to any fractional share, and
such fractional share interests shall not entitle the owner thereof to vote or to any other rights of a stockholder of the Surviving Corporation. In lieu of the issuance of any such fractional share, the Surviving Corporation shall pay to each
former stockholder of IMS Health who otherwise would be entitled to receive a fractional share of Surviving Corporation Common Stock an amount in cash (without interest) determined by multiplying (i) the fraction of a share of Surviving
Corporation Common Stock which such holder would otherwise be entitled to receive (taking into account all shares of IMS Health Common Stock held at the Effective Time by such holder and rounded to the nearest thousandth when expressed in decimal
form) pursuant to
Section 2.1(b)
by (ii) the volume weighted average closing price of one share of Quintiles Common Stock on the NYSE for the five trading days ending on the last trading day immediately prior to the date on which
the Effective Time shall occur, as such price is reported on the NYSE Composite Transactions Tape (as reported by Bloomberg Financial Markets or such other source as the parties shall agree in writing).
(g) Any portion of the Exchange Fund that remains undistributed to the holders of Certificates or Book-Entry Shares twelve (12) months
after the Effective Time shall be delivered to the Surviving Corporation, upon demand, and any remaining holders of Certificates or Book-Entry Shares (except to the extent representing Excluded Shares) shall thereafter look only to the Surviving
Corporation for payment of the Merger Consideration, any unpaid dividends or other distributions payable pursuant to
Section 2.3(d)
and any cash in lieu of fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
(subject to abandoned property, escheat or other similar laws), without interest.
(h) None of the Surviving
Corporation, the Exchange Agent or any other Person shall be liable to any Person in respect of shares of Surviving Corporation Common Stock, dividends or other distributions with respect thereto or cash in lieu of fractional shares of Surviving
Corporation Common Stock properly delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law. If any Certificates or Book-Entry Shares shall not have been exchanged prior to such date on which the related
Merger Consideration (and all dividends or other distributions with respect to shares of Surviving Corporation Common Stock and any cash in lieu of fractional shares of Surviving Corporation Common Stock pursuant to this Article II) would otherwise
escheat to or become the property of any Governmental Entity, any such Merger Consideration (and such dividends, distributions and cash) in respect thereof shall, to the extent permitted by applicable Law, become the property of the Surviving
Corporation, free and clear of all claims or interest of any Person previously entitled thereto.
(i) The Exchange Agent shall invest any cash included in the Exchange Fund as directed by the
Surviving Corporation. Any interest and other income resulting from such investments shall be paid to the Surviving Corporation.
(j) If
any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit, in form and substance reasonably acceptable to the Surviving Corporation, of that fact by the Person claiming such Certificate to be lost, stolen or
destroyed and, if required by the Surviving Corporation or the Exchange Agent, the posting by such Person of a bond in such reasonable and customary amount as the Surviving Corporation or the Exchange Agent may determine is reasonably necessary as
indemnity against any claim that may be made against it or the Surviving Corporation with respect to such Certificate, the Exchange Agent will deliver in exchange for such lost, stolen or destroyed Certificate the Merger Consideration payable in
respect thereof, any dividends or other distributions payable pursuant to
Section 2.3(d)
and any cash in lieu of fractional shares of Surviving Corporation Common Stock payable pursuant to
Section 2.3(f)
.
Section 2.4
Withholding Rights
. The Surviving Corporation and the Exchange Agent shall each be entitled to deduct and withhold, or
cause to be deducted and withheld, from the consideration otherwise payable to any holder of shares of IMS Health Common Stock or otherwise pursuant to this Agreement such amounts as the Surviving Corporation or the Exchange Agent is required to
deduct and withhold under the Code, or any provision of state, local or foreign tax Law, and shall pay over, or cause to be paid over, such deducted and withheld amounts to the appropriate Governmental Entity. To the extent that amounts are so
deducted and remitted to the appropriate Governmental Entity, such amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of whom such deduction and withholding was made.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF IMS HEALTH
Except (a) as disclosed or reflected in the IMS Health SEC Documents filed prior to the date of this Agreement (but excluding any risk
factor disclosures contained under the heading Risk Factors, any disclosure of risks included in any forward-looking statements disclaimer or any other statements that are similarly predictive or forward-looking in nature, in
each case, other than any specific factual information contained therein), or (b) as set forth in the disclosure letter delivered by IMS Health to Quintiles prior to the execution of this Agreement (the
IMS Health Disclosure
Letter
) (it being agreed that the disclosure of any information in a particular section or subsection of the IMS Health Disclosure Letter shall be deemed disclosure with respect to any other section or subsection of this Agreement to which
the relevance of such information is reasonably apparent), IMS Health represents and warrants to Quintiles as follows:
Section 3.1
Organization, Standing and Power
.
(a) Each of IMS Health and its Subsidiaries (i) is an entity duly organized, validly
existing and in good standing (with respect to jurisdictions that recognize such concept or equivalent) under the Laws of the jurisdiction of its organization, (ii) has all requisite corporate or similar power and authority to own, lease and
operate its properties and to carry on its business as now being conducted and (iii) is duly qualified or licensed to do business and is in good standing (with respect to jurisdictions that recognize such concept or equivalent) in each
jurisdiction in which the nature of its business or the ownership, leasing or operation of its properties makes such qualification or licensing necessary, except, with respect to clause (i) only as it relates to Subsidiaries and clauses
(ii) and (iii), for any such failures to have such power or authority or to be so qualified or licensed or in good standing, individually or in the aggregate, as have not had and would not reasonably be expected to have an IMS Health Material
Adverse Effect.
(b) IMS Health has previously furnished or otherwise made available to Quintiles true and complete copies of IMS
Healths certificate of incorporation (the
IMS Health Charter
) and bylaws (the
IMS Health
Bylaws
), in each case as amended to the date of this Agreement, and each as so delivered is in full force and
effect.
A-10
Section 3.2
Capital Stock
.
(a) The authorized capital stock of IMS Health consists of 700,000,000 shares of IMS Health Common Stock and 50,000,000 shares of preferred
stock, par value $0.01 per share (the
IMS Health Preferred Stock
). As of the close of business on April 27, 2016 (the
Measurement Date
), (i) 329,877,234 shares of IMS Health Common Stock were issued
and outstanding (excluding treasury shares), (ii) 12,599,771 shares of IMS Health Common Stock were held by IMS Health in its treasury, (iii) no shares of IMS Health Preferred Stock were issued and outstanding, (iv) 39,518,678 shares
of IMS Health Common Stock were reserved and available for issuance pursuant to IMS Health Equity Plans; of which 15,814,212 shares of IMS Health Common Stock were subject to issuance pursuant to outstanding equity awards of IMS Health granted
pursuant to IMS Health Equity Plans, comprised of (A) 10,243,600 IMS Health Common Stock were subject to issuance pursuant to the exercise of outstanding options (each, an
IMS Health Option
) to purchase shares of IMS Health
Common Stock granted under the IMS Health Equity Plans, (B) restricted stock unit awards (
IMS Health RSUs
) representing the right to receive up to 1,904,270 shares of IMS Health Common Stock were outstanding and
(C) 3,596,740 shares of IMS Health Common Stock were underlying outstanding IMS Health stock appreciation rights (
IMS Health SARs
) and (v) 69,602 shares of IMS Health Common Stock reserved for issuance under the IMS
Health Defined Contribution Executive Retirement Plan. All outstanding shares of capital stock of IMS Health are, and all shares reserved for issuance will be, when issued, duly authorized, validly issued, fully paid and nonassessable and not
subject to or issued in violation of any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the DGCL, the IMS Health Charter, the IMS Health Bylaws or any Contract
to which IMS Health is a party or is otherwise bound. No shares of capital stock of IMS Health are owned by any Subsidiary of IMS Health. All outstanding shares of capital stock and other voting securities or equity interests of each Subsidiary of
IMS Health have been duly authorized and validly issued, are fully paid, nonassessable and not subject to any preemptive rights. All outstanding shares of capital stock and other voting securities or equity interests of each such Subsidiary are
owned, directly or indirectly, by IMS Health, free and clear of all pledges, claims, liens, charges, options, rights of first refusal, encumbrances and security interests of any kind or nature whatsoever (including any limitation on voting, sale,
transfer or other disposition or exercise of any other attribute of ownership) (collectively,
Liens
).
(b) Except as
set forth above and except for changes since the Measurement Date resulting from the exercise or vesting of awards made under the IMS Health Equity Plans outstanding on such date, as of the date of this Agreement, (i) there are not outstanding
or authorized any (A) shares of capital stock or other voting securities of IMS Health, (B) securities of IMS Health convertible into or exchangeable for shares of capital stock or voting securities of IMS Health or (C) options or
other rights to acquire from IMS Health, and no obligation of IMS Health to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of IMS Health, (ii) there are no
outstanding obligations of IMS Health to repurchase, redeem or otherwise acquire any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of IMS Health and (iii) there are no
other options, calls, warrants or other rights, agreements, arrangements or commitments of any character relating to the issued or unissued capital stock of IMS Health or any of its Subsidiaries to which IMS Health or any of its Subsidiaries is a
party.
Section 3.3
Subsidiaries
. Exhibit 21 to the Annual Report on Form 10-K filed by IMS Health with the SEC on
February 19, 2016 (without giving effect to any amendment filed on or after the date hereof) sets forth a true and complete list of each material Subsidiary of IMS Health. All outstanding shares of capital stock, or other equity or voting
interests in, each Subsidiary of IMS Health are, and all shares reserved for issuance will be, when issued, duly authorized, validly issued, fully paid and nonassessable and not subject to or issued in violation of any purchase option, call option,
right of first refusal, preemptive right, subscription right or any similar right under any provision of the DGCL, its certificate of incorporation or bylaws or comparable organizational documents, or any Contract to which IMS Health is a party or
is otherwise bound. Except for the capital stock of, or other equity or voting interests in, its Subsidiaries, IMS Health does not own, directly or indirectly, any equity, membership interest, partnership interest, joint venture interest, or other
equity or voting
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interest in, or any interest convertible into, exercisable or exchangeable for any of the foregoing, nor is it under any current or prospective obligation to form or participate in, provide funds
to, make any loan, capital contribution, guarantee, credit enhancement or other investment in, any Person.
Section 3.4
Authority
.
(a) IMS Health has all necessary corporate power and authority to execute, deliver and perform its obligations under
this Agreement and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement by IMS Health and the consummation by IMS Health of the transactions contemplated hereby have been duly authorized by
all necessary corporate action on the part of IMS Health and no other corporate proceedings on the part of IMS Health are necessary to approve this Agreement or to consummate the Merger and the other transactions contemplated hereby, subject, in the
case of the consummation of the Merger and the other transactions contemplated hereby, to (i) the adoption of this Agreement by the affirmative vote of the holders of a majority of the outstanding IMS Health Common Stock entitled to vote upon
the adoption of this Agreement and (ii) to the extent required by applicable Law, the approval of the certificate of incorporation of the Converted Entity (the
Converted Entity Charter
), in connection with the Conversion, or
one or more of the provisions thereof, by the affirmative vote of the holders of outstanding IMS Health Common Stock representing a majority of the votes cast with respect to such approval;
provided
,
however
, that any such approvals
referred to in the foregoing clauses (i) and (ii) shall be unbundled into separate proposals to the extent required by applicable Law (the
IMS Health Stockholder Approval
). This Agreement has been duly executed and
delivered by IMS Health and, assuming the due authorization, execution and delivery by Quintiles, constitutes a valid and binding obligation of IMS Health, enforceable against IMS Health in accordance with its terms (except to the extent that
enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization or similar Laws affecting the enforcement of creditors rights generally or by general principles of equity).
(b) The Board of Directors of IMS Health (the
IMS Health Board
), at a meeting duly called and held at which all directors
of IMS Health were present, duly and unanimously adopted resolutions (i) determining that the terms of this Agreement, the Merger and the other transactions contemplated hereby are fair to and in the best interests of IMS Healths
stockholders, (ii) approving and declaring advisable this Agreement and the transactions contemplated hereby, including the Merger, (iii) directing that this Agreement be submitted to the stockholders of IMS Health for adoption and
(iv) resolving to recommend that IMS Healths stockholders vote in favor of the adoption of this Agreement and the transactions contemplated hereby, including the Merger, which resolutions have not been subsequently rescinded, modified or
withdrawn in any way, except as may be permitted by
Section 5.3
.
(c) The votes comprising the IMS Health Stockholder Approval
are the only votes of the holders of any class or series of IMS Healths capital stock or other securities required in connection with the consummation of the Merger. No vote of the holders of any class or series of IMS Healths capital
stock or other securities is required in connection with the consummation of any of the transactions contemplated hereby to be consummated by IMS Health other than the Merger.
Section 3.5
No Conflict; Consents and Approvals
.
(a) The execution, delivery and performance of this Agreement by IMS Health does not, and the consummation of the Merger and the other
transactions contemplated hereby and compliance by IMS Health with the provisions hereof will not, conflict with, or result in any violation or breach of, or default (with or without notice or lapse of time, or both) under, or give rise to a right
of, or result in, termination, cancellation, modification or acceleration of any obligation or to the loss of a material benefit under, or result in the creation of any Lien in or upon any of the properties, assets or rights of IMS Health or any of
its Subsidiaries under, or give rise to any increased, additional, accelerated or guaranteed rights or entitlements under, or require any consent, waiver or approval of any Person pursuant to, any provision of (i) the IMS Health Charter or IMS
Health Bylaws,
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or the certificate of incorporation or bylaws (or similar organizational documents) of any Subsidiary of IMS Health, (ii) any Contract to which IMS Health or any of its Subsidiaries is a
party or by which IMS Health or any of its Subsidiaries or any of their respective properties or assets may be bound or (iii) subject to receipt of the IMS Health Stockholder Approval and the governmental filings and other matters referred to
in
Section 3.5(b)
, any Law or any rule or regulation of the NYSE applicable to IMS Health or any of its Subsidiaries or by which IMS Health or any of its Subsidiaries or any of their respective properties or assets may be bound, except,
in the case of clauses (ii) and (iii), as, individually or in the aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect.
(b) No consent, approval, order or authorization of, or registration, declaration, filing with or notice to, any Governmental Entity is
required by or with respect to IMS Health or any of its Subsidiaries in connection with the execution, delivery and performance of this Agreement by IMS Health or the consummation by IMS Health of the Merger and the other transactions contemplated
hereby or compliance with the provisions hereof, except for (i) as required under the HSR Act or under any other applicable Antitrust Law, (ii) such filings and reports as may be required pursuant to the applicable requirements of the
Securities Act, the Exchange Act and any other applicable state or federal securities, takeover and blue sky laws, (iii) the filing of the Certificate of Merger with the Delaware Secretary of State, as required by the DGCL, (iv) any
filings and approvals required under the rules and regulations of NYSE and (v) such other consents, approvals, orders, authorizations, registrations, declarations, filings or notices the failure of which to be obtained or made, individually or
in the aggregate, have not had or would not reasonably be expected to have an IMS Health Material Adverse Effect.
Section 3.6
SEC
Reports; Financial Statements; Internal Controls
.
(a) IMS Health has filed with or furnished to the SEC on a timely basis true and
complete copies of all forms, reports, schedules, statements and other documents required to be filed with or furnished to the SEC by IMS Health since January 1, 2014 (all such documents, together with all exhibits and schedules to the
foregoing materials and all information incorporated therein by reference, the
IMS Health SEC Documents
). As of their respective filing dates (or, if amended or superseded by a filing prior to the date of this Agreement, then on
the date of such filing), the IMS Health SEC Documents complied in all material respects with the applicable requirements of the Securities Act, the Exchange Act and the Sarbanes-Oxley Act, as the case may be, including, in each case, the rules and
regulations promulgated thereunder, and none of the IMS Health SEC Documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(b) The financial statements (including the related notes and
schedules thereto) included (or incorporated by reference) in the IMS Health SEC Documents (i) have been prepared in a manner consistent with the books and records of IMS Health and its Subsidiaries, (ii) have been prepared in accordance
with GAAP (except, in the case of unaudited statements, as permitted by Form 10-Q of the SEC) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto), (iii) comply as to form in all material
respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto and (iv) fairly present in all material respects the consolidated financial position of IMS Health and its Subsidiaries as
of the dates thereof and their respective consolidated results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal and recurring year-end audit adjustments that were not, or are not
expected to be, material in amount), all in accordance with GAAP and the applicable rules and regulations promulgated by the SEC. Since December 31, 2015, IMS Health has not made any change in the accounting practices or policies applied in the
preparation of its financial statements, except as required by GAAP, SEC rule or policy or applicable Law. The books and records of IMS Health and its Subsidiaries have been, and are being, maintained in all material respects in accordance with GAAP
(to the extent applicable) and any other applicable legal and accounting requirements and reflect only actual transactions.
(c) IMS
Health has established and maintains disclosure controls and procedures and internal control over financial reporting (as such terms are defined in paragraphs (e) and (f), respectively, of Rule 13a-15 under
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the Exchange Act) as required by Rule 13a-15 under the Exchange Act. IMS Healths disclosure controls and procedures are designed to provide reasonable assurance that all material
information required to be disclosed by IMS Health in the reports that it files or furnishes under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that all
such material information is accumulated and communicated to IMS Healths management as appropriate to allow timely decisions regarding required disclosure and to make the certifications required pursuant to Sections 302 and 906 of the
Sarbanes-Oxley Act. IMS Healths management has completed an assessment of the effectiveness of IMS Healths disclosure controls and procedures in accordance with Rule 13a-15 and, to the extent required by applicable Law, presented in any
applicable IMS Health SEC Document that is a report on Form 10-K or Form 10-Q its conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by such report based on such evaluation. Based on IMS
Healths managements most recently completed evaluation of the IMS Healths internal control over financial reporting prior to the date of this Agreement, (i) to the knowledge of IMS Health, IMS Health had no significant
deficiencies or material weaknesses in the design or operation of its internal control over financial reporting that would reasonably be expected to adversely affect IMS Healths ability to record, process, summarize and report financial
information and (ii) IMS Health does not have knowledge of any fraud, whether or not material, that involves management or other employees who have a significant role in IMS Healths internal control over financial reporting.
(d) To the knowledge of IMS Health, as of the date of this Agreement, there are no SEC inquiries or investigations, other governmental
inquiries or investigations or internal investigations pending or threatened, in each case regarding any accounting practices of IMS Health.
Section 3.7
No Undisclosed Liabilities
. Neither IMS Health nor any of its Subsidiaries has any liabilities or obligations of any
nature, whether accrued, absolute, contingent or otherwise, and whether or not required to be recorded or reflected on a balance sheet under GAAP, except (a) to the extent disclosed, reflected, accrued or reserved against in the audited
consolidated balance sheet of IMS Health and its Subsidiaries as at December 31, 2015 included in the Annual Report on Form 10-K filed by IMS Health with the SEC on February 19, 2016 (without giving effect to any amendment thereto filed on
or after the date hereof) and (b) for liabilities and obligations incurred in the ordinary course of business consistent with past practice since December 31, 2015 that would not, individually or in the aggregate, reasonably be expected to
have an IMS Health Material Adverse Effect.
Section 3.8
Certain Information
. None of the information supplied or to be
supplied by or on behalf of IMS Health specifically for inclusion or incorporation by reference in the Form S-4 will, at the time the Form S-4 is filed with the SEC, at the time of any amendment or supplement thereto and at the time it (or any
post-effective amendment or supplement) becomes effective under the Securities Act, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not
misleading. The Joint Proxy Statement/Prospectus will not, at the time it is first mailed to IMS Healths stockholders, at the time of any amendments or supplements thereto and at the time of the IMS Health Stockholders Meeting, contain any
untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they are made, not misleading. The Joint Proxy
Statement/Prospectus will comply as to form in all material respects with the provisions of the Exchange Act. Notwithstanding the foregoing, IMS Health makes no representation or warranty with respect to statements included or incorporated by
reference in the Form S-4 or the Joint Proxy Statement/Prospectus based on information supplied in writing by or on behalf of Quintiles specifically for inclusion or incorporation by reference therein.
Section 3.9
Absence of Certain Changes or Events
. Since December 31, 2015 through the date of the Agreement: (a) there
has not been any change, occurrence, state of fact, event or development or prospective change, event or development that, individually or in the aggregate, has had or would reasonably be expected to have an IMS Health Material Adverse Effect, and
(b) except as otherwise contemplated or permitted by this Agreement, (i) IMS Health and its Subsidiaries have conducted their businesses in all material respects only in
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the ordinary course consistent with past practice; and (ii) neither IMS Health nor any of its Subsidiaries has suffered any loss, damage, destruction or other casualty affecting any of its
material properties or assets, whether or not covered by insurance.
Section 3.10
Litigation
. As of the date hereof, there is
no Action (or basis therefor) pending or, to the knowledge of IMS Health, threatened against or affecting IMS Health or any of its Subsidiaries or any of their respective properties or assets, other than any Action that, individually or in the
aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect. As of the date hereof, neither IMS Health nor any of its Subsidiaries nor any of their respective properties or assets is subject to any
outstanding judgment, order, injunction, rule or decree of any Governmental Entity that, individually or in the aggregate, has had or would reasonably be expected to have an IMS Health Material Adverse Effect. As of the date hereof, there is no
Action pending or, to the knowledge of IMS Health, threatened seeking to prevent, hinder, modify, delay or challenge the Merger or any of the other transactions contemplated by this Agreement.
Section 3.11
Compliance with Laws; Permits
.
(a) IMS Health and each of its Subsidiaries are and, at all times since January 1, 2013 have been, in compliance with all Laws applicable
to their businesses, operations, properties or assets, including all healthcare Laws, except where any non-compliance, individually or the aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect.
None of IMS Health or any of its Subsidiaries has received, since January 1, 2013, a notice or other written communication alleging or relating to a possible material violation of any Law, including any healthcare Law, applicable to their
businesses, operations, properties or assets, which alleged violation has not been materially resolved and which, individually or in the aggregate has had or would reasonably be expected to have an IMS Health Material Adverse Effect. IMS Health and
each of its Subsidiaries have in effect all Permits of all Governmental Entities necessary or advisable for them to own, lease or operate their properties and assets and to carry on their businesses as now conducted, except for any Permits the
absence of which would not, individually or in the aggregate, reasonably be expected to have an IMS Health Material Adverse Effect. All such Permits are in full force and effect, except where the failure to be in full force and effect would not,
individually or in the aggregate, reasonably be expected to have an IMS Health Material Adverse Effect.
(b) Without limiting the
generality of the foregoing, except as, individually or the aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect, IMS Health (i) does not itself and does not permit or assist any third party
to violate the rights of any Person, or the contractual obligations of IMS Health or any of its Subsidiaries, with respect to confidential, personally identifiable or personal health information, including all Privacy Rights, (ii) has
implemented reasonable technical, physical, and administrative safeguards necessary to protect the privacy, confidentiality, integrity and security of its software, databases, systems, networks and internet sites and all information stored or
contained therein or transmitted thereby from unauthorized or improper use, access or disclosure and (iii) maintains policies and procedures regarding data security and privacy that are commercially reasonable and, in any event, in compliance
with all of its obligations under applicable Law. There have been no breaches of either the data privacy policies or the system and data security policies of IMS Health or any of its Subsidiaries and neither IMS Health nor any of its Subsidiaries
has experienced any data breach that would violate the Privacy Rights of any Person or any Laws, except, in each case, for those, individually or in the aggregate, which have not had and would not reasonably be expected to have an IMS Health
Material Adverse Effect. The use, transfer and disclosure of, and access to, any and all data and information concerning individuals by IMS Health is in compliance with all applicable IMS Health privacy policies, terms of use, customer agreements
and Law, except as, individually or in the aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect.
(c) To the knowledge of IMS Health, neither IMS Health nor any of its Subsidiaries, Affiliates, directors, shareholders, officers or employees
has, directly or indirectly, (i) offered to pay to or solicited any remuneration from, in cash, property or in kind, or made any financial arrangements with, any past or present
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customer, physician, health care provider, supplier, contractor or third party in order to induce or directly or indirectly obtain business or payments from such person, including any item or
service for which payment may be made in whole or in part under any federal, state or private health care program, or for purchasing, leasing, ordering or arranging for or recommending, purchasing leasing, or ordering any good, facility, service or
item for which payment may be made in whole or in part under any federal, state or private health care program, in violation of any Law, (ii) given or received, or agreed to give or receive, or is aware that there has been made or that there is
any agreement to make or receive, any gift or gratuitous payment or benefit of any kind, nature or description (including in money, property or services, but not including services rendered in the ordinary course for which fair market value payment
was made by the recipient) to any past, present or potential customer, medical director, physician, health care provider, supplier or potential supplier, contractor or any other person in violation of any Law, (iii) established or maintained
any unrecorded fund or asset for any illegal purpose or made any false or artificial entries on any of its books or records for any reason or (iv) made or received or agreed to make or receive, or is aware that there has been made or received
or that there has been any intention to make or receive, any payment to any person with the intention or understanding that any part of such payment would be used for any purpose other than that described in the documents supporting such payment.
Section 3.12
Benefit Plans
.
(a) IMS Health has furnished or made available to Quintiles a true and complete list of, to the extent material, each IMS Health Plan. For
purposes of this Agreement, IMS Health Plan means each employee benefit plan (within the meaning of section 3(3) of ERISA, whether or not subject to ERISA), stock purchase, stock option, phantom stock or other equity-based,
severance, employment, consulting, retention, change-in-control, fringe benefit, bonus, incentive, deferred compensation, supplemental retirement, health, life, or disability insurance or dependent care plan, agreement (including any standard
employment agreement or executive employment agreement), program, policy or other arrangement and each other employee benefit plan, agreement, program, policy or other arrangement, in each case, whether or not subject to ERISA (including any funding
mechanism therefor now in effect or required in the future as a result of the transactions contemplated by this Agreement or otherwise), under which any current or former employee, director, independent contractor or consultant of IMS Health or its
Subsidiaries (or any of their dependents) has any present or future right to compensation or benefits or IMS Health or its Subsidiaries sponsors or maintains, is making contributions to or has any present or future liability or obligation
(contingent or otherwise) or with respect to which it is otherwise bound. With respect to each IMS Health Plan and to the extent applicable, IMS Health has provided or made available to Quintiles a current, accurate and complete copy of (i) the
plan documents and amendments thereto, (ii) any related trust agreement or other funding instrument, (iii) the most recent determination letter of the IRS, (iv) summary plan description, including any summary of material
modifications, and (v) the Form 5500 for the most recent plan year, including all schedules, financial statements and actuarial valuation reports.
(b) Neither IMS Health, its Subsidiaries nor any member of their Controlled Group (defined as any organization which is a member of a
controlled, affiliated or otherwise related group of entities within the meaning of Code Sections 414(b), (c), (m) or (o)) sponsors, maintains, contributes to or is required to contribute to or within the past six (6) years has sponsored,
maintained, contributed to or been required to contribute to: (i) a multiemployer plan (within the meaning of ERISA section 3(37)), (ii) an employee pension benefit plan, within the meaning of Section 3(2) of
ERISA (
Pension Plan
) that is subject to Title IV of ERISA or Section 412 of the Code, or (iii) a Pension Plan which is a multiple employer plan as defined in Section 413 of the Code, and no liability
(contingent or otherwise) has been incurred by any of IMS Health, its Subsidiaries or any member of their Controlled Group with respect to the foregoing that could become a material liability of the Surviving Corporation.
(c) With respect to the IMS Health Plans:
(i) each IMS Health Plan has been established and administered in all material respects in accordance with its terms and in
compliance with the applicable provisions of ERISA and the Code and all other applicable legal requirements;
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(ii) except as would not reasonably be expected to result in liability material
to IMS Health and its Subsidiaries taken as a whole, no reportable event, as defined in Section 4043 of ERISA, non-exempt prohibited transaction, as described in Section 406 of ERISA or Section 4975 of the Code, or accumulated funding
deficiency, as defined in Section 302 of ERISA and 412 of the Code, has occurred in the past six (6) years with respect to any IMS Health Plan;
(iii) each IMS Health Plan intended to be qualified under Section 401(a) of the Code is currently covered by a favorable
determination, advisory and/or opinion letter, as applicable, from the IRS that it is so qualified and, to the knowledge of IMS Health, nothing has occurred since the date of such letter that would reasonably be expected to cause the loss of the
qualified status of such IMS Health Plan;
(iv) there is no material Action (including any investigation, audit or other
administrative proceeding) by the Department of Labor, the Pension Benefit Guaranty Corporation (the
PBGC
), the IRS or any other Governmental Entity or by any plan participant or beneficiary pending, or to the knowledge of IMS
Health, threatened, relating to the IMS Health Plans, any fiduciaries thereof with respect to their duties to the IMS Health Plans or the assets of any of the trusts under any of the IMS Health Plans (other than routine claims for benefits) nor, to
the knowledge of IMS Health, are there facts or circumstances that exist that could reasonably give rise to any such actions;
(v) none of IMS Health, its Subsidiaries or any member of their Controlled Group has incurred any direct or indirect material
liability under ERISA, the Code or other applicable Laws in connection with the termination of, withdrawal from or failure to fund, any IMS Health Plan that is subject to Title IV of ERISA, and no fact or event exists that would reasonably be
expected to give rise to any such liability;
(vi) none of the IMS Health Plans currently provides any material
post-termination or retiree welfare benefits to any person for any reason, except as may be required by Section 601, et seq. of ERISA and Section 4980B(b) of the Code or other applicable similar law regarding health care coverage
continuation (collectively
COBRA
), and none of IMS Health, its Subsidiaries or any members of their Controlled Group has any material liability to provide post-termination or retiree welfare benefits to any person, except to the
extent required by COBRA;
(vii) each IMS Health Plan which is a group health plan (as such term is defined in Code
Section 5001(b) or ERISA 733, as applicable, including any plans of affiliates of IMS Health that must be taken into account under Code Sections 4980B and 4980D) is in compliance in all material respects with the applicable requirements of Code
Sections 4980B, 9801, 9802, 9803, 9811, 9812, 9813, and 9815.1, Title I, Part 6 of ERISA and Section 1862(b)(1)(A)(i) of the Social Security Act and IMS Health does not have any material liability for any excise tax imposed by Code
Section 5000 or 4980D; and
(viii) each IMS Health Plan which is a nonqualified deferred compensation plan
within the meaning of Section 409A of the Code has been operated and administered in compliance in all material respects with Section 409A of the Code and other authoritative and binding guidance thereunder since January 1, 2005 (or,
if later, the date of its adoption), and has been in documentary compliance in all material respects with Section 409A of the Code and other authoritative and binding guidance thereunder since January 1, 2009, and neither IMS Health nor
any of its Subsidiaries has any (A) material liability for withholding Taxes or penalties due under Code Section 409A or 4999 or (B) indemnity obligation for any Taxes imposed under Code Sections 409A.
(d) The execution of this Agreement and the consummation of the Merger will not, either alone or in combination with another event,
(i) entitle any current or former employee, officer, director, independent contractor or consultant of IMS Health or any of its Subsidiaries to severance pay, unemployment compensation or any other similar termination payment or any other
payment, including pursuant to any retention arrangement entered into prior to or in connection with this Agreement, or (ii) accelerate the time of payment or vesting, or increase the amount of or otherwise enhance any benefit due or require
IMS Health or any of its Subsidiaries to segregate any amount from its general assets in respect of any such employee, officer, director, independent contractor or consultant.
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(e) Neither IMS Health nor any of its Subsidiaries is a party to any agreement, contract, plan or
arrangement that could reasonably be expected, separately or in the aggregate, in connection with the transactions contemplated by this Agreement (either alone or in combination with any other events), to result in the payment of any excess
parachute payments within the meaning of Section 280G of the Code. No current or former director, officer, employee, independent contractor or consultant of IMS Health or any of its Subsidiaries is entitled to any gross-up, make-whole or
any other payment from IMS Health or any of its Subsidiaries in respect of any Tax (including Federal, state, local or foreign income, excise or other Taxes (including Taxes imposed under Section 409A or Section 4999 of the Code)) or any
interest or penalty related thereto.
Section 3.13
Labor Matters
.
(a) Except as would not reasonably be expected to be material to IMS Health and its Subsidiaries taken as a whole, (i) there are no
strikes or lockouts pending or, to the knowledge of IMS Health, threatened with respect to any employees of IMS Health or any of its Subsidiaries (
IMS Health Employees
), and there have been no such activities in the past three
(3) years, (ii) to the knowledge of IMS Health, there is no union organizing effort pending or, to the knowledge of IMS Health, threatened against IMS Health or any of its Subsidiaries, and there have been no such activities in the past
three (3) years, (iii) there is no labor dispute (other than routine individual grievances) or labor arbitration proceeding pending or, to the knowledge of IMS Health, threatened against IMS Health or any of its Subsidiaries, and there
have been no such activities in the past three (3) years, (iv) there is no slowdown or work stoppage in effect or, to the knowledge of IMS Health, threatened with respect to IMS Health Employees, and there have been no such activities in
the past three (3) years, (v) no petition has been filed or proceeding instituted by or on behalf of any labor union, works council or other employee representative organization with any Governmental Entity seeking recognition or
certification of a bargaining representative of any employees of IMS Health or any of its Subsidiaries, and (vi) there is no charge, complaint, or investigation pending or, to the knowledge of IMS Health, threatened by any Governmental Entity
against IMS Health or any of its Subsidiaries concerning any alleged violation of any applicable Law respecting employment or employment practices, including, workplace health and safety, terms and conditions of employment, wages and hours, unfair
labor practices, or employee classification.
(b)
Section 3.13(b)
of the IMS Health Disclosure Letter sets forth all material U.S.
and non-U.S. employee representative bodies, including all labor unions, labor organizations and works councils, and all collective bargaining agreements or other agreements with a labor union, works council or other employee representative
organization in effect that covers any employees of IMS Health or any of its Subsidiaries or to which IMS Health or any of its Subsidiaries is a party or otherwise bound.
(c) Except as would not reasonably be expected to have, individually or in the aggregate, an IMS Health Material Adverse Effect, IMS Health
and its Subsidiaries are in compliance with all applicable Laws respecting employment and employment practices, including, workplace health and safety, terms and conditions of employment and wages and hours, unfair labor practices, and employee
classification.
(d) Except as would not reasonably be expected to result in material liability to IMS Health and its Subsidiaries taken
as a whole, neither IMS Health nor any of its Subsidiaries has any liabilities or is in breach of any obligations under the Worker Adjustment Retraining and Notification Act of 1988, as amended (the
WARN
Act
) or any similar
state or local Law as a result of any action taken by IMS Health (other than at the written direction of Quintiles).
Section 3.14
Environmental Matters
. Neither IMS Health nor any of its Subsidiaries has received any claims, notices, demand letters or requests for information (except for such claims, notices, demand letters or requests for information the subject matter
of which has been resolved) from any federal, state, local, foreign or provincial Governmental Entity or any other Person (and to the knowledge of IMS Health, none are threatened) asserting that IMS Health or any of its Subsidiaries is in material
violation of, or has material liability under, any Environmental Law, and, except as, individually or in the aggregate, has not had and would not reasonably be
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expected to have an IMS Health Material Adverse Effect, (i) IMS Health and each of its Subsidiaries are and have been in compliance with all, and have not violated any, applicable
Environmental Laws; (ii) IMS Health and its Subsidiaries have obtained, maintained and are and have been in compliance with all Permits of all Governmental Entities and any other Person that are required under any Environmental Law;
(iii) there has been no release of any Hazardous Substance by IMS Health or any of its Subsidiaries or any other Person in any manner that has given or would reasonably be expected to give rise to any remedial or investigative obligation,
corrective action requirement or liability of IMS Health or any of its Subsidiaries under applicable Environmental Laws; (iv) no Hazardous Substance has been disposed of, arranged to be disposed of, released or transported in violation of any
applicable Environmental Law, or in a manner that has given rise to, or that would reasonably be expected to give rise to, any liability under any Environmental Law, in each case, on, at, under or from any current or former properties or facilities
owned or operated by IMS Health or any of its Subsidiaries and Hazardous Substances are not otherwise present at or about any such properties or facilities in amount or condition that has resulted in or would reasonably be expected to result in
liability to IMS Health or any of its Subsidiaries under any Environmental Law; and (v) neither IMS Health, its Subsidiaries nor any of their respective properties or facilities are subject to, or, to the knowledge of IMS Health, are threatened
to become subject to, any liabilities relating to any suit, settlement, court order, administrative order, regulatory requirement, judgment or claim asserted or arising under any Environmental Law or any agreement relating to environmental
liabilities.
Section 3.15
Taxes
.
(a) Except as would not reasonably be expected to have, individually or in the aggregate, an IMS Health Material Adverse Effect:
(i) all Tax Returns required to be filed by or on behalf of IMS Health and each of its Subsidiaries have been prepared and
timely filed with the appropriate Governmental Entity (taking into account any valid extensions of time within which to file) and all such filed Tax Returns are complete and accurate,
(ii) all Taxes required to be paid by or on behalf of IMS Health and each of its Subsidiaries have been timely paid with the
appropriate Governmental Entity, and all Taxes that have accrued but are not yet payable have been reserved for in accordance with GAAP in IMS Healths financial statements included in IMS Healths SEC Documents or have been incurred in
the ordinary course of business since the date of the most recent period covered by the financial statements included in IMS Healths SEC Documents,
(iii) all deficiencies asserted or assessed by a Governmental Entity against IMS Health or any of its Subsidiaries have been
paid in full or are adequately reserved in accordance with GAAP,
(iv) there are no pending or, to the knowledge of IMS
Health, threatened Actions relating to Taxes and there are no currently effective waivers (or requests for waivers) of the time to assess any Taxes,
(v) there are no Liens for Taxes on any of the assets of IMS Health or any of its Subsidiaries other than Permitted Liens,
(vi) neither IMS Health nor any of its Subsidiaries has any liability for Taxes of any other person (other than IMS Health and
its Subsidiaries) pursuant to Treasury Regulation Section 1.1502-6 (or any similar provision of state, local or foreign Law), as a transferee or successor, or by Contract, and
(vii) IMS Health and its Subsidiaries have complied with all applicable Laws relating to the payment, collection and
withholding of Taxes and paid over to the appropriate Governmental Entity all amounts required to be so withheld or collected and paid under all applicable Laws.
(b) Neither IMS Health nor any of its Subsidiaries has been a controlled corporation or a distributing corporation in
any distribution occurring during the three-year period ending on the date hereof (or otherwise as part of a plan (or series of related transactions) within the meaning of Section 355(e) of the Code of which the Merger is also a
part) that was purported or intended to be governed by Section 355 of the Code.
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(c) During the five-year period ending on the date hereof, neither IMS Health nor any of its
Subsidiaries has been included in a consolidated, unitary or combined Tax Return under U.S. federal, state, local or foreign Law with respect to Taxes for any taxable period (other than a group of which IMS Health
or any of its Subsidiaries was the common parent).
(d) Neither IMS Health nor any of its Subsidiaries is a party to or is bound by any
Tax sharing, allocation or indemnification agreement (other than agreements entered into in the ordinary course of business the primary purpose of which is not the sharing of Taxes, such as leases, vendor and customer agreements, credit agreements
and purchase agreements).
(e) Neither IMS Health nor any of its Subsidiaries has participated in any listed transaction
within the meaning of Treasury Regulation Section 1.6011-4(b)(2).
(f) Neither IMS Health nor any of its Subsidiaries has taken or
agreed to take (or failed to take or agreed to take) any action or knows of any facts or circumstances that would reasonably be expected to prevent the Merger from qualifying as a reorganization within the meaning of Section 368(a) of the Code.
Section 3.16
Contracts
.
(a)
Section 3.16
of the IMS Health Disclosure Letter lists each Contract, other than any Contract that is listed as an exhibit to
IMS Healths annual report on Form 10-K for the year ended December 31, 2015 or IMS Healths quarterly report on Form 10-Q for the quarter ended March 31, 2016, in each case, without giving effect to any amendment thereto filed
on or after the date hereof (such contracts, the
IMS Health Public Contracts
), of the following types to which IMS Health or any of its Subsidiaries is a party or by which any of their respective properties or assets is bound:
(i) any partnership, joint venture, strategic alliance or collaboration Contract which is material to IMS Health and its
Subsidiaries, taken as a whole;
(ii) any non-competition agreement, exclusivity, non-solicitation or any other agreement
or obligation which purports to limit or restrict in any material respect the manner in which, or the localities in which, all or any material portion of the businesses of IMS Health and its Subsidiaries, taken as a whole, is or would be conducted;
(iii) any Contract relating to Indebtedness and having an outstanding principal amount in excess of $10,000,000, other
than Contracts solely among IMS Health and/or wholly-owned Subsidiaries of IMS Health;
(iv) each Contract relating to the
acquisition or disposition of assets or stock that contains representations, covenants, indemnities or other obligations (including earn-out or other contingent payment obligations) that would reasonably be expected to result in the
receipt or making of future payments in excess of $10,000,000 in the twelve (12) month period following the date hereof;
(v) each Contract between IMS Health, on the one hand, and any officer, director or affiliate (other than a wholly-owned
Subsidiary of IMS Health) of IMS Health or any of their respective associates or immediate family members (as such terms are defined in Rule 12b-2 and Rule 16a-1 of the Exchange Act), on the other hand, including any Contract
pursuant to which IMS Health has an obligation to indemnify such officer, director, affiliate or family member;
(vi) any
shareholders, investor rights, registration rights or similar agreement or arrangement of IMS Health or any of its Subsidiaries;
(vii) any Contract that relates to any swap, forward, futures, or other similar derivative transaction with a notional value in
excess of $10,000,000;
(viii) any collective bargaining agreement or other Contract with any labor union, works council or
other employee representative organization;
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(ix) any lease or amendment to the terms of any existing lease of real property
that would require payments over the remaining term of such lease in excess of $25,000,000; and
(x) any Contract that
would be required to be filed by IMS Health as a material contract pursuant to Item 601(b)(10) of Regulation S-K under the Securities Act or disclosed by IMS Health on a Current Report on Form 8-K.
Each IMS Health Public Contract, together with any contract of the type described in clauses (i) through (x), is referred to herein as an
IMS Health Material Contract
.
(b) (i) Each IMS Health Material Contract is valid and binding on IMS Health and any of
its Subsidiaries to the extent such Subsidiary is a party thereto, as applicable, and to the knowledge of IMS Health, each other party thereto, and is in full force and effect and enforceable in accordance with its terms, except where the failure to
be valid, binding, enforceable and in full force and effect, individually or in the aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect; (ii) IMS Health and each of its Subsidiaries, and, to
the knowledge of IMS Health, each other party thereto, has performed all obligations required to be performed by it under each IMS Health Material Contract, except where any noncompliance, individually or in the aggregate, has not had and would not
reasonably be expected to have an IMS Health Material Adverse Effect; and (iii) there is no default under any IMS Health Material Contract by IMS Health or any of its Subsidiaries or, to the knowledge of IMS Health, any other party thereto, and
no event or condition has occurred that constitutes, or, after notice or lapse of time or both, would constitute, a default on the part of IMS Health or any of its Subsidiaries or, to the knowledge of IMS Health, any other party thereto under any
such IMS Health Material Contract, nor has IMS Health or any of its Subsidiaries received any notice of any such default, event or condition, except where any such default, event or condition, individually or in the aggregate, has not had and would
not reasonably be expected to have an IMS Health Material Adverse Effect. IMS Health has made available to Quintiles true and complete copies of all IMS Health Material Contracts, including all amendments thereto.
(c) The reasonably expected future payments of IMS Health and its Subsidiaries pursuant to all Contracts for the acquisition or disposition of
assets or stock that contain representations, covenants, indemnities or other obligations (including earn-out or other contingent payment obligations) to which IMS Health or any of its Subsidiaries is a party, does not exceed $30,000,000
in the aggregate.
Section 3.17
Insurance
. Except as, individually or in the aggregate, has not had or would not reasonably be
expected to have an IMS Health Material Adverse Effect, with respect to each insurance policy covering IMS Health and its Subsidiaries, (a) such policy is in full force and effect and all premiums due thereon have been paid, (b) neither
IMS Health nor any of its Subsidiaries is in breach or default, and has not taken any action or failed to take any action which (with or without notice or lapse of time, or both) would constitute such a breach or default, or would permit termination
or modification of, any such policy, (c) to the knowledge of IMS Health, no insurer issuing any such policy has been declared insolvent or placed in receivership, conservatorship or liquidation, (d) no notice of cancellation or termination
has been received with respect to any such policy, nor will any such cancellation or termination result from the consummation of the transactions contemplated hereby and (e) the insurance policies are sufficient for compliance by IMS Health
with all applicable Laws or obligations with respect to IMS Health Material Contracts to maintain insurance to which IMS Health is a party.
Section 3.18
Properties
. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have an
IMS Health Material Adverse Effect, (a) IMS Health and each of its Subsidiaries has good and marketable fee title (or the equivalent in any applicable foreign jurisdiction) to each and all of its owned real property, and good and valid
leasehold title to all of its leased property pursuant to leases with third parties which are enforceable in accordance with their terms, in each case subject only to Permitted Liens, (b) all such real property (i) complies with all
applicable zoning and land use ordinances, laws and regulations, or is a valid nonconforming use thereunder, (ii) has sufficient access to a public road and (iii) is improved with all necessary
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and sufficient buildings, structures and improvements sufficient for the continuation of its business as currently conducted, in accordance with all applicable Permits and applicable Laws with
respect to IMS Health and its Subsidiaries, (c) there are no existing (or to the knowledge of IMS Health threatened in writing) condemnation proceedings with respect to any such real property and (d) with respect to all such leased real
property, IMS Health and each of its Subsidiaries is in compliance with all material terms and conditions of each lease therefor, and neither IMS Health nor any of its Subsidiaries has received any notice of default thereunder which is outstanding
and remains uncured beyond any applicable period of cure.
Section 3.19
Intellectual Property
. Except as, individually or in
the aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect, either IMS Health or a Subsidiary of IMS Health owns, or is licensed or otherwise possesses adequate rights to use (in the manner and to
the extent it has used the same), all trademarks or servicemarks (whether registered or unregistered), trade names, domain names, copyrights (whether registered or unregistered), patents, trade secrets or other intellectual property of any kind used
in their respective businesses as currently conducted (collectively, the
IMS Health Intellectual Property
). No single item of IMS Health Intellectual Property owned by IMS Health or any of its Subsidiaries is material to the
operation of their businesses. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect, IMS Health or one of its Subsidiaries is listed as the owner of record for
each item of registered IMS Health Intellectual Property, and pending applications therefor, that IMS Health and its Subsidiaries owns or purports to own (collectively, the
IMS Health Registered Intellectual Property
) with the
relevant patent, trademark, copyright, domain name, or other authority in the United States or foreign jurisdiction, as the case may be. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have an IMS
Health Material Adverse Effect, all of the IMS Health Registered Intellectual Property is valid, enforceable and subsisting and there are no challenges to the ownership, use, validity or enforceability of the IMS Health Registered Intellectual
Property. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have an IMS Health Material Adverse Effect, (a) there are no pending claims or claims threatened in writing by any Person alleging
infringement, misappropriation or dilution by IMS Health or any of its Subsidiaries of the intellectual property rights of any Person; (b) the conduct of the businesses of IMS Health and its Subsidiaries has not infringed, misappropriated or
diluted, and does not infringe, misappropriate or dilute, any intellectual property rights of any Person; (c) neither IMS Health nor any of its Subsidiaries has made any claim of infringement, misappropriation or other violation by others of
its rights to or in connection with IMS Health Intellectual Property; (d) to the knowledge of IMS Health, no Person is infringing, misappropriating or diluting any IMS Health Intellectual Property; (e) IMS Health and its Subsidiaries have
taken reasonable steps to protect the confidentiality of their trade secrets and the security of their computer systems and networks; and (f) the consummation of the transactions contemplated by this Agreement will not result in the loss of, or
give rise to any right of any third party to terminate any of IMS Healths or any Subsidiaries rights or obligations under, any agreement under which IMS Health or any of its Subsidiaries grants to any Person, or any Person grants to IMS
Health or any of its Subsidiaries, a license or right under or with respect to any IMS Health Intellectual Property.
Section 3.20
State Takeover Statutes
. As of the date hereof and at all times on or prior to the Effective Time, the Board of Directors of IMS Health has taken all actions so that the restrictions applicable to business combinations contained in
Section 203 of the DGCL are, and will be, inapplicable to the execution, delivery and performance of this Agreement and the timely consummation of the Merger and the other transactions contemplated hereby. No other moratorium,
fair price, business combination, control share acquisition or similar provision of any state anti-takeover Law (collectively,
Takeover Laws
) or any similar anti-takeover provision in the IMS
Health Charter or IMS Health Bylaws is, or at the Effective Time will be, applicable to this Agreement, the Merger or any of the other transactions contemplated hereby.
Section 3.21
Affiliate Transactions
. There are no transactions or Contracts between IMS Health or any of its Subsidiaries, on the
one hand, and any of IMS Healths Affiliates (other than wholly-owned Subsidiaries of IMS Health), on the other hand, that would be required to be disclosed by IMS Health under Item 404 of Regulation S-K under the Securities Act that have
not been disclosed in the IMS Health SEC Documents.
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Section 3.22
Anti-Bribery Laws
. IMS Health and its Affiliates, directors, officers
and employees have complied in all material respects with the FCPA, the Anti-Kickback Act of 1986, as amended, the U.K. Bribery Act 2010, as amended, the Organization for Economic Cooperation and Development Convention Against Bribery of Foreign
Officials in International Business Transactions and all legislation implementing such convention and all other international anti-bribery conventions, and all other anti-corruption and bribery Laws (including any applicable written standards,
requirements, directives or policies of any Governmental Entity) (collectively, the
Anti-Bribery Laws
). IMS Health and its Affiliates have developed and implemented an Anti-Bribery Law compliance program which includes corporate
policies and procedures designed to ensure compliance in all material respects with the Anti-Bribery Laws. Except for facilitating payments (as such term is defined in the FCPA and other applicable Laws), to the knowledge of IMS Health,
neither IMS Health nor any of its Affiliates, directors, officers, employees, agents or other representatives acting on its behalf have directly or indirectly (a) used any corporate funds for unlawful contributions, gifts, entertainment or
other unlawful expenses relating to political activity, (b) offered, promised, paid or delivered any fee, commission or other sum of money or item of value, however characterized, to any finder, agent or other party acting on behalf of a
governmental or political employee or official or governmental or political entity, political agency, department, enterprise or instrumentality, in the United States or any other country, that was illegal under any applicable Law, (c) made any
payment to any customer or supplier, or to any officer, director, joint venture partner, employee or agent of any such customer or supplier, for the unlawful sharing of fees or unlawful rebating of charges, (d) engaged in any other unlawful
reciprocal practice, or made any other unlawful payment or given any other unlawful consideration to any such customer or supplier or any such officer, director, joint venture partner, employee or agent of the customer or supplier, or (e) taken
any action or made any omission in violation of any applicable Law governing imports into or exports from the United States or any foreign country, or relating to economic sanctions or embargoes, corrupt practices, money laundering or compliance
with unsanctioned foreign boycotts.
Section 3.23
Brokers
. No broker, investment banker, financial advisor or other Person,
other than Goldman, Sachs & Co. (the
IMS Health Financial Advisor
), the fees and expenses of which will be paid by IMS Health, is entitled to any brokers, finders, financial advisors or other similar fee
or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of IMS Health or any of its Affiliates.
Section 3.24
Opinion of Financial Advisor
. The IMS Health Board has received an oral opinion (to be confirmed in writing) of the
IMS Health Financial Advisor, dated the date of this Agreement, to the effect that, as of such date and subject to the assumptions, limitations, qualifications and other matters set forth in the written opinion of the IMS Health Financial Advisor,
the Exchange Ratio pursuant to this Agreement is fair, from a financial point of view, to the holders of shares of IMS Health Common Stock. A signed true and complete copy of such opinion has been or will promptly be provided to Quintiles for
informational purposes following receipt thereof by the IMS Health Board.
Section 3.25
Debt Financing
.
(a) IMS Health has delivered to Quintiles true, correct and complete copies, as of the date of this Agreement, of the Commitment Letter and
the Fee Letter to provide the Debt Financing. As of the date of this Agreement (i) the Commitment Letter and the Fee Letter have not been amended or modified, and no such amendment or modification is contemplated (except as expressly provided
therein), and (ii) the obligations and commitments contained in the Commitment Letter have not been withdrawn, modified or rescinded in any respect. As of the date hereof, the Commitment Letter is (x) a valid and binding obligation of IMS
Health and, to the knowledge of IMS Health, of each of the other parties thereto, in each case, except (A) to the extent that enforceability may be limited by the applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or similar Laws from time to time in effect affecting generally the enforcement of creditors rights and remedies and principles of equity and (B) that the availability of equitable remedies, including specific performance, is
subject to the discretion of the court before which any proceeding may be brought and (y) in full force and effect.
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(b) As of the date of this Agreement, no event has occurred that, with or without notice, lapse
of time or both, would reasonably be expected to constitute (i) a default or breach on the part of IMS Health or, to the knowledge of IMS Health, any other parties thereto, under the Commitment Letter, in each case, that would adversely affect
or delay in any material respect the availability of the Debt Financing at Closing or (ii) assuming (x) no breach by Quintiles or its Subsidiaries of their respective representations and/or obligations, in either case, such that the
closing conditions set forth in
Section 6.3(a)
or
6.3(b)
would fail to be satisfied, (y) compliance by Quintiles and its Subsidiaries with
Section 5.18(b)
and (z) the satisfaction of the conditions set forth
in
Section 6.1
, any failure to satisfy a condition precedent under the Commitment Letter. As of the date of this Agreement, the Commitment Letter contains all of the conditions precedent to the obligations of the parties thereunder to
make the Debt Financing available to IMS Health on the terms therein and all of the provisions that would permit the Lenders to reduce the total amount of the Debt Financing. As of the date of this Agreement, other than the Commitment Letter and the
Fee Letter, there are no side letters or other agreements, contracts or arrangements to which IMS Health or any of its affiliates is a party related to the funding of the full amount of the Debt Financing provided under the Commitment Letter.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF QUINTILES
Except (a) as disclosed or reflected in the Quintiles SEC Documents filed prior to the date of this Agreement (but excluding any risk
factor disclosures contained under the heading Risk Factors, any disclosure of risks included in any forward-looking statements disclaimer or any other statements that are similarly predictive or forward-looking in nature, in
each case, other than any specific factual information contained therein), or (b) as set forth in the disclosure letter delivered by Quintiles to IMS Health prior to the execution of this Agreement (the
Quintiles Disclosure
Letter
) (it being agreed that the disclosure of any information in a particular section or subsection of the Quintiles Disclosure Letter shall be deemed disclosure with respect to any other section or subsection of this Agreement to which
the relevance of such information is reasonably apparent), Quintiles represents and warrants to IMS Health as follows:
Section 4.1
Organization, Standing and Power
.
(a) Each of Quintiles and its Subsidiaries (i) is an entity duly organized, validly
existing and in good standing (with respect to jurisdictions that recognize such concept or equivalent) under the Laws of the jurisdiction of its organization, (ii) has all requisite corporate or similar power and authority to own, lease and
operate its properties and to carry on its business as now being conducted and (iii) is duly qualified or licensed to do business and is in good standing (with respect to jurisdictions that recognize such concept or equivalent) in each
jurisdiction in which the nature of its business or the ownership, leasing or operation of its properties makes such qualification or licensing necessary, except, with respect to clause (i) only as it relates to Subsidiaries and clauses
(ii) and (iii), for any such failures to have such power or authority or to be so qualified or licensed or in good standing, individually or in the aggregate, as have not had and would not reasonably be expected to have a Quintiles Material
Adverse Effect.
(b) Quintiles has previously furnished or otherwise made available to IMS Health true and complete copies of
Quintiles articles of incorporation (the
Quintiles Charter
) and bylaws (the
Quintiles Bylaws
), in each case as amended to the date of this Agreement, and each as so delivered is in full force and effect.
Section 4.2
Capital Stock
.
(a) The authorized capital stock of Quintiles consists of 300,000,000 shares of Quintiles Common Stock (except, as of the Closing Date, as may
otherwise be set forth in the Converted Entity Charter) and 1,000,000 shares of preferred stock, par value $0.01 per share (the
Quintiles Preferred Stock
). As of the close of business on the Measurement Date, (i) 119,668,726
shares of Quintiles Common Stock were issued and outstanding, (ii) no shares of Quintiles Preferred Stock were issued and outstanding, (iii) 14,148,064 shares of Quintiles Common Stock were reserved and available for issuance pursuant to Quintiles
Equity Plans; of which
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7,909,896 shares of Quintiles Common Stock were subject to issuance pursuant to outstanding equity awards of Quintiles pursuant to Quintiles Equity Plans, comprised of (A) 7,142,729 shares of
Quintiles Common Stock were subject to issuance pursuant to the exercise of outstanding options (each, a
Quintiles Option
) to purchase shares of Quintiles Common Stock granted under the Quintiles Equity Plans, (B) restricted stock
unit awards (
Quintiles RSUs
) representing the right to receive up to 597,661 shares of Quintiles Common Stock were outstanding and (C) performance units (
Quintiles PSUs
) representing the right to receive up to
169,506 shares of Quintiles Common Stock were outstanding, and (iv) 2,311,117 shares of Quintiles Common Stock were reserved and available for issuance under the Quintiles employee stock purchase plan. Additionally, as of the close of business
on the Measurement Date, 555,901 shares of Quintiles Common Stock were underlying outstanding Quintiles stock appreciation rights (
Quintiles SARs
), which Quintiles SARs are settled in cash. All outstanding shares of capital stock
of Quintiles are, and all shares reserved for issuance will be, when issued, duly authorized, validly issued, fully paid and nonassessable and not subject to or issued in violation of any purchase option, call option, right of first refusal,
preemptive right, subscription right or any similar right under any provision of the NCBCA, the Quintiles Charter, the Quintiles Bylaws or any Contract to which Quintiles is a party or is otherwise bound. No shares of capital stock of Quintiles are
owned by any Subsidiary of Quintiles. All outstanding shares of capital stock and other voting securities or equity interests of each Subsidiary of Quintiles have been duly authorized and validly issued, are fully paid, nonassessable and not subject
to any preemptive rights. All outstanding shares of capital stock and other voting securities or equity interests of each such Subsidiary are owned, directly or indirectly, by Quintiles, free and clear of all Liens.
(b) Except as set forth above and except for changes since the Measurement Date resulting from the exercise or vesting of awards made under
the Quintiles Equity Plans outstanding on such date, as of the date of this Agreement, (i) there are not outstanding or authorized any (A) shares of capital stock or other voting securities of Quintiles, (B) securities of Quintiles
convertible into or exchangeable for shares of capital stock or voting securities of Quintiles or (C) options or other rights to acquire from Quintiles, and no obligation of Quintiles to issue, any capital stock, voting securities or securities
convertible into or exchangeable for capital stock or voting securities of Quintiles, (ii) there are no outstanding obligations of Quintiles to repurchase, redeem or otherwise acquire any capital stock, voting securities or securities
convertible into or exchangeable for capital stock or voting securities of Quintiles and (iii) there are no other options, calls, warrants or other rights, agreements, arrangements or commitments of any character relating to the issued or
unissued capital stock of Quintiles or any of its Subsidiaries to which Quintiles or any of its Subsidiaries is a party.
Section 4.3
Subsidiaries
. Exhibit 21.1 to the Annual Report on Form 10-K filed by Quintiles with the SEC on February 11, 2016 (without giving effect to any amendment filed on or after the date hereof) sets forth a true and complete list of each
material Subsidiary of Quintiles. All outstanding shares of capital stock, or other equity or voting interests in, each Subsidiary of Quintiles are, and all shares reserved for issuance will be, when issued, duly authorized, validly issued, fully
paid and nonassessable and not subject to or issued in violation of any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the NCBCA, its articles of incorporation
or bylaws or comparable organizational documents, or any Contract to which Quintiles is a party or is otherwise bound. Except for the capital stock of, or other equity or voting interests in, its Subsidiaries, Quintiles does not own, directly or
indirectly, any equity, membership interest, partnership interest, joint venture interest, or other equity or voting interest in, or any interest convertible into, exercisable or exchangeable for any of the foregoing, nor is it under any current or
prospective obligation to form or participate in, provide funds to, make any loan, capital contribution, guarantee, credit enhancement or other investment in, any Person.
Section 4.4
Authority
.
(a) Quintiles has all necessary corporate power and authority to execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement by Quintiles and the consummation by Quintiles of the transactions contemplated hereby have been duly authorized by all necessary corporate
action on the part of Quintiles and no
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other corporate proceedings on the part of Quintiles are necessary to approve this Agreement or to consummate the Merger and the other transactions contemplated hereby, subject, in the case of
the consummation of the Merger and the other transactions contemplated hereby, to (i) the approval of this Agreement by the holders of a majority of all the votes entitled to be cast thereon by holders of shares of Quintiles Common Stock, (ii) the
approval of the issuance of shares of Quintiles Common Stock in connection with the Merger as contemplated by this Agreement by the affirmative vote of the holders of outstanding Quintiles Common Stock representing a majority of the votes cast with
respect to such approval, (iii) the approval of the Plan of Conversion by the holders of a majority of all the votes entitled to be cast thereon by holders of shares of Quintiles Common Stock and (iv) the approval of the Converted Entity
Charter in connection with the Conversion, or one or more of the provisions thereof, by the holders of a majority of all the votes entitled to be cast thereon by holders of shares of Quintiles Common Stock;
provided
,
however
, that any
such approvals referred to in the foregoing clauses (i) - (iv) shall be unbundled into separate proposals to the extent required by applicable Law (collectively, the
Quintiles Stockholder Approval
). This Agreement has been
duly executed and delivered by Quintiles and, assuming the due authorization, execution and delivery by IMS Health, constitutes a valid and binding obligation of Quintiles, enforceable against Quintiles in accordance with its terms (except to the
extent that enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization or similar Laws affecting the enforcement of creditors rights generally or by general principles of equity).
(b) The Board of Directors of Quintiles (the
Quintiles Board
), at a meeting duly called and held at which all directors of
Quintiles were present, duly and unanimously (of those voting) adopted resolutions (i) determining that the terms of this Agreement, the Merger and the other transactions contemplated hereby, including the Plan of Conversion and the Conversion,
are fair to and in the best interests of Quintiles stockholders, (ii) approving and declaring advisable this Agreement and the Plan of Conversion and the transactions contemplated hereby and thereby, including the Merger and the
Conversion, (iii) directing that this Agreement and the Plan of Conversion be submitted to the stockholders of Quintiles for approval and (iv) resolving to recommend that Quintiles stockholders vote in favor of the approval of this
Agreement and the Plan of Conversion and the transactions contemplated hereby and thereby, including the Merger and the Conversion, which resolutions have not been subsequently rescinded, modified or withdrawn in any way, except as may be permitted
by
Section 5.2
.
(c) The votes comprising the Quintiles Stockholder Approval are the only votes of the holders of any class or
series of Quintiles capital stock or other securities required in connection with the consummation of the Merger and the Conversion. No vote of the holders of any class or series of Quintiles capital stock or other securities is required
in connection with the consummation of any of the transactions contemplated hereby to be consummated by Quintiles other than the Merger and the Conversion.
Section 4.5
No Conflict; Consents and Approvals
.
(a) The execution, delivery and performance of this Agreement by Quintiles does not, and the consummation of the Merger and the other
transactions contemplated hereby and compliance by Quintiles with the provisions hereof will not, conflict with, or result in any violation or breach of, or default (with or without notice or lapse of time, or both) under, or give rise to a right
of, or result in, termination, cancellation, modification or acceleration of any obligation or to the loss of a material benefit under, or result in the creation of any Lien in or upon any of the properties, assets or rights of Quintiles or any of
its Subsidiaries under, or give rise to any increased, additional, accelerated or guaranteed rights or entitlements under, or require any consent, waiver or approval of any Person pursuant to, any provision of (i) the Quintiles Charter or
Quintiles Bylaws, or the articles of incorporation or bylaws (or similar organizational documents) of any Subsidiary of Quintiles, (ii) any Contract to which Quintiles or any of its Subsidiaries is a party or by which Quintiles or any of its
Subsidiaries or any of their respective properties or assets may be bound or (iii) subject to receipt of the Quintiles Stockholder Approval and the governmental filings and other matters referred to in
Section 4.5(b)
, any Law or any
rule or regulation of the NYSE applicable to Quintiles or any of its Subsidiaries or by which Quintiles or any
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of its Subsidiaries or any of their respective properties or assets may be bound, except, in the case of clauses (ii) and (iii), as, individually or in the aggregate, has not had and would
not reasonably be expected to have a Quintiles Material Adverse Effect.
(b) No consent, approval, order or authorization of, or
registration, declaration, filing with or notice to, any Governmental Entity is required by or with respect to Quintiles or any of its Subsidiaries in connection with the execution, delivery and performance of this Agreement by Quintiles or the
consummation by Quintiles of the Merger and the other transactions contemplated hereby or compliance with the provisions hereof, except for (i) as required under the HSR Act or under any other applicable Antitrust Law, (ii) such filings
and reports as may be required pursuant to the applicable requirements of the Securities Act, the Exchange Act and any other applicable state or federal securities, takeover and blue sky laws, (iii) the filing of the Certificate of
Merger with the Delaware Secretary of State, as required by the DGCL, (iv) the filing of the Certificate of Conversion (as defined in the Plan of Conversion) with the Delaware Secretary of State, as required by the DGCL, and the Articles of
Conversion (as defined in the Plan of Conversion) with the Secretary of State of the State of North Carolina (the
North Carolina Secretary of State
), as required by the NCBCA, (v) any filings and approvals required under the
rules and regulations of NYSE and (vi) such other consents, approvals, orders, authorizations, registrations, declarations, filings or notices the failure of which to be obtained or made, individually or in the aggregate, have not had or would
not reasonably be expected to have a Quintiles Material Adverse Effect.
Section 4.6
SEC Reports; Financial Statements; Internal
Controls
.
(a) Quintiles has filed with or furnished to the SEC on a timely basis true and complete copies of all forms, reports,
schedules, statements and other documents required to be filed with or furnished to the SEC by Quintiles since January 1, 2014 (all such documents, together with all exhibits and schedules to the foregoing materials and all information
incorporated therein by reference, the
Quintiles SEC Documents
). As of their respective filing dates (or, if amended or superseded by a filing prior to the date of this Agreement, then on the date of such filing), the Quintiles
SEC Documents complied in all material respects with the applicable requirements of the Securities Act, the Exchange Act and the Sarbanes-Oxley Act, as the case may be, including, in each case, the rules and regulations promulgated thereunder, and
none of the Quintiles SEC Documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(b) The financial statements (including the related notes and schedules thereto) included (or
incorporated by reference) in the Quintiles SEC Documents (i) have been prepared in a manner consistent with the books and records of Quintiles and its Subsidiaries, (ii) have been prepared in accordance with GAAP (except, in the case of
unaudited statements, as permitted by Form 10-Q of the SEC) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto), (iii) comply as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect thereto and (iv) fairly present in all material respects the consolidated financial position of Quintiles and its Subsidiaries as of the dates thereof and their
respective consolidated results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal and recurring year-end audit adjustments that were not, or are not expected to be, material in amount),
all in accordance with GAAP and the applicable rules and regulations promulgated by the SEC. Since December 31, 2015, Quintiles has not made any change in the accounting practices or policies applied in the preparation of its financial
statements, except as required by GAAP, SEC rule or policy or applicable Law. The books and records of Quintiles and its Subsidiaries have been, and are being, maintained in all material respects in accordance with GAAP (to the extent applicable)
and any other applicable legal and accounting requirements and reflect only actual transactions.
(c) Quintiles has established and
maintains disclosure controls and procedures and internal control over financial reporting (as such terms are defined in paragraphs (e) and (f), respectively, of Rule 13a-15 under the Exchange Act) as required by Rule 13a-15 under the Exchange
Act. Quintiles disclosure controls and
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procedures are designed to provide reasonable assurance that all material information required to be disclosed by Quintiles in the reports that it files or furnishes under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that all such material information is accumulated and communicated to Quintiles management as appropriate to allow timely
decisions regarding required disclosure and to make the certifications required pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act. Quintiles management has completed an assessment of the effectiveness of Quintiles disclosure
controls and procedures in accordance with Rule 13a-15 and, to the extent required by applicable Law, presented in any applicable Quintiles SEC Document that is a report on Form 10-K or Form 10-Q its conclusions about the effectiveness of the
disclosure controls and procedures as of the end of the period covered by such report based on such evaluation. Based on Quintiles managements most recently completed evaluation of Quintiles internal control over financial
reporting prior to the date of this Agreement, (i) to the knowledge of Quintiles, Quintiles had no significant deficiencies or material weaknesses in the design or operation of its internal control over financial reporting that would reasonably
be expected to adversely affect Quintiles ability to record, process, summarize and report financial information and (ii) Quintiles does not have knowledge of any fraud, whether or not material, that involves management or other employees
who have a significant role in Quintiles internal control over financial reporting.
(d) To the knowledge of Quintiles, as of the
date of this Agreement, there are no SEC inquiries or investigations, other governmental inquiries or investigations or internal investigations pending or threatened, in each case regarding any accounting practices of Quintiles.
Section 4.7
No Undisclosed Liabilities
. Neither Quintiles nor any of its Subsidiaries has any liabilities or obligations of any
nature, whether accrued, absolute, contingent or otherwise, and whether or not required to be recorded or reflected on a balance sheet under GAAP, except (a) to the extent disclosed, reflected, accrued or reserved against in the audited
consolidated balance sheet of Quintiles and its Subsidiaries as at December 31, 2015 included in the Annual Report on Form 10-K filed by Quintiles with the SEC on February 11, 2016 (without giving effect to any amendment thereto filed on
or after the date hereof) and (b) for liabilities and obligations incurred in the ordinary course of business consistent with past practice since December 31, 2015 that would not, individually or in the aggregate, reasonably be expected to
have a Quintiles Material Adverse Effect.
Section 4.8
Certain Information
. None of the information supplied or to be supplied
by or on behalf of Quintiles specifically for inclusion or incorporation by reference in the Form S-4 will, at the time the Form S-4 is filed with the SEC, at the time of any amendment or supplement thereto and at the time it (or any post-effective
amendment or supplement) becomes effective under the Securities Act, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. The
Joint Proxy Statement/Prospectus will not, at the time it is first mailed to Quintiles stockholders, at the time of any amendments or supplements thereto and at the time of the Quintiles Stockholders Meeting, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they are made, not misleading. The Joint Proxy Statement/Prospectus will comply
as to form in all material respects with the provisions of the Exchange Act. Notwithstanding the foregoing, Quintiles makes no representation or warranty with respect to statements included or incorporated by reference in the Form S-4 or the Joint
Proxy Statement/Prospectus based on information supplied in writing by or on behalf of IMS Health specifically for inclusion or incorporation by reference therein.
Section 4.9
Absence of Certain Changes or Events
. Since December 31, 2015 through the date of the Agreement: (a) there
has not been any change, occurrence, state of fact, event or development or prospective change, event or development that, individually or in the aggregate, has had or would reasonably be expected to have a Quintiles Material Adverse Effect, and
(b) except as otherwise contemplated or permitted by this Agreement, (i) Quintiles and its Subsidiaries have conducted their businesses in all material respects only in the ordinary course consistent with past practice; and
(ii) neither Quintiles nor any of its Subsidiaries has suffered any loss, damage, destruction or other casualty affecting any of its material properties or assets, whether or not covered by insurance.
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Section 4.10
Litigation
. As of the date hereof, there is no Action (or basis
therefor) pending or, to the knowledge of Quintiles, threatened against or affecting Quintiles or any of its Subsidiaries or any of their respective properties or assets, other than any Action that, individually or in the aggregate, has not had and
would not reasonably be expected to have a Quintiles Material Adverse Effect. As of the date hereof, neither Quintiles nor any of its Subsidiaries nor any of their respective properties or assets is subject to any outstanding judgment, order,
injunction, rule or decree of any Governmental Entity that, individually or in the aggregate, has had or would reasonably be expected to have a Quintiles Material Adverse Effect. As of the date hereof, there is no Action pending or, to the knowledge
of Quintiles, threatened seeking to prevent, hinder, modify, delay or challenge the Merger or any of the other transactions contemplated by this Agreement.
Section 4.11
Compliance with Laws; Permits
.
(a) Quintiles and each of its Subsidiaries are and, at all times since January 1, 2013 have been, in compliance with all Laws applicable
to their businesses, operations, properties or assets, including all healthcare Laws, except where any non-compliance, individually or the aggregate, has not had and would not reasonably be expected to have a Quintiles Material Adverse Effect. None
of Quintiles or any of its Subsidiaries has received, since January 1, 2013, a notice or other written communication alleging or relating to a possible material violation of any Law, including any healthcare Law, applicable to their businesses,
operations, properties or assets, which alleged violation has not been materially resolved and which, individually or in the aggregate has had or would reasonably be expected to have a Quintiles Material Adverse Effect. Quintiles and each of its
Subsidiaries have in effect all Permits of all Governmental Entities necessary or advisable for them to own, lease or operate their properties and assets and to carry on their businesses as now conducted, except for any Permits the absence of which
would not, individually or in the aggregate, reasonably be expected to have a Quintiles Material Adverse Effect. All such Permits are in full force and effect, except where the failure to be in full force and effect would not, individually or in the
aggregate, reasonably be expected to have a Quintiles Material Adverse Effect.
(b) Without limiting the generality of the foregoing,
except as, individually or the aggregate, has not had and would not reasonably be expected to have a Quintiles Material Adverse Effect, Quintiles (i) does not itself and does not permit or assist any third party to violate the rights of any
Person, or the contractual obligations of Quintiles or any of its Subsidiaries, with respect to confidential, personally identifiable or personal health information, including all Privacy Rights, (ii) has implemented reasonable technical,
physical, and administrative safeguards necessary to protect the privacy, confidentiality, integrity and security of its software, databases, systems, networks and internet sites and all information stored or contained therein or transmitted thereby
from unauthorized or improper use, access or disclosure and (iii) maintains policies and procedures regarding data security and privacy that are commercially reasonable and, in any event, in compliance with all of its obligations under
applicable Law. There have been no breaches of either the data privacy policies or the system and data security policies of Quintiles or any of its Subsidiaries and neither Quintiles nor any of its Subsidiaries has experienced any data breach that
would violate the Privacy Rights of any Person or any Laws, except, in each case, for those, individually or in the aggregate, which have not had and would not reasonably be expected to have a Quintiles Material Adverse Effect. The use, transfer and
disclosure of, and access to, any and all data and information concerning individuals by Quintiles is in compliance with all applicable Quintiles privacy policies, terms of use, customer agreements and Law, except as, individually or in the
aggregate, has not had and would not reasonably be expected to have a Quintiles Material Adverse Effect.
(c) To the knowledge of
Quintiles, neither Quintiles nor any of its Subsidiaries, Affiliates, directors, shareholders, officers or employees has, directly or indirectly, (i) offered to pay to or solicited any remuneration from, in cash, property or in kind, or made
any financial arrangements with, any past or present customer, physician, health care provider, supplier, contractor or third party in order to induce or directly or indirectly obtain business or payments from such person, including any item or
service for which payment may be made in whole or in part under any federal, state or private health care program, or for purchasing, leasing, ordering or arranging for or recommending, purchasing leasing, or ordering any good, facility, service or
item for which payment may be made in whole or in part under any federal, state or private health care program, in violation of
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any Law, (ii) given or received, or agreed to give or receive, or is aware that there has been made or that there is any agreement to make or receive, any gift or gratuitous payment or
benefit of any kind, nature or description (including in money, property or services, but not including services rendered in the ordinary course for which fair market value payment was made by the recipient) to any past, present or potential
customer, medical director, physician, health care provider, supplier or potential supplier, contractor or any other person in violation of any Law, (iii) established or maintained any unrecorded fund or asset for any illegal purpose or made
any false or artificial entries on any of its books or records for any reason or (iv) made or received or agreed to make or receive, or is aware that there has been made or received or that there has been any intention to make or receive, any
payment to any person with the intention or understanding that any part of such payment would be used for any purpose other than that described in the documents supporting such payment.
Section 4.12
Benefit Plans
.
(a) Quintiles has furnished or made available to IMS Health a true and complete list of, to the extent material, each Quintiles Plan. For
purposes of this Agreement,
Quintiles Plan
means each employee benefit plan (within the meaning of section 3(3) of ERISA, whether or not subject to ERISA), stock purchase, stock option, phantom stock or other
equity-based, severance, employment, consulting, retention, change-in-control, fringe benefit, bonus, incentive, deferred compensation, supplemental retirement, health, life, or disability insurance or dependent care plan, agreement (including any
standard employment agreement or executive employment agreement), program, policy or other arrangement and each other employee benefit plan, agreement, program, policy or other arrangement, in each case, whether or not subject to ERISA (including
any funding mechanism therefor now in effect or required in the future as a result of the transactions contemplated by this Agreement or otherwise), under which any current or former employee, director, independent contractor or consultant of
Quintiles or its Subsidiaries (or any of their dependents) has any present or future right to compensation or benefits or Quintiles or its Subsidiaries sponsors or maintains, is making contributions to or has any present or future liability or
obligation (contingent or otherwise) or with respect to which it is otherwise bound. With respect to each Quintiles Plan and to the extent applicable, Quintiles has provided or made available to IMS Health a current, accurate and complete copy of
(i) the plan documents and amendments thereto, (ii) any related trust agreement or other funding instrument, (iii) the most recent determination letter of the IRS, (iv) summary plan description, including any summary of material
modifications, and (v) the Form 5500 for the most recent plan year, including all schedules, financial statements and actuarial valuation reports.
(b) Neither Quintiles, its Subsidiaries, nor any member of their Controlled Group (defined as any organization which is a member of a
controlled, affiliated or otherwise related group of entities within the meaning of Code Sections 414(b), (c), (m) or (o)) sponsors, maintains, contributes to or is required to contribute to or within the past six (6) years has sponsored,
maintained, contributed to or been required to contribute to: (i) a multiemployer plan (within the meaning of ERISA section 3(37)), (ii) a Pension Plan that is subject to Title IV of ERISA or Section 412 of the Code, or
(iii) a Pension Plan which is a multiple employer plan as defined in Section 413 of the Code, and no liability (contingent or otherwise) has been incurred by any of Quintiles, its Subsidiaries or any member of their Controlled
Group with respect to the foregoing that could become a material liability of the Surviving Corporation.
(c) With respect to the
Quintiles Plans:
(i) each Quintiles Plan has been established and administered in all material respects in accordance with
its terms and in compliance with the applicable provisions of ERISA and the Code and all other applicable legal requirements;
(ii) except as would not reasonably be expected to result in liability material to Quintiles and its Subsidiaries taken as a
whole, no reportable event, as defined in Section 4043 of ERISA, non-exempt prohibited transaction, as described in Section 406 of ERISA or Section 4975 of the Code, or accumulated funding deficiency, as defined in Section 302 of
ERISA and 412 of the Code, has occurred in the past six (6) years with respect to any Quintiles Plan;
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(iii) each Quintiles Plan intended to be qualified under Section 401(a) of
the Code is currently covered by a favorable determination, advisory and/or opinion letter, as applicable, from the IRS that it is so qualified and, to the knowledge of Quintiles, nothing has occurred since the date of such letter that would
reasonably be expected to cause the loss of the qualified status of such Quintiles Plan;
(iv) there is no material Action
(including any investigation, audit or other administrative proceeding) by the Department of Labor, the PBGC, the IRS or any other Governmental Entity or by any plan participant or beneficiary pending, or to the knowledge of Quintiles, threatened,
relating to the Quintiles Plans, any fiduciaries thereof with respect to their duties to the Quintiles Plans or the assets of any of the trusts under any of the Quintiles Plans (other than routine claims for benefits) nor, to the knowledge of
Quintiles, are there facts or circumstances that exist that could reasonably give rise to any such actions;
(v) none of
Quintiles, its Subsidiaries or any member of their Controlled Group has incurred any direct or indirect material liability under ERISA, the Code or other applicable Laws in connection with the termination of, withdrawal from or failure to fund, any
Quintiles Plan that is subject to Title IV of ERISA, and no fact or event exists that would reasonably be expected to give rise to any such liability;
(vi) none of the Quintiles Plans currently provides material post-termination or retiree welfare benefits to any person for any
reason, except as may be required by COBRA, and none of Quintiles, its Subsidiaries or any members of their Controlled Group has any material liability to provide post-termination or retiree welfare benefits to any person, except to the extent
required by COBRA;
(vii) each Quintiles Plan which is a group health plan (as such term is defined in Code
Section 5001(b) or ERISA 733, as applicable, including any plans of affiliates of Quintiles that must be taken into account under Code Sections 4980B and 4980D) is in compliance in all material respects with the applicable requirements of Code
Sections 4980B, 9801, 9802, 9803, 9811, 9812, 9813, and 9815.1, Title I, Part 6 of ERISA, and Section 1862(b)(1)(A)(i) of the Social Security Act and Quintiles does not have any material liability for any excise tax imposed by Code
Section 5000 or 4980D; and
(viii) each Quintiles Plan which is a nonqualified deferred compensation plan
within the meaning of Section 409A of the Code has been operated and administered in compliance in all material respects with Section 409A of the Code and other authoritative and binding guidance thereunder since January 1, 2005 (or,
if later, the date of its adoption), and has been in documentary compliance in all material respects with Section 409A of the Code and other authoritative and binding guidance thereunder since January 1, 2009, and neither Quintiles nor any
of its Subsidiaries has any (A) material liability for withholding Taxes or penalties due under Code Section 409A or 4999 or (B) indemnity obligation for any Taxes imposed under Code Sections 409A.
(d) The execution of this Agreement and the consummation of the Merger will not, either alone or in combination with another event,
(i) entitle any current or former employee, officer, director, independent contractor or consultant of Quintiles or any of its Subsidiaries to severance pay, unemployment compensation or any other similar termination payment or any other
payment, including, pursuant to any retention arrangement entered into prior to or in connection with this Agreement or (ii) accelerate the time of payment or vesting, or increase the amount of or otherwise enhance any benefit due or require
Quintiles or any of its Subsidiaries to segregate any amount from its general assets in respect of any such employee, officer, director, independent contractor or consultant.
(e) Neither Quintiles nor any of its Subsidiaries is a party to any agreement, contract, plan or arrangement that could reasonably be
expected, separately or in the aggregate, in connection with the transactions contemplated by this Agreement (either alone or in combination with any other events), to result in the payment of any excess parachute payments within the
meaning of Section 280G of the Code. No current or former director, officer, employee, independent contractor or consultant of Quintiles or any of its Subsidiaries is entitled to any gross-up, make-whole or any other payment from Quintiles or
any of its Subsidiaries in respect of
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any Tax (including Federal, state, local or foreign income, excise or other Taxes (including Taxes imposed under Section 409A or Section 4999 of the Code)) or any interest or penalty
related thereto.
Section 4.13
Labor Matters
.
(a) Except as would not reasonably be expected to be material to Quintiles and its Subsidiaries taken as a whole, (i) there are no strikes or
lockouts pending or, to the knowledge of Quintiles, threatened with respect to any employees of Quintiles or any of its Subsidiaries (
Quintiles Employees
), and there have been no such activities in the past three (3) years, (ii)
to the knowledge of Quintiles, there is no union organizing effort pending or, to the knowledge of Quintiles, threatened against Quintiles or any of its Subsidiaries, and there have been no such activities in the past three (3) years,
(iii) there is no labor dispute (other than routine individual grievances) or labor arbitration proceeding pending or, to the knowledge of Quintiles, threatened against Quintiles or any of its Subsidiaries, and there have been no such
activities in the past three (3) years, (iv) there is no slowdown or work stoppage in effect or, to the knowledge of Quintiles, threatened with respect to Quintiles Employees, and there have been no such activities in the past three
(3) years, (v) no petition has been filed or proceeding instituted by or on behalf of any labor union, works council or other employee representative organization with any Governmental Entity seeking recognition or certification of a
bargaining representative of any employees of Quintiles or any of its Subsidiaries, and (vi) there is no charge, complaint, or investigation pending or, to the knowledge of Quintiles, threatened by any Governmental Entity against Quintiles or
any of its Subsidiaries concerning any alleged violation of any applicable Law respecting employment or employment practices, including, workplace health and safety, terms and conditions of employment, wages and hours, unfair labor practices, or
employee classification.
(b)
Section 4.13(b)
of the Quintiles Disclosure Letter sets forth all material U.S. and non-U.S.
employee representative bodies, including all labor unions, labor organizations and works councils, and all collective bargaining agreements or other agreements with a labor union, works council or other employee representative organization in
effect that covers any employees of Quintiles or any of its Subsidiaries or to which Quintiles or any of its Subsidiaries is a party or otherwise bound.
(c) Except as would not reasonably be expected to have, individually or in the aggregate, a Quintiles Material Adverse Effect, Quintiles and
its Subsidiaries are in compliance with all applicable Laws respecting employment and employment practices, including, workplace health and safety, terms and conditions of employment and wages and hours, unfair labor practices, and employee
classification.
(d) Except as would not reasonably be expected to result in material liability to Quintiles and its Subsidiaries taken as
a whole, neither Quintiles nor any of its Subsidiaries has any liabilities or is in breach of any obligations under the WARN Act or any similar state or local Law as a result of any action taken by Quintiles (other than at the written direction of
IMS Health).
Section 4.14
Environmental Matters
.
(a) Neither Quintiles nor any of its Subsidiaries has received any claims, notices, demand letters or requests for information (except for
such claims, notices, demand letters or requests for information the subject matter of which has been resolved) from any federal, state, local, foreign or provincial Governmental Entity or any other Person (and to the knowledge of Quintiles, none
are threatened) asserting that Quintiles or any of its Subsidiaries is in material violation of, or has material liability under, any Environmental Law, and, except as, individually or in the aggregate, has not had and would not reasonably be
expected to have a Quintiles Material Adverse Effect, (i) Quintiles and each of its Subsidiaries are and have been in compliance with all, and have not violated any, applicable Environmental Laws; (ii) Quintiles and its Subsidiaries have obtained,
maintained and are and have been in compliance with all Permits of all Governmental Entities and any other Person that are required under any Environmental Law; (iii) there has been no release of any Hazardous Substance by Quintiles or any of its
Subsidiaries or any other Person in any manner that has given or would reasonably be expected to
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give rise to any remedial or investigative obligation, corrective action requirement or liability of Quintiles or any of its Subsidiaries under applicable Environmental Laws; (iv) no
Hazardous Substance has been disposed of, arranged to be disposed of, released or transported in violation of any applicable Environmental Law, or in a manner that has given rise to, or that would reasonably be expected to give rise to, any
liability under any Environmental Law, in each case, on, at, under or from any current or former properties or facilities owned or operated by Quintiles or any of its Subsidiaries and Hazardous Substances are not otherwise present at or about any
such properties or facilities in amount or condition that has resulted in or would reasonably be expected to result in liability to Quintiles or any of its Subsidiaries under any Environmental Law; and (v) neither Quintiles, its Subsidiaries
nor any of their respective properties or facilities are subject to, or, to the knowledge of Quintiles, are threatened to become subject to, any liabilities relating to any suit, settlement, court order, administrative order, regulatory requirement,
judgment or claim asserted or arising under any Environmental Law or any agreement relating to environmental liabilities.
Section 4.15
Taxes
.
(a) Except as would not reasonably be expected to have, individually or in the aggregate, a Quintiles Material Adverse Effect:
(i) all Tax Returns required to be filed by or on behalf of Quintiles and each of its Subsidiaries have been prepared and
timely filed with the appropriate Governmental Entity (taking into account any valid extensions of time within which to file) and all such filed Tax Returns are complete and accurate,
(ii) all Taxes required to be paid by or on behalf of Quintiles and each of its Subsidiaries have been timely paid with the
appropriate Governmental Entity, and all Taxes that have accrued but are not yet payable have been reserved for in accordance with GAAP in Quintiles financial statements included in Quintiles SEC Documents or have been incurred in the
ordinary course of business since the date of the most recent period covered by the financial statements included in Quintiles SEC Documents,
(iii) all deficiencies asserted or assessed by a Governmental Entity against Quintiles or any of its Subsidiaries have been
paid in full or are adequately reserved in accordance with GAAP,
(iv) there are no pending or, to the knowledge of
Quintiles, threatened Actions relating to Taxes and there are no currently effective waivers (or requests for waivers) of the time to assess any Taxes,
(v) there are no Liens for Taxes on any of the assets of Quintiles or any of its Subsidiaries other than Permitted Liens,
(vi) neither Quintiles nor any of its Subsidiaries has any liability for Taxes of any other person (other than Quintiles and
its Subsidiaries) pursuant to Treasury Regulation Section 1.1502-6 (or any similar provision of state, local or foreign Law), as a transferee or successor, or by Contract, and
(vii) Quintiles and its Subsidiaries have complied with all applicable Laws relating to the payment, collection and withholding
of Taxes and paid over to the appropriate Governmental Entity all amounts required to be so withheld or collected and paid under all applicable Laws.
(b) Neither Quintiles nor any of its Subsidiaries has been a controlled corporation or a distributing corporation in
any distribution occurring during the three-year period ending on the date hereof (or otherwise as part of a plan (or series of related transactions) within the meaning of Section 355(e) of the Code of which the Merger is also a
part) that was purported or intended to be governed by Section 355 of the Code.
(c) During the five-year period ending on the date
hereof, neither Quintiles nor any of its Subsidiaries has been included in a consolidated, unitary or combined Tax Return under U.S. federal, state, local or foreign Law with respect to Taxes for any taxable
period (other than a group of which Quintiles or any of its Subsidiaries was the common parent).
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(d) Neither Quintiles nor any of its Subsidiaries is a party to or is bound by any Tax sharing,
allocation or indemnification agreement (other than agreements entered into in the ordinary course of business the primary purpose of which is not the sharing of Taxes, such as leases, vendor and customer agreements, credit agreements and purchase
agreements).
(e) Neither Quintiles nor any of its Subsidiaries has participated in any listed transaction within the meaning
of Treasury Regulation Section 1.6011-4(b)(2).
(f) Neither Quintiles nor any of its Subsidiaries has taken or agreed to take (or
failed to take or agree to take) any action or knows of any facts or circumstances that would reasonably be expected to prevent the Merger from qualifying as a reorganization within the meaning of Section 368(a) of the Code.
Section 4.16
Contracts
.
(a)
Section 4.16
of the Quintiles Disclosure Letter lists each Contract, other than any Contract that is listed as an exhibit to
Quintiles annual report on Form 10-K for the year ended December 31, 2015 or Quintiles quarterly report on Form 10-Q for the quarter ended March 31, 2016, in each case without giving effect to any amendment thereto filed on or
after the date hereof (such contracts, the
Quintiles Public Contracts
), of the following types to which Quintiles or any of its Subsidiaries is a party or by which any of their respective properties or assets is bound:
(i) any partnership, joint venture, strategic alliance or collaboration Contract which is material to Quintiles and its
Subsidiaries, taken as a whole;
(ii) any non-competition agreement, exclusivity, non-solicitation or any other agreement
or obligation which purports to limit or restrict in any material respect the manner in which, or the localities in which, all or any material portion of the businesses of Quintiles and its Subsidiaries, taken as a whole, is or would be conducted
(other than customer Contracts entered into by Quintiles or its Subsidiaries in the ordinary course of business);
(iii)
any Contract relating to Indebtedness and having an outstanding principal amount in excess of $10,000,000, other than Contracts solely among Quintiles and/or wholly-owned Subsidiaries of Quintiles;
(iv) each Contract relating to the acquisition or disposition of assets or stock that contains representations, covenants,
indemnities or other obligations (including earn-out or other contingent payment obligations) that would reasonably be expected to result in the receipt or making of future payments in excess of $10,000,000 in the twelve (12) month
period following the date hereof;
(v) each Contract between Quintiles, on the one hand, and any officer, director or
affiliate (other than a wholly-owned Subsidiary of Quintiles) of Quintiles or any of their respective associates or immediate family members (as such terms are defined in Rule 12b-2 and Rule 16a-1 of the Exchange Act), on the
other hand, including any Contract pursuant to which Quintiles has an obligation to indemnify such officer, director, affiliate or family member;
(vi) any shareholders, investor rights, registration rights or similar agreement or arrangement of Quintiles or any of its
Subsidiaries;
(vii) any Contract that relates to any swap, forward, futures, or other similar derivative transaction with
a notional value in excess of $10,000,000;
(viii) any collective bargaining agreement or other Contract with any labor
union, works council or other employee representative organization;
(ix) any lease or amendment to the terms of any
existing lease of real property that would require payments over the remaining term of such lease in excess of $25,000,000; and
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(x) any Contract that would be required to be filed by Quintiles as a
material contract pursuant to Item 601(b)(10) of Regulation S-K under the Securities Act or disclosed by Quintiles on a Current Report on Form 8-K.
Each Quintiles Public Contract, together with any contract of the type described in clauses (i) through (x), is referred to herein as a
Quintiles Material Contract
.
(b) (i) Each Quintiles Material Contract is valid and binding on Quintiles and any of its
Subsidiaries to the extent such Subsidiary is a party thereto, as applicable, and to the knowledge of Quintiles, each other party thereto, and is in full force and effect and enforceable in accordance with its terms, except where the failure to be
valid, binding, enforceable and in full force and effect, individually or in the aggregate, has not had and would not reasonably be expected to have a Quintiles Material Adverse Effect; (ii) Quintiles and each of its Subsidiaries, and, to the
knowledge of Quintiles, each other party thereto, has performed all obligations required to be performed by it under each Quintiles Material Contract, except where any noncompliance, individually or in the aggregate, has not had and would not
reasonably be expected to have a Quintiles Material Adverse Effect; and (iii) there is no default under any Quintiles Material Contract by Quintiles or any of its Subsidiaries or, to the knowledge of Quintiles, any other party thereto, and no event
or condition has occurred that constitutes, or, after notice or lapse of time or both, would constitute, a default on the part of Quintiles or any of its Subsidiaries or, to the knowledge of Quintiles, any other party thereto under any such
Quintiles Material Contract, nor has Quintiles or any of its Subsidiaries received any notice of any such default, event or condition, except where any such default, event or condition, individually or in the aggregate, has not had and would not
reasonably be expected to have a Quintiles Material Adverse Effect. Quintiles has made available to IMS Health true and complete copies of all Quintiles Material Contracts, including all amendments thereto.
(c) The reasonably expected future payments of Quintiles and its Subsidiaries pursuant to all Contracts for the acquisition or disposition of
assets or stock that contain representations, covenants, indemnities or other obligations (including earn-out or other contingent payment obligations), to which Quintiles or any of its Subsidiaries is a party, does not exceed $30,000,000
in the aggregate.
Section 4.17
Insurance
. Except as, individually or in the aggregate, has not had and would not reasonably
be expected to have a Quintiles Material Adverse Effect, with respect to each insurance policy covering Quintiles and its Subsidiaries, (a) such policy is in full force and effect and all premiums due thereon have been paid, (b) neither
Quintiles nor any of its Subsidiaries is in breach or default, and has not taken any action or failed to take any action which (with or without notice or lapse of time, or both) would constitute such a breach or default, or would permit termination
or modification of, any such policy, (c) to the knowledge of Quintiles, no insurer issuing any such policy has been declared insolvent or placed in receivership, conservatorship or liquidation, (d) no notice of cancellation or termination
has been received with respect to any such policy, nor will any such cancellation or termination result from the consummation of the transactions contemplated hereby and (e) the insurance policies are sufficient for compliance by Quintiles with
all applicable Laws or obligations with respect to Quintiles Material Contracts to maintain insurance to which Quintiles is a party.
Section 4.18
Properties
. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a
Quintiles Material Adverse Effect, (a) Quintiles and each of its Subsidiaries has good and marketable fee title (or the equivalent in any applicable foreign jurisdiction) to each and all of its owned real property, and good and valid leasehold
title to all of its leased property pursuant to leases with third parties which are enforceable in accordance with their terms, in each case subject only to Permitted Liens, (b) all such real property (i) complies with all applicable
zoning and land use ordinances, laws and regulations, or is a valid nonconforming use thereunder, (ii) has sufficient access to a public road and (iii) is improved with all necessary and sufficient buildings, structures and improvements
sufficient for the continuation of its business as currently conducted, in accordance with all applicable Permits and applicable Laws with respect to Quintiles and its Subsidiaries, (c) there are no existing (or to the knowledge of Quintiles
threatened in writing) condemnation proceedings with respect to any such real property and (d) with respect to all such leased real property, Quintiles
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and each of its Subsidiaries is in compliance with all material terms and conditions of each lease therefor, and neither Quintiles nor any of its Subsidiaries has received any notice of default
thereunder which is outstanding and remains uncured beyond any applicable period of cure.
Section 4.19
Intellectual Property
.
Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Quintiles Material Adverse Effect, either Quintiles or a Subsidiary of Quintiles owns, or is licensed or otherwise possesses adequate rights to
use (in the manner and to the extent it has used the same), all trademarks or servicemarks (whether registered or unregistered), trade names, domain names, copyrights (whether registered or unregistered), patents, trade secrets or other intellectual
property of any kind used in their respective businesses as currently conducted (collectively, the
Quintiles Intellectual Property
). No single item of Quintiles Intellectual Property owned by Quintiles or any of its Subsidiaries
is material to the operation of their businesses. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Quintiles Material Adverse Effect, Quintiles or one of its Subsidiaries is listed as the owner
of record for each item of registered Quintiles Intellectual Property, and pending applications therefor, that Quintiles and its Subsidiaries owns or purports to own (collectively, the
Quintiles Registered Intellectual Property
)
with the relevant patent, trademark, copyright, domain name, or other authority in the United States or foreign jurisdiction, as the case may be. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a
Quintiles Material Adverse Effect, all of the Quintiles Registered Intellectual Property is valid, enforceable and subsisting and there are no challenges to the ownership, use, validity or enforceability of the Quintiles Registered Intellectual
Property. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Quintiles Material Adverse Effect, (a) there are no pending claims or claims threatened in writing by any Person alleging
infringement, misappropriation or dilution by Quintiles or any of its Subsidiaries of the intellectual property rights of any Person; (b) the conduct of the businesses of Quintiles and its Subsidiaries has not infringed, misappropriated or
diluted, and does not infringe, misappropriate or dilute, any intellectual property rights of any Person; (c) neither Quintiles nor any of its Subsidiaries has made any claim of infringement, misappropriation or other violation by others of its
rights to or in connection with Quintiles Intellectual Property; (d) to the knowledge of Quintiles, no Person is infringing, misappropriating or diluting any Quintiles Intellectual Property; (e) Quintiles and its Subsidiaries have taken
reasonable steps to protect the confidentiality of their trade secrets and the security of their computer systems and networks; and (f) the consummation of the transactions contemplated by this Agreement will not result in the loss of, or give
rise to any right of any third party to terminate any of Quintiles or any Subsidiaries rights or obligations under, any agreement under which Quintiles or any of its Subsidiaries grants to any Person, or any Person grants to Quintiles or
any of its Subsidiaries, a license or right under or with respect to any Quintiles Intellectual Property.
Section 4.20
State
Takeover Statutes
. As of the date hereof and at all times on or prior to the Effective Time, the Quintiles Board has taken all actions so that the restrictions applicable to business combinations contained in The North Carolina Shareholder
Protection Act (NCBCA Art. 9) and The North Carolina Control Share Acquisition Act (NCBCA Art. 9A) are, and will be, inapplicable to the execution, delivery and performance of this Agreement and the timely consummation of the Merger and the other
transactions contemplated hereby. No other Takeover Laws or any similar anti-takeover provision in the Quintiles Charter or Quintiles Bylaws is, or at the Effective Time will be, applicable to this Agreement, the Merger or any of the other
transactions contemplated hereby.
Section 4.21
Affiliate Transactions
. There are no transactions or Contracts between
Quintiles or any of its Subsidiaries, on the one hand, and any of Quintiles Affiliates (other than wholly-owned Subsidiaries of Quintiles), on the other hand, that would be required to be disclosed by Quintiles under Item 404 of
Regulation S-K under the Securities Act that have not been disclosed in the Quintiles SEC Documents.
Section 4.22
Anti-Bribery
Laws
. Quintiles and its Affiliates, directors, officers and employees have complied in all material respects with the Anti-Bribery Laws. Quintiles and its Affiliates have developed and
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implemented an Anti-Bribery Law compliance program which includes corporate policies and procedures designed to ensure compliance in all material respects with the Anti-Bribery Laws. Except for
facilitating payments (as such term is defined in the FCPA and other applicable Laws), to the knowledge of Quintiles, neither Quintiles nor any of its Affiliates, directors, officers, employees, agents or other representatives acting on
its behalf have directly or indirectly (a) used any corporate funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity, (b) offered, promised, paid or delivered any fee, commission or
other sum of money or item of value, however characterized, to any finder, agent or other party acting on behalf of a governmental or political employee or official or governmental or political entity, political agency, department, enterprise or
instrumentality, in the United States or any other country, that was illegal under any applicable Law, (c) made any payment to any customer or supplier, or to any officer, director, joint venture partner, employee or agent of any such customer
or supplier, for the unlawful sharing of fees or unlawful rebating of charges, (d) engaged in any other unlawful reciprocal practice, or made any other unlawful payment or given any other unlawful consideration to any such customer or supplier
or any such officer, director, joint venture partner, employee or agent of the customer or supplier, or (e) taken any action or made any omission in violation of any applicable Law governing imports into or exports from the United States or any
foreign country, or relating to economic sanctions or embargoes, corrupt practices, money laundering or compliance with unsanctioned foreign boycotts.
Section 4.23
Brokers
. No broker, investment banker, financial advisor or other Person, other than Barclays Capital Inc. (the
Quintiles Financial Advisor
), the fees and expenses of which will be paid by Quintiles, is entitled to any brokers, finders, financial advisors or other similar fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or on behalf of Quintiles or any of its Affiliates.
Section 4.24
Opinion of Financial Advisor
. The Quintiles Board has received an oral opinion (to be confirmed in writing) of the
Quintiles Financial Advisor, dated on or about the date of this Agreement, to the effect that, subject to the assumptions, limitations, qualifications and other matters set forth in the written opinion of the Quintiles Financial Advisor, as of such
date, from a financial point of view, the Exchange Ratio to be paid by Quintiles in the Merger is fair to Quintiles. A signed true and complete copy of such opinion has been or will promptly be provided to IMS Health for informational purposes
following receipt thereof by the Quintiles Board.
ARTICLE V
COVENANTS
Section 5.1
Conduct of Business
.
(a)
Conduct of Business by Quintiles
. During the period from the date of this Agreement to the Effective Time, except as consented to
in writing in advance by IMS Health or as otherwise specifically required by this Agreement, Quintiles shall, and shall cause each of its Subsidiaries to, carry on its business in the ordinary course consistent with past practice and use reasonable
best efforts to preserve intact its business organization, preserve its assets, rights and properties in good repair and condition, keep available the services of its current directors, officers and other key employees and preserve its goodwill and
its relationships with customers, suppliers, licensors, licensees, distributors and others having business dealings with it. In addition to and without limiting the generality of the foregoing, during the period from the date of this Agreement to
the Effective Time, except as set forth in
Section 5.1(a)
of the Quintiles Disclosure Letter or as specifically required by this Agreement, Quintiles shall not, and shall cause its Subsidiaries not to, take any of the following actions
without IMS Healths prior written consent:
(i) (A) declare, set aside or pay any dividends on, or make any other
distributions (whether in cash, stock or property) in respect of, any of its capital stock or other equity interests, except for dividends by a wholly owned Subsidiary of Quintiles to its parent, (B) purchase, redeem or otherwise
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acquire shares of capital stock or other equity interests of Quintiles or its Subsidiaries or any options, warrants, or rights to acquire any such shares or other equity interests (other than in
connection with the vesting or exercise of awards outstanding under the Quintiles Equity Plans on the Measurement Date in accordance with their terms as in effect on such date) or (C) split, combine, reclassify or otherwise amend the terms of
any of its capital stock or other equity interests or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock or other equity interests;
(ii) issue, deliver, sell, grant, pledge or otherwise encumber or subject to any Lien any shares of its capital stock or other
equity interests or any securities convertible into, or exchangeable for or exercisable for any such shares or other equity interests, or any rights, warrants or options to acquire, any such shares or other equity interests, or any stock
appreciation rights, phantom stock rights, performance units, rights to receive shares of capital stock of Quintiles on a deferred basis or other rights linked to the value of shares of Quintiles Common Stock, including pursuant to
Contracts as in effect on the date hereof (other than (A) the grant of Quintiles Options, Quintiles RSUs, Quintiles PSUs and Quintiles SARs in the ordinary course of business;
provided
, that the aggregate number of shares of Quintiles
Common Stock subject to issuance or underlying the same shall not exceed 1,440,000 shares of Quintiles Common Stock, and (B) the issuance of shares of Quintiles Common Stock upon the exercise of Quintiles Options or settlement of Quintiles RSUs
or Quintiles PSUs (x) outstanding on the Measurement Date in accordance with their terms as in effect on such date or (y) issued pursuant to clause (A) above);
(iii) amend or otherwise change, or authorize or propose to amend or otherwise change, its articles of incorporation or bylaws
(or similar organizational documents), the Quintiles Shareholders Agreement or the Quintiles Registration Rights Agreement, except as specifically required by this Agreement;
(iv) directly or indirectly acquire or agree to acquire (A) by merging or consolidating with, purchasing an equity
interest in or a portion of the assets of, making an investment in or loan or capital contribution to or in any other manner, any corporation, partnership, association or other business organization or division thereof or (B) any assets, real
property, or personal property that are otherwise material to Quintiles and its Subsidiaries, except (1) in the ordinary course of business consistent with past practice, (2) transactions involving only direct or indirect wholly-owned
Subsidiaries of Quintiles, or (3) in one or more transactions with respect to which the aggregate consideration for all such transactions during the period from the date of this Agreement to the Closing Date does not exceed $150,000,000, in
each case subject to the restrictions set forth in
Section 5.6
;
(v) directly or indirectly sell, lease, license,
transfer, exchange, dispose of, sell and leaseback, abandon, mortgage or otherwise encumber or subject to any Lien (other than a Permitted Lien) or otherwise dispose in whole or in part of any of its material properties, assets or rights or any
interest therein, other than (1) in the ordinary course of business consistent with past practice, (2) assets and properties associated with discontinued operations or (3) in addition to clauses (1) and (2), in one or more
transactions with respect to which the aggregate consideration for all such transactions during the period from the date of this Agreement to the Closing Date does not exceed $100,000,000;
(vi) adopt or enter into a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other
reorganization, other than to complete internal restructurings or dissolutions of wholly-owned entities;
(vii) incur,
create, assume or otherwise become liable for, or repay or prepay, any Indebtedness, or amend, modify or refinance any Indebtedness (except for the repayment of any Indebtedness existing on the date of this Agreement that comes due following the
date hereof, in accordance with its terms) except (A) for Indebtedness incurred in the ordinary course of business and consistent with past practice under Quintiles current borrowing agreements and facilities or any refinancing,
substitution or replacement thereof, (B) for any inter-company Indebtedness solely involving Quintiles and/or direct or indirect wholly-owned Subsidiaries, (C) incremental Indebtedness for borrowed money not to
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exceed $100,000,000 in the aggregate outstanding at any time incurred by Quintiles or any of its Subsidiaries other than in accordance with clauses (A) and (B), or (D) guarantees by
Quintiles of Indebtedness for borrowed money of its Subsidiaries, which Indebtedness is incurred in compliance with this
Section 5.1(a)(vii)
;
(viii) except in the ordinary course of business consistent with past practice, or as disclosed in Quintiles capital
expenditures plan previously provided to IMS Health, make any new capital expenditure or expenditures, or commit to do so;
(ix) other than as permitted by
Section 5.1(a)(xi)
, (A) pay, discharge, compromise, settle or satisfy any
material claims, liabilities or obligations (whether absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business consistent with past practice or as
required by their terms as in effect on the date of this Agreement of claims, liabilities or obligations reflected or reserved against in the most recent audited financial statements (or the notes thereto) of Quintiles included in the Quintiles SEC
Documents filed prior to the date hereof (for amounts not in excess of such reserves) or incurred since the date of such financial statements in the ordinary course of business consistent with past practice, or (B) cancel any material
Indebtedness owed to Quintiles or any of its Subsidiaries;
(x) other than in the ordinary course of business consistent
with past practice or in connection with any transaction to the extent specifically permitted by any other subclause of this
Section 5.1(a)
, (A) materially modify, materially amend, terminate, cancel or extend any Quintiles Material
Contract or waive, release or assign any material rights or claims thereunder, or (B) enter into any Contract that if in effect on the date hereof would be a Quintiles Material Contract;
(xi) commence any Action (other than (A) in the ordinary course of business or (B) an Action as a result of an Action
commenced against Quintiles or any of its Subsidiaries), or compromise, settle or agree to settle any Action (including any Action relating to this Agreement or the transactions contemplated hereby) other than compromises, settlements or agreements
in the ordinary course of business consistent with past practice that involve only the payment of money damages not in excess of reserves reflected on Quintiles financial statements included in the Quintiles SEC Documents in an amount of
$40,000,000 in the aggregate (in each case, net of insurance proceeds), in any case without the imposition of any equitable relief on, or the admission of wrongdoing by, Quintiles;
(xii) change its material financial accounting methods, principles or practices, except insofar as may have been required by a
change in GAAP or applicable Law, or revalue any of its material assets;
(xiii) settle or compromise any material
liability for Taxes; file any amended Tax Return or claim for Tax refund; make, revoke or modify any Tax election; file any Tax Return other than on a basis consistent with past practice; enter into any Tax allocation, sharing or indemnity agreement
(other than agreements entered into in the ordinary course of business the primary purpose of which is not the sharing of Taxes, such as leases, vendor and customer agreements, credit agreements and purchase agreements); or change any method of
accounting for Tax purposes;
(xiv) change its fiscal year;
(xv) except as required to comply with any applicable Law or except as required to comply with any Quintiles Plan, as in effect
as of the date hereof, or the terms of this Agreement, (A) with respect to any current or former director, employee, independent contractor or consultant of Quintiles, grant any such individual any increase in compensation, bonus or other benefits,
or grant any type of compensation or benefits to any such individual not previously receiving or entitled to receive such type of compensation or benefit, or pay any bonus of any kind or amount to any such individual, other than increases in
compensation or benefits or the payment of bonuses in the ordinary course of business consistent with past practice, (B) grant or pay to any current or former director, employee, independent contractor or consultant of Quintiles any severance,
change in control, retention, termination or similar compensation or benefit, or modifications thereto or increases therein, other than severance payments
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in the ordinary course of business consistent with past practice, (C) pay any benefit or grant or amend any award (including in respect of stock options, stock appreciation rights,
performance units, restricted stock or other stock-based or stock-related awards or the removal or modification of any restrictions in any Quintiles Plan or awards made thereunder) to any current or former director, employee, independent contractor
or consultant of Quintiles, except as required to comply with any applicable Law or any Quintiles Plan in effect as of the date hereof, (D) adopt or enter into any collective bargaining agreement or other labor union contract, (E) take any
action to amend a Quintiles Plan or Contract in any material respect or accelerate the vesting, funding or payment of any compensation or benefit under any Quintiles Plan or other Contract or (F) adopt any new employee benefit or compensation
plan or arrangement that would otherwise be considered a Quintiles Plan if in effect of the date of this Agreement, other than as required by applicable Law;
(xvi) enter into any new line of business outside of its existing business;
(xvii) enter into any Contracts with any officer, director or affiliate (other than a wholly-owned Subsidiary of Quintiles) of
Quintiles or any of their respective associates or immediate family members (as such terms are defined in Rule 12b-2 and Rule 16a-1 of the Exchange Act), including any Contract pursuant to which Quintiles has an obligation to
indemnify such officer, director, affiliate or family member; or
(xviii) authorize any of, or commit, resolve or agree to
take any of, the foregoing actions.
(b)
Conduct of Business by IMS Health
. During the period from the date of this Agreement to
the Effective Time, except as consented to in writing in advance by Quintiles or as otherwise specifically required by this Agreement, IMS Health shall, and shall cause each of its Subsidiaries to, carry on its business in the ordinary course
consistent with past practice and use reasonable best efforts to preserve intact its business organization, preserve its assets, rights and properties in good repair and condition, keep available the services of its current directors, officers and
other key employees and preserve its goodwill and its relationships with customers, suppliers, licensors, licensees, distributors and others having business dealings with it. In addition to and without limiting the generality of the foregoing,
during the period from the date of this Agreement to the Effective Time, except as set forth in
Section 5.1(b)
of the IMS Health Disclosure Letter or as specifically required by this Agreement, IMS Health shall not, and shall cause its
Subsidiaries not to, take any of the following actions without Quintiles prior written consent:
(i) (A)
declare, set aside or pay any dividends on, or make any other distributions (whether in cash, stock or property) in respect of, any of its capital stock or other equity interests, except for dividends by a wholly owned Subsidiary of IMS Health to
its parent, (B) purchase, redeem or otherwise acquire shares of capital stock or other equity interests of IMS Health or its Subsidiaries or any options, warrants, or rights to acquire any such shares or other equity interests (other than in
connection with the vesting or exercise of awards outstanding under the IMS Health Equity Plans on the Measurement Date in accordance with their terms as in effect on such date) or (C) split, combine, reclassify or otherwise amend the terms of
any of its capital stock or other equity interests or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock or other equity interests;
(ii) issue, deliver, sell, grant, pledge or otherwise encumber or subject to any Lien any shares of its capital stock or other
equity interests or any securities convertible into, or exchangeable for or exercisable for any such shares or other equity interests, or any rights, warrants or options to acquire, any such shares or other equity interests, or any stock
appreciation rights, phantom stock rights, performance units, rights to receive shares of capital stock of IMS Health on a deferred basis or other rights linked to the value of shares of IMS Health Common Stock, including pursuant to
Contracts as in effect on the date hereof (other than (A) the grant of IMS Health Options, IMS Health RSUs, IMS Health SARs and IMS Health Restricted Stock in the ordinary course of business;
provided
, that the aggregate number of shares
of IMS Health Common Stock subject to issuance or underlying the same
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shall not exceed 3,960,000 shares of IMS Health Common Stock, and (B) the issuance of shares of IMS Health Common Stock upon the exercise of IMS Health Options or settlement of IMS Health
RSUs or IMS Health SARs (x) outstanding on the Measurement Date in accordance with their terms as in effect on such date or (y) issued pursuant to clause (A) above);
(iii) amend or otherwise change, or authorize or propose to amend or otherwise change, its certificate of incorporation or
bylaws (or similar organizational documents), the IMS Health Shareholders Agreement or the IMS Health Registration and Preemptive Rights Agreement, except as specifically required by this Agreement;
(iv) directly or indirectly acquire or agree to acquire (A) by merging or consolidating with, purchasing an equity
interest in or a portion of the assets of, making an investment in or loan or capital contribution to or in any other manner, any corporation, partnership, association or other business organization or division thereof or (B) any assets, real
property, or personal property that are otherwise material to IMS Health and its Subsidiaries, except (1) in the ordinary course of business consistent with past practice, (2) transactions involving only direct or indirect wholly-owned
Subsidiaries of IMS Health, or (3) in one or more transactions with respect to which the aggregate consideration for all such transactions during the period from the date of this Agreement to the Closing Date does not exceed $150,000,000, in
each case subject to the restrictions set forth in
Section 5.6
;
(v) directly or indirectly sell, lease, license,
transfer, exchange, dispose of, sell and leaseback, abandon, mortgage or otherwise encumber or subject to any Lien (other than a Permitted Lien) or otherwise dispose in whole or in part of any of its material properties, assets or rights or any
interest therein, other than (1) in the ordinary course of business consistent with past practice, (2) assets and properties associated with discontinued operations or (3) in addition to clauses (1) and (2), in one or more transactions
with respect to which the aggregate consideration for all such transactions during the period from the date of this Agreement to the Closing Date does not exceed $100,000,000;
(vi) adopt or enter into a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other
reorganization, other than to complete internal restructurings or dissolutions of wholly-owned entities;
(vii) incur,
create, assume or otherwise become liable for, or repay or prepay, any Indebtedness, or amend, modify or refinance any Indebtedness (except for the repayment of any Indebtedness existing on the date of this Agreement that comes due following the
date hereof, in accordance with its terms) except (A) for Indebtedness incurred in the ordinary course of business and consistent with past practice under IMS Healths current borrowing agreements and facilities or any refinancing,
substitution or replacement thereof, (B) for any inter-company Indebtedness solely involving IMS Health and/or direct or indirect wholly-owned Subsidiaries, (C) incremental Indebtedness for borrowed money not to exceed $100,000,000 in the
aggregate outstanding at any time incurred by IMS Health or any of its Subsidiaries other than in accordance with clauses (A) and (B), or (D) guarantees by IMS Health of Indebtedness for borrowed money of its Subsidiaries, which
Indebtedness is incurred in compliance with this
Section 5.1(b)(vii)
;
(viii) except in the ordinary course of
business consistent with past practice, or as disclosed in IMS Healths capital expenditures plan previously provided to Quintiles, make any new capital expenditure or expenditures, or commit to do so;
(ix) other than as permitted by
Section 5.1(b)(xi)
, (A) pay, discharge, compromise, settle or satisfy any
material claims, liabilities or obligations (whether absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business consistent with past practice or as
required by their terms as in effect on the date of this Agreement of claims, liabilities or obligations reflected or reserved against in the most recent audited financial statements (or the notes thereto) of IMS Health included in the IMS Health
SEC Documents filed prior to the date hereof (for amounts not in excess of such reserves) or incurred since the date of
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such financial statements in the ordinary course of business consistent with past practice, or (B) cancel any material Indebtedness owed to IMS Health or any of its Subsidiaries;
(x) other than in the ordinary course of business consistent with past practice or in connection with any transaction to the
extent specifically permitted by any other subclause of this Section 5.1(b), (A) materially modify, materially amend, terminate, cancel or extend any IMS Health Material Contract or waive, release or assign any material rights or claims
thereunder or (B) enter into any Contract that if in effect on the date hereof would be an IMS Health Material Contract;
(xi) commence any Action (other than (A) in the ordinary course of business or (B) an Action as a result of an Action
commenced against IMS Health or any of its Subsidiaries), or compromise, settle or agree to settle any Action (including any Action relating to this Agreement or the transactions contemplated hereby) other than compromises, settlements or agreements
in the ordinary course of business consistent with past practice that involve only the payment of money damages not in excess of reserves reflected on IMS Healths financial statements included in the IMS Health SEC Documents in an amount of
$40,000,000 in the aggregate (in each case, net of insurance proceeds), in any case without the imposition of any equitable relief on, or the admission of wrongdoing by, IMS Health;
(xii) change its material financial accounting methods, principles or practices, except insofar as may have been required by a
change in GAAP or applicable Law, or revalue any of its material assets;
(xiii) settle or compromise any material
liability for Taxes; file any amended Tax Return or claim for Tax refund; make, revoke or modify any Tax election; file any Tax Return other than on a basis consistent with past practice; enter into any Tax allocation, sharing, or indemnity
agreement (other than agreements entered into in the ordinary course of business the primary purpose of which is not the sharing of Taxes, such as leases, vendor and customer agreements, credit agreements and purchase agreements); or change any
method of accounting for Tax purposes;
(xiv) change its fiscal year;
(xv) except as required to comply with any applicable Law or except as required to comply with any IMS Health Plan, as in
effect as of the date hereof, or the terms of this Agreement, (A) with respect to any current or former director, employee, independent contractor or consultant of IMS Health, grant any such individual any increase in compensation, bonus or
other benefits, or grant any type of compensation or benefits to any such individual not previously receiving or entitled to receive such type of compensation or benefit, or pay any bonus of any kind or amount to any such individual, other than
increases in compensation or benefits or the payment of bonuses in the ordinary course of business consistent with past practice, (B) grant or pay to any current or former director, employee, independent contractor or consultant of IMS Health
any severance, change in control, retention, termination or similar compensation or benefit, or modifications thereto or increases therein, other than severance payments in the ordinary course of business consistent with past practice, (C) pay
any benefit or grant or amend any award (including in respect of stock options, stock appreciation rights, performance units, restricted stock or other stock-based or stock-related awards or the removal or modification of any restrictions in any IMS
Health Plan or awards made thereunder) to any current or former director, employee, independent contractor or consultant of IMS Health, except as required to comply with any applicable Law or any IMS Health Plan in effect as of the date hereof,
(D) adopt or enter into any collective bargaining agreement or other labor union contract, (E) take any action to amend an IMS Health Plan or Contract in any material respect or accelerate the vesting, funding or payment of any
compensation or benefit under any IMS Health Plan or other Contract or (F) adopt any new employee benefit or compensation plan or arrangement that would otherwise be considered an IMS Health Plan if in effect of the date of this Agreement,
other than as required by applicable Law;
(xvi) enter into any new line of business outside of its existing business;
(xvii) enter into any Contracts with any officer, director or affiliate (other than a wholly-owned Subsidiary of IMS Health) of
IMS Health or any of their respective associates or immediate family
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members (as such terms are defined in Rule 12b-2 and Rule 16a-1 of the Exchange Act), including any Contract pursuant to which IMS Health has an obligation to indemnify such officer, director,
affiliate or family member; or
(xviii) authorize any of, or commit, resolve or agree to take any of, the foregoing
actions.
Section 5.2
Covenants of Quintiles Regarding No Solicitation; Recommendation of the Merger
(a) Quintiles shall not, and shall not permit or authorize any of its Subsidiaries or any director, officer, employee, investment banker,
financial advisor, attorney, accountant or other advisor, agent or representative (collectively,
Representatives
) of Quintiles or any of its Subsidiaries, directly or indirectly, to (i) solicit, initiate, endorse, knowingly
encourage (including by way of furnishing information) or take any action to knowingly facilitate any inquiry, proposal or offer with respect to, or the making or completion of, any Acquisition Proposal, or any inquiry, proposal or offer that is
reasonably likely to lead to any Acquisition Proposal, (ii) other than to inform any Person of the existence of the provisions contained in this
Section 5.2
, enter into, continue or otherwise participate in any discussions or negotiations
regarding, or furnish to any Person any information or data with respect to, or otherwise cooperate in any way with, any Acquisition Proposal or (iii) resolve, agree or propose to do any of the foregoing. Quintiles shall, and shall cause each of its
Subsidiaries and the Representatives of Quintiles and its Subsidiaries to, (A) immediately cease and cause to be terminated all existing discussions and negotiations with any Person conducted heretofore with respect to any Acquisition Proposal or
potential Acquisition Proposal and immediately terminate all physical and electronic data room access previously granted to any such Person, (B) request the prompt return or destruction of all confidential information previously furnished with
respect to any Acquisition Proposal or potential Acquisition Proposal, and (C) not terminate, waive, amend, release or modify any provision of any confidentiality or standstill agreement to which it or any of its Affiliates or Representatives is a
party with respect to any Acquisition Proposal or potential Acquisition Proposal, and shall enforce the provisions of any such agreement, which shall include seeking any injunctive relief available to enforce such agreement. Notwithstanding the
foregoing, if at any time following the date of this Agreement and prior to obtaining the Quintiles Stockholder Approval, (1) Quintiles receives a written Acquisition Proposal that the Quintiles Board believes in good faith to be bona fide, (2) such
Acquisition Proposal was unsolicited and did not otherwise result from a material breach of this
Section 5.2
, (3) the Quintiles Board determines in good faith (after consultation with outside counsel and its financial advisor) that such
Acquisition Proposal constitutes or could reasonably be expected to lead to a Superior Proposal, and (4) the Quintiles Board determines in good faith (after consultation with outside counsel) that the failure to take the actions referred to in
clause (x) or (y) below would be inconsistent with its fiduciary duties to the stockholders of Quintiles under applicable Law, then Quintiles may (x) furnish information with respect to Quintiles and its Subsidiaries to the Person making such
Acquisition Proposal pursuant to a customary confidentiality agreement containing terms substantially similar to, and no less favorable to the disclosing party than, those set forth in the Confidentiality Agreement (excluding any standstill
agreement contained therein) (an
Acceptable Confidentiality Agreement
);
provided
, that (I) Quintiles shall provide IMS Health a non-redacted copy of each confidentiality agreement Quintiles has executed in accordance
with this
Section 5.2
and (II) that any non-public information provided to any such Person shall have been previously provided to IMS Health or shall be provided to IMS Health prior to or substantially concurrently with the time it is
provided to such Person, and (y) participate in discussions or negotiations with the Person making such Acquisition Proposal regarding such Acquisition Proposal. Quintiles shall not provide (and shall not permit any of its Representatives to
provide) any commercially or competitively sensitive non-public information in connection with the actions permitted by this
Section 5.2(a)
, except in accordance with clean room or other similar procedures designed to limit
any adverse effect of the sharing of such information on Quintiles, which procedures shall be consistent in all material respects with Quintiles practices in dealing with the disclosures of such information to IMS Health or its
Representatives.
(b) Neither the Quintiles Board nor any committee thereof shall:
(i) (A) withdraw, qualify or modify, or propose publicly to withdraw, qualify or modify, or fail to make, in each case in a
manner adverse to IMS Health, the approval or recommendation by such
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Quintiles Board or such committee of this Agreement, the Merger or any of the transactions contemplated hereby, (B) approve or recommend, or propose publicly to approve or recommend, to the
Quintiles stockholders of any Acquisition Proposal, or (C) resolve or agree to take any such actions (each such action set forth in this
Section 5.2(b)(i)
being referred to herein as a
Quintiles Adverse Recommendation
Change
); or
(ii) except as expressly contemplated by
Section 7.1(d)(iii)
, cause or permit Quintiles
or any of its Subsidiaries to enter into any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, option agreement, joint venture agreement, partnership agreement or other Contract, except
for an Acceptable Confidentiality Agreement, in each case constituting or related to, or which is intended to or is reasonably likely to lead to, any Acquisition Proposal (each, an
Alternative Acquisition Agreement
), or resolve,
agree or propose to take any such actions.
Notwithstanding the foregoing, at any time prior to obtaining the Quintiles Stockholder
Approval, the Quintiles Board may, if the Quintiles Board determines in good faith (after consultation with outside counsel) that the failure to do so would be inconsistent with its fiduciary duties to the stockholders of Quintiles under applicable
Law, taking into account all adjustments to the terms of this Agreement that may be offered by IMS Health pursuant to this
Section 5.2
, make a Quintiles Adverse Recommendation Change in response to either (x) a Superior Proposal or
(y) an Intervening Event;
provided
,
however
, that Quintiles may not make a Quintiles Adverse Recommendation Change in response to a Superior Proposal unless:
(A) Quintiles notifies IMS Health in writing at least four (4) Business Days before taking that action of its intention to do so, and specifies
the reasons therefor, including the terms and conditions of, and the identity of the Person making, such Superior Proposal, and contemporaneously furnishes a copy (if any) of the proposed Alternative Acquisition Agreement and any other relevant
transaction documents (it being understood and agreed that any amendment to the financial terms or any other material term of such Superior Proposal shall require a new written notice by Quintiles and an additional two (2) Business Day period);
and
(B) if IMS Health makes a proposal during such period to adjust the terms and conditions of this Agreement, the Quintiles Board,
after taking into consideration the adjusted terms and conditions of this Agreement as proposed by IMS Health, continues to determine in good faith (after consultation with outside counsel and its financial advisor) that such Superior Proposal
continues to be a Superior Proposal and that the failure to make a Quintiles Adverse Recommendation Change would be inconsistent with its fiduciary duties to the stockholders of Quintiles under applicable Law;
provided
,
further
, that
the Quintiles Board may not make a Quintiles Adverse Recommendation Change in response to an Intervening Event unless:
(1) Quintiles
provides IMS Health with written information describing such Intervening Event in reasonable detail;
(2) Quintiles keeps IMS Health
reasonably informed of developments with respect to such Intervening Event;
(3) Quintiles notifies IMS Health in writing at least four
(4) Business Days before making a Quintiles Adverse Recommendation Change with respect to such Intervening Event of its intention to do so and specifies the reasons therefor; and
(4) if IMS Health makes a proposal during such period to adjust the terms and conditions of this Agreement, the Quintiles Board, after taking
into consideration the adjusted terms and conditions of this Agreement as proposed by IMS Health, continues to determine in good faith (after consultation with outside counsel) that the failure to make such Quintiles Adverse Recommendation Change
would be inconsistent with its fiduciary duties to the stockholders of Quintiles under applicable Law.
During the period prior to its effecting a
Quintiles Adverse Recommendation Change as referred to above, Quintiles shall, and shall cause its financial and legal advisors to, negotiate with IMS Health in good faith (to the
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extent IMS Health seeks to negotiate) regarding any revisions to the terms of the transactions contemplated by this Agreement proposed by IMS Health. Notwithstanding anything to the contrary
contained herein, neither Quintiles nor any of its Subsidiaries shall enter into any Alternative Acquisition Agreement or submit to the vote of its stockholders any Acquisition Proposal (other than the Merger) unless this Agreement has been
terminated in accordance with its terms.
(c) In addition to the obligations of Quintiles set forth in
Section 5.2(a)
and
Section 5.2(b)
, Quintiles promptly (and in any event within 24 hours of receipt) shall advise IMS Health in writing in the event Quintiles or any of its Subsidiaries or Representatives receives (i) any inquiry or request for information,
discussion or negotiation that is reasonably likely to lead to or that contemplates an Acquisition Proposal, or (ii) any proposal or offer that is or is reasonably likely to lead to an Acquisition Proposal, in each case together with a description
of the material terms and conditions of and facts surrounding any such indication, inquiry, request, proposal or offer, the identity of the Person making any such indication, inquiry, request, proposal or offer, and a copy of any written proposal,
offer or draft agreement provided by such Person. Quintiles shall keep IMS Health informed in all material respects on a timely basis of the status and details of any such Acquisition Proposal, request, inquiry, proposal or offer, including
furnishing copies of any written inquiries, correspondence and draft documentation. Without limiting any of the foregoing, Quintiles shall promptly (and in any event within 24 hours) notify IMS Health orally and in writing if it determines to begin
providing information or to engage in discussions or negotiations concerning an Acquisition Proposal pursuant to
Section 5.2(a)
or
Section 5.2(b)
and shall in no event begin providing such information or engaging in such
discussions or negotiations prior to providing such notice.
(d) Quintiles agrees that any violation of the restrictions set forth in this
Section 5.2
by any Representative of Quintiles or any of its Subsidiaries, whether or not such Person is purporting to act on behalf of Quintiles or any of its Subsidiaries or otherwise, shall be deemed to be a breach of this Agreement
by Quintiles.
(e) Quintiles shall not, and shall cause its Subsidiaries not to, enter into any confidentiality agreement with any Person
subsequent to the date of this Agreement that would restrict Quintiles ability to comply with any of the terms of this
Section 5.2
, and represents that neither it nor any of its Subsidiaries is a party to any such agreement.
(f) Quintiles shall not take any action to exempt any Person (other than IMS Health and its respective Affiliates) from the restrictions on
business combinations contained in The North Carolina Shareholder Protection Act (NCBCA Art. 9) or The North Carolina Control Share Acquisition Act (NCBCA Art. 9A) (or any similar provision of any other Takeover Law or the Quintiles
Charter or the Quintiles Bylaws) or otherwise cause such restrictions not to apply, or agree to do any of the foregoing, in each case unless this Agreement has been terminated in accordance with its terms (including the payment of the Quintiles
Termination Fee pursuant to
Section 7.3(b)
, if applicable).
(g) Nothing contained in this Agreement shall prohibit Quintiles
or the Quintiles Board from (i) disclosing to its stockholders a position contemplated by Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act or (ii) making any disclosure to its stockholders if the Quintiles Board has reasonably
determined in good faith after consultation with Quintiles outside legal counsel that the failure to do so would be inconsistent with the duties of the members of the Quintiles Board under applicable Law;
provided
, that this
Section 5.2(g)
shall not permit the Quintiles Board to make a Quintiles Adverse Recommendation Change except to the extent permitted by
Section 5.2(b)
.
(h) For purposes of this Agreement:
(i)
Acquisition Proposal
means, with respect to any party, any proposal or offer with respect to any direct
or indirect acquisition or purchase, in one transaction or a series of transactions, and whether through any merger, reorganization, consolidation, tender offer, self-tender, exchange offer, stock
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acquisition, asset acquisition, binding share exchange, business combination, recapitalization, liquidation, dissolution, joint venture or otherwise, of (A) assets or businesses of such
party and its respective Subsidiaries that generate 15% or more of the net revenues or net income (for the 12-month period ending on the last day of such partys most recently completed fiscal quarter) or that represent 15% or more of the total
assets (based on fair market value) of such party and its respective Subsidiaries, taken as a whole, immediately prior to such transaction, or (B) 15% or more of any class of capital stock, other equity securities or voting power of such party,
any of its respective Subsidiaries or any resulting parent company of such party, in each case other than the Merger and other transactions contemplated by this Agreement.
(ii)
Superior Proposal
means any unsolicited bona fide binding written Acquisition Proposal that is fully
financed or has fully committed financing that the Quintiles Board or the IMS Health Board, as applicable, determines in good faith (after consultation with outside counsel and its financial advisor), taking into account all legal, financial,
regulatory and other aspects of the proposal and the Person making the proposal, is (A) more favorable to the stockholders of the applicable party from a financial point of view than the Merger and the other transactions contemplated by this
Agreement (including any adjustment to the terms and conditions proposed by the other party in response to such proposal) and (B) reasonably likely of being completed on the terms proposed on a timely basis;
provided
, that, for purposes
of this definition of Superior Proposal, references in the term Acquisition Proposal to 15% shall be deemed to be references to 50%; and
(iii)
Intervening Event
means a material Effect that was not known to, or reasonably foreseeable by, the
Quintiles Board or the IMS Health Board, as applicable, prior to the execution of this Agreement (or if known or reasonably foreseeable, the material consequences of which were not known or reasonably foreseeable), which Effect, or any material
consequence thereof, becomes known to, or reasonably foreseeable by, the Quintiles Board or the IMS Health Board, as applicable, prior to the receipt of the Quintiles Stockholder Approval or the IMS Health Stockholder Approval, as applicable, and
that does not relate to (A) an Acquisition Proposal or (B) any changes in the market price or trading volume of IMS Health Common Stock or Quintiles Common Stock, in and of itself (it being understood that the facts or occurrences giving rise
or contributing to such change may be taken into account when determining an Intervening Event).
Section 5.3
Covenants of IMS
Health Regarding No Solicitation; Recommendation of the Merger
(a) IMS Health shall not, and shall not permit or authorize any of its
Subsidiaries or any Representatives of IMS Health or any of its Subsidiaries, directly or indirectly, to (i) solicit, initiate, endorse, knowingly encourage (including by way of furnishing information) or take any action to knowingly facilitate any
inquiry, proposal or offer with respect to, or the making or completion of, any Acquisition Proposal, or any inquiry, proposal or offer that is reasonably likely to lead to any Acquisition Proposal, (ii) other than to inform any Person of the
existence of the provisions contained in this
Section 5.3
, enter into, continue or otherwise participate in any discussions or negotiations regarding, or furnish to any Person any information or data with respect to, or otherwise cooperate in
any way with, any Acquisition Proposal or (iii) resolve, agree or propose to do any of the foregoing. IMS Health shall, and shall cause each of its Subsidiaries and the Representatives of IMS Health and its Subsidiaries to, (A) immediately
cease and cause to be terminated all existing discussions and negotiations with any Person conducted heretofore with respect to any Acquisition Proposal or potential Acquisition Proposal and immediately terminate all physical and electronic data
room access previously granted to any such Person, (B) request the prompt return or destruction of all confidential information previously furnished with respect to any Acquisition Proposal or potential Acquisition Proposal, and (C) not
terminate, waive, amend, release or modify any provision of any confidentiality or standstill agreement to which it or any of its Affiliates or Representatives is a party with respect to any Acquisition Proposal or potential Acquisition Proposal,
and shall enforce the provisions of any such agreement, which shall include seeking any injunctive relief available to enforce such agreement. Notwithstanding the foregoing, if at any time following the date of this Agreement and prior to obtaining
the IMS Health Stockholder Approval, (1) IMS Health receives a written
A-46
Acquisition Proposal that the IMS Health Board believes in good faith to be bona fide, (2) such Acquisition Proposal was unsolicited and did not otherwise result from a material breach of
this
Section 5.3
, (3) the IMS Health Board determines in good faith (after consultation with outside counsel and its financial advisor) that such Acquisition Proposal constitutes or could reasonably be expected to lead to a Superior
Proposal, and (4) the IMS Health Board determines in good faith (after consultation with outside counsel) that the failure to take the actions referred to in clause (x) or (y) below would be inconsistent with its fiduciary duties to
the stockholders of IMS Health under applicable Law, then IMS Health may (x) furnish information with respect to IMS Health and its Subsidiaries to the Person making such Acquisition Proposal pursuant to an Acceptable Confidentiality Agreement;
provided
, that (I) IMS Health shall provide Quintiles a non-redacted copy of each confidentiality agreement IMS Health has executed in accordance with this
Section 5.3
and (II) that any non-public information provided to any
such Person shall have been previously provided to Quintiles or shall be provided to Quintiles prior to or substantially concurrently with the time it is provided to such Person, and (y) participate in discussions or negotiations with the
Person making such Acquisition Proposal regarding such Acquisition Proposal. IMS Health shall not provide (and shall not permit any of its Representatives to provide) any commercially or competitively sensitive non-public information in connection
with the actions permitted by this
Section 5.3(a)
, except in accordance with clean room or other similar procedures designed to limit any adverse effect of the sharing of such information on IMS Health, which procedures shall
be consistent in all material respects with IMS Healths practices in dealing with the disclosures of such information to Quintiles or its Representatives.
(b) Neither the IMS Health Board nor any committee thereof shall:
(i) (A) withdraw, qualify or modify, or propose publicly to withdraw, qualify or modify, or fail to make, in each case in a
manner adverse to Quintiles, the approval or recommendation by such IMS Health Board or such committee of this Agreement, the Merger or any of the transactions contemplated hereby, (B) approve or recommend, or propose publicly to approve or
recommend, to the IMS Health stockholders of any Acquisition Proposal, or (C) resolve, or agree to take any such actions (each such action set forth in this
Section 5.3(b)(i)
being referred to herein as an
IMS Health
Adverse Recommendation Change
); or
(ii) except as contemplated by
Section 7.1(c)(iii)
, cause or
permit IMS Health or any of its Subsidiaries to enter into any Alternative Acquisition Agreement, or resolve, agree or propose to take any such actions.
Notwithstanding the foregoing, at any time prior to obtaining the IMS Health Stockholder Approval, the IMS Health Board may, if the IMS Health
Board determines in good faith (after consultation with outside counsel) that the failure to do so would be inconsistent with its fiduciary duties to the stockholders of IMS Health under applicable Law, taking into account all adjustments to the
terms of this Agreement that may be offered by Quintiles pursuant to this
Section 5.3
, make an IMS Health Adverse Recommendation Change in response to either (x) a Superior Proposal or (y) an Intervening Event;
provided
,
however
, that IMS Health may not make an IMS Health Adverse Recommendation Change in response to a Superior Proposal unless:
(A)
IMS Health notifies Quintiles in writing at least four (4) Business Days before taking that action of its intention to do so, and specifies the reasons therefor, including the terms and conditions of, and the identity of the Person making, such
Superior Proposal, and contemporaneously furnishes a copy (if any) of the proposed Alternative Acquisition Agreement and any other relevant transaction documents (it being understood and agreed that any amendment to the financial terms or any other
material term of such Superior Proposal shall require a new written notice by IMS Health and an additional two (2) Business Day period); and
(B) if Quintiles makes a proposal during such period to adjust the terms and conditions of this Agreement, the IMS Health Board, after taking
into consideration the adjusted terms and conditions of this Agreement as proposed by Quintiles, continues to determine in good faith (after consultation with outside counsel and its financial advisor) that such Superior Proposal continues to be a
Superior Proposal and that the failure to make an IMS Health Adverse Recommendation Change would be inconsistent with its fiduciary duties
A-47
to the stockholders of IMS Health under applicable Law;
provided
further
, that the IMS Health Board may not make an IMS Health Adverse Recommendation Change in response to an
Intervening Event unless:
(1) IMS Health provides Quintiles with written information describing such Intervening Event in reasonable
detail;
(2) IMS Health keeps Quintiles reasonably informed of developments with respect to such Intervening Event;
(3) IMS Health notifies Quintiles in writing at least four (4) Business Days before making an IMS Health Adverse Recommendation Change
with respect to such Intervening Event of its intention to do so and specifies the reasons therefor; and
(4) if Quintiles makes a
proposal during such period to adjust the terms and conditions of this Agreement, the IMS Health Board, after taking into consideration the adjusted terms and conditions of this Agreement as proposed by Quintiles, continues to determine in good
faith (after consultation with outside counsel) that the failure to make such IMS Health Adverse Recommendation Change would be inconsistent with its fiduciary duties to the stockholders of IMS Health under applicable Law.
During the period prior to its effecting an IMS Health Adverse Recommendation Change as referred to above, IMS Health shall, and shall cause its financial and
legal advisors to, negotiate with Quintiles in good faith (to the extent Quintiles seeks to negotiate) regarding any revisions to the terms of the transactions contemplated by this Agreement proposed by Quintiles. Notwithstanding anything to the
contrary contained herein, neither IMS Health nor any of its Subsidiaries shall enter into any Alternative Acquisition Agreement or submit to the vote of its stockholders any Acquisition Proposal unless this Agreement has been terminated in
accordance with its terms.
(c) In addition to the obligations of IMS Health set forth in
Section 5.3(a)
and
Section 5.3(b)
, IMS Health promptly (and in any event within 24 hours of receipt) shall advise Quintiles in writing in the event IMS Health or any of its Subsidiaries or Representatives receives (i) any inquiry or request for
information, discussion or negotiation that is reasonably likely to lead to or that contemplates an Acquisition Proposal or (ii) any proposal or offer that is or is reasonably likely to lead to an Acquisition Proposal, in each case together
with a description of the material terms and conditions of and facts surrounding any such indication, inquiry, request, proposal or offer, the identity of the Person making any such indication, inquiry, request, proposal or offer, and a copy of any
written proposal, offer or draft agreement provided by such Person. IMS Health shall keep Quintiles informed in all material respects on a timely basis of the status and details of any such Acquisition Proposal, request, inquiry, proposal or offer,
including furnishing copies of any written inquiries, correspondence and draft documentation. Without limiting any of the foregoing, IMS Health shall promptly (and in any event within 24 hours) notify Quintiles orally and in writing if it determines
to begin providing information or to engage in discussions or negotiations concerning an Acquisition Proposal pursuant to
Section 5.3(a)
or
Section 5.3(b)
and shall in no event begin providing such information or engaging in
such discussions or negotiations prior to providing such notice.
(d) IMS Health agrees that any violation of the restrictions set forth
in this
Section 5.3
by any Representative of IMS Health or any of its Subsidiaries, whether or not such Person is purporting to act on behalf of IMS Health or any of its Subsidiaries or otherwise, shall be deemed to be a breach of this
Agreement by IMS Health.
(e) IMS Health shall not, and shall cause its Subsidiaries not to, enter into any confidentiality agreement with
any Person subsequent to the date of this Agreement that would restrict IMS Healths ability to comply with any of the terms of this
Section 5.3
, and represents that neither it nor any of its Subsidiaries is a party to any such
agreement.
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(f) IMS Health shall not take any action to exempt any Person (other than Quintiles and its
respective Affiliates) from the restrictions on business combinations contained in Section 203 of the DGCL (or any similar provision of any other Takeover Law or the IMS Health Charter or the IMS Health Bylaws) or otherwise cause
such restrictions not to apply, or agree to do any of the foregoing, in each case unless this Agreement has been terminated in accordance with its terms (including the payment of the IMS Health Termination Fee pursuant to
Section 7.3(c)
,
if applicable).
(g) Nothing contained in this Agreement shall prohibit IMS Health or the IMS Health Board from (i) disclosing to its
stockholders a position contemplated by Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act or (ii) making any disclosure to its stockholders if the Quintiles Board has reasonably determined in good faith after consultation with IMS
Healths outside legal counsel that the failure to do so would be inconsistent with the duties of the members of the IMS Health Board under applicable Law;
provided
, that this
Section 5.3(g)
shall not permit the IMS Health
Board to make an IMS Health Adverse Recommendation Change except to the extent permitted by
Section 5.3(b)
.
Section 5.4
Preparation of Form S-4 and the Joint Proxy Statement/Prospectus; Stockholders Meetings
.
(a) As promptly as practicable after the
date of this Agreement, IMS Health and Quintiles shall jointly prepare and cause to be filed with the SEC a proxy statement (as amended or supplemented from time to time, the
Joint Proxy Statement/Prospectus
) with respect to the
special meeting of IMS Healths stockholders (the
IMS Health Stockholders Meeting
) and the special meeting of Quintiles stockholders (the
Quintiles Stockholders Meeting
). As promptly as practicable
following the date of this Agreement, Quintiles shall prepare (with IMS Healths reasonable cooperation) and file with the SEC a registration statement on Form S-4 (as amended or supplemented from time to time, the
Form S-4
),
in which the Joint Proxy Statement/Prospectus will be included as a prospectus, in connection with the registration under the Securities Act of the Surviving Corporation Common Stock to be issued in the Merger. Quintiles shall use its reasonable
best efforts to have the Form S-4 declared effective under the Securities Act as promptly as practicable after such filing and to keep the Form S-4 effective as long as is necessary to consummate the Merger and the other transactions contemplated
hereby. Quintiles shall also take any action (other than qualifying to do business in any jurisdiction in which it is not now so qualified or filing a general consent to service of process) required to be taken under any applicable state securities
or blue sky laws in connection with the issuance of shares of Surviving Corporation Common Stock in the Merger. Each of Quintiles and IMS Health shall furnish all information concerning Quintiles and the holders of Quintiles Common Stock
and IMS Health and the holders of IMS Health Common Stock, as applicable, as may be reasonably requested in connection with any such action. Each of Quintiles and IMS Health shall use reasonable best efforts to cause the Joint Proxy
Statement/Prospectus to be mailed to Quintiles stockholders and IMS Healths stockholders, as applicable, as promptly as practicable after the Form S-4 is declared effective under the Securities Act.
(b) No filing of, or amendment or supplement to, the Form S-4 or the Joint Proxy Statement/Prospectus will be made by IMS Health or Quintiles,
as applicable, without providing the other a reasonable opportunity to review and comment thereon and without the others prior approval (which shall not be unreasonably withheld). IMS Health or Quintiles, as applicable, will advise the other
promptly after it receives oral or written notice thereof, of the time when the Form S-4 has become effective or any amendment or supplement thereto has been filed, the issuance of any stop order, the suspension of the qualification of the Surviving
Corporation Common Stock issuable in connection with the Merger for offering or sale in any jurisdiction or any oral or written request by the SEC for amendment of the Joint Proxy Statement/Prospectus or the Form S-4 or comments thereon and
responses thereto or requests by the SEC for additional information, and will promptly provide the other with copies of any written communication from the SEC or any state securities commission and a reasonable opportunity to participate in the
responses thereto. If at any time prior to the Effective Time any information relating to Quintiles or IMS Health, or any of their respective Affiliates, officers or directors, should be discovered by Quintiles or IMS Health that should be set forth
in an amendment or supplement to any of the Form S-4 or the Joint Proxy Statement/Prospectus, so that any of such documents would not contain any
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misstatement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the
party that discovers such information shall promptly notify the other parties hereto and Quintiles and IMS Health shall cooperate in the prompt filing with the SEC of an appropriate amendment or supplement describing such information and, to the
extent required under applicable Law, in disseminating the information contained in such amendment or supplement to Quintiles stockholders and IMS Healths stockholders;
provided
, that the delivery of such notice and the filing of
any such amendment or supplement shall not affect or be deemed to modify any representation or warranty made by any party hereunder or otherwise affect the remedies available hereunder to any party.
(c) As promptly as practicable after the Form S-4 is declared effective under the Securities Act, Quintiles shall duly call, give notice of,
convene and hold the Quintiles Stockholders Meeting solely for the purpose of obtaining the Quintiles Stockholder Approval, any other matters required under applicable Law to be considered at the Quintiles Stockholders Meeting, the advisory vote
required by Rule 14a-21(c) under the Exchange Act in connection therewith, if applicable, and to adjourn the Quintiles Stockholders Meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes to approve the
other proposals. Such Quintiles Stockholders Meeting shall in any event be no later than sixty (60) calendar days after (i) the tenth (10th) calendar day after the preliminary Joint Proxy Statement/Prospectus therefor has been filed with the SEC if
by such date the SEC has not informed Quintiles that it intends to review the Joint Proxy Statement/Prospectus or (ii) if the SEC has, by the tenth (10th) calendar day after the preliminary Joint Proxy Statement/Prospectus therefor has been filed
with the SEC, informed Quintiles that it intends to review the Joint Proxy Statement/Prospectus, the date on which the SEC confirms that it has no further comments on the Joint Proxy Statement/Prospectus. Quintiles may postpone or adjourn the
Quintiles Stockholders Meeting solely (i) with the consent of IMS Health; (ii) (A) due to the absence of a quorum or (B) if Quintiles has not received proxies representing a sufficient number of shares for the Quintiles Stockholder Approval, whether
or not a quorum is present, to solicit additional proxies; or (iii) to allow reasonable additional time for the filing and mailing of any supplemental or amended disclosure which the Quintiles Board has determined in good faith after consultation
with outside legal counsel is necessary under applicable Law and for such supplemental or amended disclosure to be disseminated and reviewed by Quintiles stockholders prior to the Quintiles Stockholders Meeting;
provided
, that Quintiles
may not postpone or adjourn the Quintiles Stockholders Meeting more than a total of two times pursuant to clause (ii) (A) and/or clause (ii) (B) of this
Section 5.4(c)
. Notwithstanding the foregoing, Quintiles shall, at the request of IMS
Health, to the extent permitted by Law, adjourn the Quintiles Stockholders Meeting to a date specified by IMS Health for the absence of a quorum or if Quintiles has not received proxies representing a sufficient number of shares for the Quintiles
Stockholder Approval;
provided
, that Quintiles shall not be required to adjourn the Quintiles Stockholders Meeting more than two times pursuant to this sentence, and no such adjournment pursuant to this sentence shall be required to be for a
period exceeding fifteen (15) Business Days. Except in the case of a Quintiles Adverse Recommendation Change specifically permitted by
Section 5.2(b)
, Quintiles, through the Quintiles Board, shall (i) recommend to its stockholders
that they adopt this Agreement and the transactions contemplated hereby (the
Quintiles Recommendation
) and (ii) include the Quintiles Recommendation in the Joint Proxy Statement/Prospectus.
(d) As promptly as practicable after the Form S-4 is declared effective under the Securities Act, IMS Health shall duly call, give notice of,
convene and hold the IMS Health Stockholders Meeting solely for the purpose of obtaining the IMS Health Stockholder Approval, any other matters required under applicable Law to be considered at the IMS Health Stockholders Meeting, the advisory vote
required by Rule 14a-21(c) under the Exchange Act in connection therewith, if applicable, and to adjourn the IMS Health Stockholders Meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes to approve the
other proposals. Such IMS Health Stockholders Meeting shall in any event be no later than sixty (60) calendar days after (i) the tenth (10th) calendar day after the preliminary Joint Proxy Statement/Prospectus therefor has been filed
with the SEC if by such date the SEC has not informed IMS Health that it intends to review the Joint Proxy Statement/Prospectus or (ii) if the SEC has, by the tenth (10th) calendar day after the preliminary Joint Proxy Statement/Prospectus
therefor has been filed with the SEC, informed IMS Health that it intends to review the Joint Proxy Statement/Prospectus, the date on which the SEC confirms that it has no further comments on the
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Joint Proxy Statement/Prospectus. IMS Health may postpone or adjourn the IMS Health Stockholders Meeting solely (i) with the consent of Quintiles; (ii) (A) due to the absence of a
quorum or (B) if IMS Health has not received proxies representing a sufficient number of shares for the IMS Health Stockholder Approval, whether or not a quorum is present, to solicit additional proxies; or (iii) to allow reasonable
additional time for the filing and mailing of any supplemental or amended disclosure which the IMS Health Board has determined in good faith after consultation with outside legal counsel is necessary under applicable Law and for such supplemental or
amended disclosure to be disseminated and reviewed by IMS Healths stockholders prior to the IMS Health Stockholders Meeting;
provided
, that IMS Health may not postpone or adjourn the IMS Health Stockholders Meeting more than a total of
two times pursuant to clause (ii) (A) and/or clause (ii) (B) of this
Section 5.4(d)
. Notwithstanding the foregoing, IMS Health shall, at the request of Quintiles, to the extent permitted by Law, adjourn the IMS Health Stockholders
Meeting to a date specified by Quintiles for the absence of a quorum or if IMS Health has not received proxies representing a sufficient number of shares for the IMS Health Stockholder Approval;
provided
, that IMS Health shall not be required
to adjourn the IMS Health Stockholders Meeting more than two times pursuant to this sentence, and no such adjournment pursuant to this sentence shall be required to be for a period exceeding fifteen (15) Business Days. Except in the case of an
IMS Health Adverse Recommendation Change specifically permitted by
Section 5.3(b)
, IMS Health, through the IMS Health Board, shall (i) recommend to its stockholders that they adopt this Agreement and the transactions contemplated
hereby (the
IMS Health Recommendation
) and (ii) include the IMS Health Recommendation in the Joint Proxy Statement/Prospectus.
(e) IMS Health and Quintiles shall use reasonable best efforts to hold the IMS Health Stockholders Meeting and the Quintiles Stockholders
Meeting on the same date.
Section 5.5
Access to Information; Confidentiality
.
(a) From the date hereof to the Effective Time or the earlier termination of this Agreement, upon reasonable prior written notice, Quintiles
and IMS Health shall each, and shall use its reasonable best efforts to cause each of their respective Subsidiaries, officers, directors and representative to, afford to the other reasonable access during normal business hours, consistent with
applicable Law, to each of its respective officers, employees, properties, offices, other facilities and books and records, and shall furnish the other with all financial, operating and other data and information as the other shall reasonably
request in writing (it being agreed, however, that the foregoing shall not permit the other or its respective officers, employees or representatives to conduct any environmental testing or sampling, including but not limited to facility surface and
subsurface soils and water, air or building materials). Notwithstanding the foregoing, any such investigation or consultation shall be conducted in such a manner as not to interfere unreasonably with the business or operations of the other party or
its Subsidiaries or otherwise result in any significant interference with the prompt and timely discharge by the employees of the other party of their normal duties. Neither party nor any of its Subsidiaries shall be required to provide access to or
to disclose information where such access or disclosure would (i) breach any agreement with any third-party, (ii) constitute a waiver of or jeopardize the attorney-client or other privilege held by such party or (iii) otherwise
violate any applicable Law, including any Antitrust Law.
(b) The parties will hold and treat and will cause its respective
Representatives to hold and treat in confidence all documents and information concerning the other furnished to each other in connection with the transactions contemplated by this Agreement in accordance with the Confidentiality Agreement, dated
December 18, 2015, between IMS Health and Quintiles (the
Confidentiality Agreement
), which Confidentiality Agreement shall remain in full force and effect in accordance with its terms. In addition, notwithstanding anything
herein or in the Confidentiality Agreement, each of the parties hereto agrees that IMS Health shall be permitted to disclose information to the Debt Financing Sources, rating agencies and/or prospective lenders or purchasers, subject to such Debt
Financing Sources, ratings agencies and/or prospective lenders or purchasers being informed of the confidential nature of such information.
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Section 5.6
Reasonable Best Efforts
.
(a) Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use reasonable best efforts to
take, or cause to be taken, all actions that are necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Merger and the other transactions contemplated by this Agreement, including using
reasonable best efforts to accomplish the following: (i) obtain all required consents, approvals or waivers from, or participation in other discussions or negotiations with, third parties, including as required under any Quintiles Material Contract
or IMS Health Material Contract, as applicable, (ii) obtain all necessary actions or nonactions, waivers, consents, approvals, orders and authorizations from Governmental Entities, make all necessary registrations, declarations and filings with and
make all reasonable best efforts to obtain an approval or waiver from, or to avoid any Action by, any Governmental Entity with respect to this Agreement required under applicable Law, including the HSR Act and any other applicable Antitrust Laws and
(iii) execute and deliver any additional instruments necessary to consummate the transactions contemplated hereby and fully to carry out the purposes of this Agreement;
provided
,
however
, that neither Quintiles, IMS Health nor any
of their respective Subsidiaries shall commit to the payment of any fee, penalty or other consideration or make any other concession, waiver or amendment under any Contract in connection with obtaining any consent without the prior written consent
of the other party.
(b) Quintiles and IMS Health agree to make, and to cause their respective Affiliates to make, any necessary filings
under the HSR Act and any other Antitrust Laws as soon as reasonably practicable after execution of this Agreement. Quintiles and IMS Health shall, and shall cause their respective Affiliates to, comply at the earliest practicable date with any
request under the HSR Act or any other Antitrust Laws to provide information, documents or other materials requested by any Governmental Entity.
(c) Quintiles and IMS Health shall each request early termination of the waiting period provided for in the HSR Act. Quintiles and IMS Health
shall, and shall cause their respective Affiliates to, coordinate and cooperate in connection with their respective efforts to obtain termination or expiration of the applicable waiting period and all requisite clearances and approvals under the HSR
Act and any other Antitrust Laws as promptly as practicable and in any event before the Outside Date. In connection with any investigation or other inquiry, Quintiles and IMS Health shall, and shall cause their respective Affiliates to, unless
prohibited by applicable Law or a Governmental Entity, (i) keep the other party promptly informed of any communication received by such party or any of its Affiliates from any Governmental Entity regarding any of the transactions contemplated
hereby, and (ii) provide outside counsel for the other party with a reasonable opportunity to (A) review in advance any proposed communication by such party or its Affiliates with any Governmental Entity, (B) consult with the other
party prior to any meeting or conference with any Governmental Entity, and (C) attend and participate in such meetings or conferences. Without the prior written consent of the other party, Quintiles and IMS Health will not, and will not permit
their respective Affiliates to consent or agree to extend the waiting period under the HSR Act or enter into any agreement with any Governmental Entity with respect to the transactions contemplated by this Agreement.
(d) Each of Quintiles and IMS Health may, as each deems advisable and necessary, reasonably designate any competitively sensitive material
provided to the other under this
Section 5.6
as outside counsel only. Such competitively sensitive material and the information contained therein shall be given only to the outside legal counsel of the recipient and will not
be disclosed by such outside counsel to employees, officers or directors of the recipient unless express permission is obtained in advance from Quintiles or IMS Health, as the case may be, or its legal counsel.
(e) In furtherance and not in limitation of the covenants of the parties contained in this
Section 5.6
, Quintiles and IMS Health shall,
and shall cause their respective Affiliates to, take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by this
Agreement, to resolve such objections, if any, as any Governmental Entity may assert under the HSR Act or any other Antitrust Laws with respect to the transactions contemplated by this Agreement, and to avoid or eliminate each and every impediment
and avoid the institution of any Action under any such Law that may be asserted by any Governmental Entity with respect to the
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transactions contemplated by this Agreement, in each case so as to enable the Merger to occur as promptly as possible and in any event before the Outside Date, including by (i) proposing,
negotiating, committing to and effecting, by consent decree, hold separate order or otherwise, the sale, divestiture or disposition of any assets or businesses of Quintiles or its Subsidiaries or IMS Health or its Subsidiaries, (ii) terminating
existing, or creating new, relationships, contractual rights or obligations of Quintiles or its Subsidiaries or IMS Health or its Subsidiaries or (iii) effectuating any other change or restructuring of Quintiles or its Subsidiaries or IMS
Health or its Subsidiaries or otherwise taking or committing to take any actions that limit the freedom of action of Quintiles or its Subsidiaries or IMS Health or its Subsidiaries with respect to, or ability to retain, one or more assets or
businesses, to ensure that no Governmental Entity enters any temporary restraining order, preliminary or permanent injunction or other judgment, order or decree or establishes any Law preliminarily or permanently restraining, enjoining or
prohibiting the consummation of the transactions contemplated by this Agreement, or to ensure that no Governmental Entity with the authority to authorize or approve such consummation fails to do so as promptly as practicable and in any event before
the Outside Date;
provided
,
however
, that, notwithstanding anything to the contrary contained in this Agreement, no such remedy shall be (A) required unless contingent upon the occurrence of the Merger, (B) proposed, agreed to or
effected by Quintiles or its Subsidiaries or IMS Health or its Subsidiaries without the prior written consent of the other party or (C) required to be agreed to by Quintiles or its Subsidiaries or IMS Health or its Subsidiaries if, in the
reasonable opinion of either party, such remedy would have a material adverse effect on the business, results of operations or financial condition of Quintiles, IMS Health and their Subsidiaries (taken as a whole, after giving effect to the Merger).
(f) Each of Quintiles and IMS Health shall, and shall cause its Affiliates to, cooperate and use their respective reasonable best efforts
to vigorously contest and resist any Action, including any administrative or judicial Action, and to have vacated, lifted, reversed or overturned any temporary restraining order, preliminary or permanent injunction or other judgment, order or decree
that is threatened or in effect and that restricts, prevents or prohibits consummation of the transactions contemplated by this Agreement under the HSR Act or any other Antitrust Laws, including by vigorously pursuing all available avenues of
administrative and judicial appeal;
provided
,
however
, that such obligation to contest and resist any Action in no way limits the obligation of Quintiles and IMS Health to, and to cause their Affiliates to, take, or cause to be taken,
all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by this Agreement as promptly as practicable and in any event before the Outside Date in
accordance with
Section 5.6(e)
.
(g) Neither Quintiles nor IMS Health shall, and neither Quintiles nor IMS Health shall permit
any of its Affiliates to, enter into any agreement, transaction or any agreement to effect any transaction (including any merger or acquisition) that would reasonably be expected to materially delay or materially and adversely affect the
parties ability to: (i) obtain termination or expiration of the applicable waiting period and all requisite clearances and approvals under the HSR Act and any other Antitrust Laws as promptly as practicable and in any event before the Outside
Date; and (ii) avoid the entry of, the commencement of any Action seeking the entry of, or effect the dissolution of, any temporary restraining order, preliminary or permanent injunction or other judgment, order or decree that restricts,
prevents or prohibits consummation of the transactions contemplated by this Agreement under the HSR Act or any other Antitrust Laws.
Section 5.7
Employment and Employee Benefits Matters
.
(a) As of the Effective Time, the Surviving Corporation shall assume sponsorship of and maintain the IMS Health Plans sponsored and maintained
by IMS Health immediately prior to the Closing Date (
IMS Health Benefit Plans
) under which each employee of IMS Health and its Subsidiaries who is employed immediately prior to the Closing and who continues employment with the
Surviving Corporation or any of its Subsidiaries thereafter (each such employee, a
Continuing Employee
) will continue to participate on and after the Closing Date. If after Closing a Continuing Employee becomes eligible to
participate in an employee benefit plan, program or policy of the Surviving Corporation or any of its Subsidiaries (
Surviving Corporation Benefit Plans
), the Surviving Corporation shall use commercially reasonable efforts, to the
extent permitted by the
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terms of the applicable Surviving Corporation Benefit Plan, to provide such Continuing Employee with credit for all service with IMS Health or its Subsidiaries as if such service were with the
Surviving Corporation and its Subsidiaries for purposes of determining eligibility, vesting, and level of benefits under Surviving Corporation Benefit Plans that provide severance, vacation and other benefits determined by the Surviving Corporation,
but not benefit accrual under any defined benefit pension plan. Unused vacation days accrued by Continuing Employees under the plans and policies of IMS Health and its Subsidiaries shall carry over to the Surviving Corporation. This
Section 5.7(a)
shall not operate to duplicate any benefit provided to any Continuing Employee under an IMS Health Benefit Plan or prohibit the termination of employment of any specific employee following the Effective Time.
(b) Nothing contained herein, express or implied shall (i) be construed to establish, amend or modify any benefit plan, program,
agreement, policy or arrangement or (ii) alter or limit the ability of the Surviving Corporation, IMS Health, Quintiles or any of their respective affiliates to amend, modify or terminate any benefit plan, program, agreement, policy or
arrangement at any time assumed, established, sponsored or maintained by any of them. This
Section 5.7
shall be binding upon and inure solely to the benefit of each of the parties to this Agreement, and nothing in this
Section 5.7
, express or implied, is intended to confer upon any other person any rights or remedies of any nature whatsoever under or by reason of this
Section 5.7
.
Section 5.8
Takeover Laws
. If any Takeover Law is or becomes applicable to this Agreement, the Merger or any of the other
transactions contemplated hereby, each of Quintiles and IMS Health and their respective Board of Directors shall take all action necessary to ensure that the Merger and the other transactions contemplated hereby may be consummated as promptly as
practicable on the terms contemplated by this Agreement and otherwise to eliminate or minimize the effect of such Takeover Law on this Agreement, the Merger and the other transactions contemplated hereby.
Section 5.9
Notification of Certain Matters
. Quintiles and IMS Health shall promptly notify each other of (a) any notice or
other communication received by such party from any Governmental Entity in connection with the Merger or the other transactions contemplated hereby or from any Person alleging that the consent of such Person is or may be required in connection with
the transactions contemplated hereby, (b) any other notice or communication from any Governmental Entity in connection with the transactions contemplated hereby, (c) any Action commenced or, to such partys knowledge, threatened
against, relating to or involving or otherwise affecting such party or any of its Subsidiaries which relate to the transactions contemplated hereby or (d) any change, condition or event (i) that renders or would reasonably be expected to
render any representation or warranty of such party set forth in this Agreement (disregarding any materiality qualification contained therein) to be untrue or inaccurate in any material respect or (ii) that results or would reasonably be
expected to result in any failure of such party to comply with or satisfy in any material respect any covenant, condition or agreement (including any condition set forth in Article VI) to be complied with or satisfied hereunder;
provided
,
however
, that no such notification shall affect any of the representations, warranties, covenants, rights or remedies, or the conditions to the obligations of, the parties hereunder;
provided
,
further
, that failure to give
prompt notice pursuant to clause (d) shall not constitute a failure of a condition to the Merger set forth in Article VI except to the extent that the underlying fact or circumstance not so notified would, standing alone, constitute such a
failure. The parties agree and acknowledge that neither Quintiles nor IMS Healths compliance or failure of compliance with this
Section 5.9
shall be taken into account for purposes of determining whether the conditions
referred to in
Section 6.2(b)
or
Section 6.3(b)
shall have been satisfied.
Section 5.10
Indemnification,
Exculpation and Insurance
.
(a) Without limiting any additional rights that any employee may have under any agreement or IMS Health
Plan, from the Effective Time through the sixth anniversary of the date on which the Effective Time occurs, the Surviving Corporation shall indemnify and hold harmless each present (as of the Effective Time) and former officer, director or employee
of IMS Health and its Subsidiaries (the
Indemnified Parties
), against all claims, losses, liabilities, damages, judgments, inquiries, fines and reasonable fees, costs and expenses, including
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attorneys fees and disbursements, incurred in connection with any Action, whether civil, criminal, administrative or investigative, arising out of or pertaining to (i) the fact that
the Indemnified Party is or was an officer, director, employee, fiduciary or agent of IMS Health or any of its Subsidiaries or (ii) matters existing or occurring at or prior to the Effective Time (including this Agreement and the transactions
and actions contemplated hereby), whether asserted or claimed prior to, at or after the Effective Time, to the fullest extent permitted under applicable Law. In the event of any such Action, (A) each Indemnified Party shall be entitled to
advancement of expenses incurred in the defense of any Action from the Surviving Corporation to the fullest extent permitted under applicable Law within ten (10) Business Days of receipt by the Surviving Corporation from the Indemnified Party
of a request therefor;
provided
, that any Person to whom expenses are advanced provides an undertaking, if and only to the extent required by applicable Law, to repay such advances if it is ultimately determined that such Person is not
entitled to indemnification, (B) the Surviving Corporation shall not settle, compromise or consent to the entry of any judgment in any proceeding or threatened action, suit, proceeding, investigation or claim (and in which indemnification could
be sought by such Indemnified Party hereunder), unless such settlement, compromise or consent includes an unconditional release of such Indemnified Party from all liability arising out of such action, suit, proceeding, investigation or claim or such
Indemnified Party otherwise consents, and (C) the Surviving Corporation shall cooperate in the defense of any such matter.
(b)
Except as may be required by applicable Law, IMS Health and Quintiles agree that all rights to indemnification and exculpation from liabilities for acts or omissions occurring at or prior to the Effective Time and rights to advancement of expenses
relating thereto now existing in favor of any Indemnified Party as provided in the certificate of incorporation or bylaws (or comparable organizational documents) of IMS Health and its Subsidiaries or in any indemnification agreement between such
Indemnified Party and IMS Health or any of its Subsidiaries shall survive the Merger and continue in full force and effect, and shall not be amended, repealed or otherwise modified in any manner that would adversely affect any right thereunder of
any such Indemnified Party.
(c) For a period of six years from the Effective Time, the Surviving Corporation shall either cause to be
maintained in effect the current policies of directors and officers liability insurance and fiduciary liability insurance maintained by IMS Health and its Subsidiaries or provide substitute policies or purchase a tail policy,
in any case of at least the same coverage and amounts containing terms and conditions that are not less advantageous in the aggregate than such policy with respect to matters arising on or before the Effective Time;
provided
,
however
,
that after the Effective Time, the Surviving Corporation shall not be required to pay with respect to such insurance policies in respect of any one policy year annual premiums in excess of 300% of the last annual premium paid by IMS Health prior to
the date hereof in respect of the coverage required to be obtained pursuant hereto, but in such case shall purchase as much coverage as reasonably practicable for such amount;
provided
,
further
, that if the Surviving Corporation
purchases a tail policy and the coverage thereunder costs more than 300% of such last annual premium, the Surviving Corporation shall purchase the maximum amount of coverage that can be obtained for 300% of such last annual premium. At
IMS Healths option, IMS Health may purchase, prior to the Effective Time, a six-year prepaid tail policy on terms and conditions (in both amount and scope) providing substantially equivalent benefits as the current policies of
directors and officers liability insurance and fiduciary liability insurance maintained by IMS Health and its Subsidiaries with respect to matters arising on or before the Effective Time, covering without limitation the transactions
contemplated hereby;
provided
,
however
, that such insurance policies in respect of any one policy year annual premiums shall not exceed 300% of the last annual premium paid by IMS Health prior to the date hereof. If such tail prepaid
policy has been obtained by IMS Health prior to the Effective Time, the Surviving Corporation shall cause such policy to be maintained in full force and effect, for its full term, and shall honor all obligations thereunder.
(d) Notwithstanding anything herein to the contrary, if any Action (whether arising before, at or after the Effective Time) is instituted
against any Indemnified Party on or prior to the sixth anniversary of the Effective Time, the provisions of this
Section 5.10
shall continue in effect until the final disposition of such Action.
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(e) The indemnification provided for herein shall not be deemed exclusive of any other rights to
which an Indemnified Party is entitled, whether pursuant to Law, Contract or otherwise. The provisions of this
Section 5.10
shall survive the consummation of the Merger and, notwithstanding any other provision of this Agreement that may
be to the contrary, expressly are intended to benefit, and shall be enforceable by, each of the Indemnified Parties and their respective heirs and legal representatives.
(f) In the event that the Surviving Corporation or any of its successors or assigns (i) consolidates with or merges into any other Person
and shall not be the continuing or surviving corporation or entity of such consolidation or merger or (ii) transfers or conveys all or a majority of its properties and assets to any Person, then, and in each such case, proper provision shall be
made so that the successors and assigns of the Surviving Corporation shall succeed to the obligations set forth in this
Section 5.10
.
Section 5.11
Delisting
. Each of IMS Health and Quintiles agrees to cooperate with the other party in taking, or causing to be
taken, all actions necessary to delist the IMS Health Common Stock from the NYSE and terminate its registration under the Exchange Act,
provided
, that such delisting and termination shall not be effective until after the Effective Time.
Section 5.12
Stock Exchange Listing
. Quintiles shall use its reasonable best efforts to cause the shares of Surviving Corporation
Common Stock to be issued in the Merger, and such other shares of Surviving Corporation Common Stock to be reserved for issuance in connection with the Merger, to be approved for listing on the NYSE, subject to official notice of issuance, prior to
the Effective Time.
Section 5.13
Stockholder Litigation
. Quintiles shall give IMS Health the opportunity to participate in
(but not control) the defense and settlement of any stockholder litigation against Quintiles and/or its officers or directors, and IMS Health shall give Quintiles the opportunity to participate in (but not control) the defense and settlement of any
stockholder litigation against IMS Health and/or its officers or directors, in each case relating to the Merger or any of the other transactions contemplated by this Agreement in accordance with the terms of a mutually agreed upon joint defense
agreement. Neither Quintiles nor IMS Health shall enter into any settlement agreement in respect of any stockholder litigation against it and/or its directors or officers relating to the Merger or any of the other transactions contemplated hereby
without the other partys prior written consent (such consent not to be unreasonably withheld, conditioned or delayed).
Section 5.14
Director Resignations
.
(a) IMS Health shall use its reasonable best efforts to cause to be delivered to Quintiles, at or prior to the Effective Time, the
resignations executed by each of its directors that will not be serving as directors of the Surviving Corporation effective upon the Effective Time.
(b) Quintiles shall use its reasonable best efforts to cause to be delivered to IMS Health, at or prior to the Effective Time, the
resignations executed by each of its directors that will not be serving as directors of the Surviving Corporation effective upon the Effective Time.
Section 5.15
Certain Tax Matters
. Quintiles and IMS Health each agrees to (i) not, and to not permit any of their
Subsidiaries to, take or cause to be taken any action on or before the Effective Time, which would reasonably be expected to disqualify the Merger as a reorganization within the meaning of Section 368(a) of the Code and (ii) file (and
agree to cause their respective Subsidiaries to file) all Tax Returns consistent with the treatment of the Merger as a reorganization within the meaning of Section 368(a) of the Code.
Section 5.16
Public Announcements
. Quintiles and IMS Health shall reasonably consult with each other before issuing, and give each
other a reasonable opportunity to review and comment upon, any press release, Financing Disclosure or other public statements with respect to this Agreement, the Merger and the other transactions contemplated hereby and shall not issue any such
press release, Financing Disclosure or make any
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public announcement prior to such consultation and review, except as may be required by applicable Law, court process or by obligations pursuant to any listing agreement with any national
securities exchange or national securities quotation system. The initial press release of the parties announcing the execution of this Agreement shall be a joint press release of IMS Health and Quintiles in a form that is mutually agreed.
Notwithstanding the foregoing, (a) any such press release, Financing Disclosure or public statement as may be required by Applicable Law or any listing agreement with any national securities exchange may be issued prior to such consultation if
the party making the release or statement has used its reasonable best efforts to consult with the other party, (b) the first sentence of this
Section 5.16
shall not apply with respect to a Quintiles Adverse Recommendation Change
(or any responses thereto) or an IMS Health Adverse Recommendation Change (or any responses thereto), (c) the first sentence of this
Section 5.16
shall not apply to any disclosure of information concerning this Agreement in
connection with any dispute between the parties regarding this Agreement, (d) the first sentence of this
Section 5.16
shall not apply in respect of any such content that has been previously consented to by the other party, or
otherwise exempted from this
Section 5.16
, to the extent replicated in whole or in part in any subsequent press release or other announcement, and (e) the first sentence of this
Section 5.16
shall not apply to any public
statement regarding the transactions contemplated hereby in response to questions from the press, analysts, investors or those attending industry conferences, or to internal announcements to employees, so long as such statements are not inconsistent
with previous press releases, public disclosures or public statements made jointly by the parties and otherwise in compliance with this
Section 5.16
and do not reveal material nonpublic information regarding this Agreement or the
transactions contemplated hereby. As used above,
Financing Disclosure
means any reference to, or information in connection with, the Merger and the transactions contemplated hereby that is included in any documents to be filed
with any Person (including the SEC), issued, published and/or distributed by Quintiles or IMS Health in connection with any financing transaction to be entered into by either such party.
Section 5.17
Section 16 Matters
. Prior to the Effective Time, each of IMS Health and Quintiles shall take all such steps as
may be necessary or appropriate to cause the transactions contemplated by this Agreement, including any dispositions of Quintiles Common Stock (including derivative securities with respect to such Quintiles Common Stock) or acquisitions of Surviving
Corporation Common Stock (including derivative securities with respect to such Surviving Corporation Common Stock) resulting from the transactions contemplated by this Agreement by each individual who is subject to the reporting requirements of
Section 16(a) of the Exchange Act with respect to Quintiles or will become subject to such reporting requirements with respect to the Surviving Corporation to be exempt from liability under Section 16 under the Exchange Act
Section 5.18
Financing Cooperation
. Unless the parties mutually agree not to pursue the Debt Financing, each of Quintiles and IMS
Health agrees as follows:
(a) Prior to the Closing, IMS Health shall not agree to, permit or consent to any termination, amendment,
replacement, supplement or other modification of, or waive any of its rights under, the Commitment Letter or the definitive agreements relating to the Debt Financing without the prior written consent of Quintiles (which consent shall not be
unreasonably withheld, delayed or conditioned);
provided
, that IMS Health may, without the prior written consent of Quintiles, (i) enter into any amendment, replacement, supplement or other modification to or waiver of any provision of
the Commitment Letter or the definitive agreements relating to the Debt Financing, if such amendment, replacement, supplement or other modification or waiver (A) does not reduce the aggregate principal amount of the Debt Financing,
(B) would not reasonably be expected to prevent, delay or impede in any material respect the consummation of all or a portion of the Debt Financing or the Merger and (C) does not adversely change in any material respect or impose new or
additional conditions or otherwise expand or adversely amend in any material respect any of the financing conditions from those set forth in the Commitment Letter on the date of this Agreement, in each case in a manner that would reasonably be
expected to prevent, delay or impede in any material respect the consummation of all or a portion of the Debt Financing or the Merger; and (ii) amend, replace, supplement or otherwise modify the Commitment Letter or the definitive agreements
relating to the Debt Financing (x) to add lenders, lead arrangers, book runners, syndication agents or similar entities who had not executed the Commitment Letter as of the date of this Agreement (but not make any other changes) or (y) in
respect of the implementation or exercise of any flex provisions provided in the Fee Letter.
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(b) At all times from and after the date hereof to and through the Closing Date, each of
Quintiles and IMS Health shall, and shall cause its Subsidiaries to, use commercially reasonable efforts to cause the respective officers, employees, consultants and advisors, including legal and accounting advisors, of each of Quintiles and IMS
Health and its Subsidiaries to, provide to the other party such cooperation as may be reasonably requested by Quintiles or IMS Health, as applicable, that is necessary, proper or advisable in connection with the Debt Financing and in causing the
conditions (including with respect to timeliness) set forth in the Commitment Letter and the Fee Letter to be satisfied, including:
(i) making senior management and advisors of each of Quintiles and IMS Health and each of their respective Subsidiaries
reasonably available to assist in preparation for and participate in a reasonable number of meetings, presentations, road shows, drafting sessions and due diligence sessions with the Debt Financing Sources and other proposed lenders, legal counsel,
underwriters, initial purchasers, placement agents and potential investors, and in sessions with rating agencies, subject to customary confidentiality provisions;
(ii) assisting with the preparation of pro forma financial information and pro forma financial statements and materials,
including pro forma cost savings, synergies, capitalization and other pro forma adjustments required or desirable, for rating agency presentations, offering documents, private placement memoranda, registration statements, bank information memoranda,
prospectuses, business projections and similar documents used in connection with the Debt Financing and providing customary estimates and other forward-looking financial information regarding the future performance of the business of each of
Quintiles and IMS Health and each of their respective Subsidiaries to the extent reasonably requested by the Debt Financing Sources, and providing customary authorization and management representation letters in connection therewith;
(iii) using commercially reasonable efforts to cause its independent accountants to provide such assistance and cooperation,
including participating in a reasonable number of drafting sessions and accounting due diligence sessions, assisting in the preparation of any pro forma financial statements to be included in the documents referred to in
Section 5.18(a)(ii)
, providing consents to use their audit reports relating to Quintiles or IMS Health, as the case may be, and providing any customary comfort letters, which accountants would be prepared to issue at the time
of pricing and at closing of any offering or private placement of the Debt Financing (in the form of debt securities);
(iv) assisting in the preparation of and executing and delivering definitive financing documents, including interest hedging
arrangements, guarantees, pledge and security documents, and certificates and other documents and back-up for legal opinions, in each case as applicable and to the extent reasonably requested by the other party, and otherwise reasonably facilitating
the pledging of collateral;
(v) requesting and cooperating in obtaining customary lien terminations relating to any
Indebtedness of each of Quintiles and IMS Health and its Subsidiaries;
(vi) providing reasonable access during normal
business hours by the other party and any Debt Financing Sources, and their respective officers, employees, consultants and advisors (including legal, valuation, and accounting advisors) to the books and records, properties, officers, directors,
agents and representatives of Quintiles or IMS Health, as applicable, and its Subsidiaries;
(vii) assisting with due
diligence activities relating to Quintiles or IMS Healths financial information;
(viii) furnishing to the Debt
Financing Sources all financial and other information regarding Quintiles or IMS Health, as applicable, and its Subsidiaries as may be necessary in connection with any Debt Financing and reasonably requested by Quintiles or IMS Health, as
applicable, as promptly as practicable following such request to consummate the Debt Financing, including (A) all historical financial statements, historical financial data and pro forma financial data regarding Quintiles or IMS Health, as
applicable, and its Subsidiaries, in each case (1) prepared in accordance with GAAP and (2)
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that would be required by the Securities Act (including Regulation S-K and Regulation S-X thereunder and other accounting rules and regulations of the SEC) to be included in a registration
statement to be filed with the SEC with respect to debt securities of IMS Health (as of and for the periods required thereby) (other than pursuant to Item 402(b) of Regulation S-K and Rule 3-09, Rule 3-10 or Rule 3-16 of Regulation S-X), and
(B) such information (1) that is otherwise customarily included in private placement memoranda relating to offerings under Rule 144A of the Securities Act or bank information memoranda, as applicable, in each case of the type contemplated
by the Debt Financing, and (2) as is otherwise reasonably necessary or advisable in order to receive customary comfort (including as to negative assurance comfort and change period) from Quintiles or IMS
Healths independent accountants in connection with offerings of debt securities (all such information described in
clauses (A)
and
(B)
of this
clause (viii)
, together with any replacements or restatements thereof
and any supplements thereto if any such information would go stale and, if necessary, approval of Quintiles or IMS Healths auditors to make customary use of applicable information in connection with the Debt Financing, the
Required Financial Information
);
(ix) taking all actions reasonably requested to permit the prospective
Debt Financing Sources involved in the Debt Financing to evaluate each of Quintiles and IMS Healths and each of their respective Subsidiaries assets, cash management and accounting systems, policies and procedures relating thereto
for the purpose of establishing collateral arrangements;
(x) providing at least five (5) Business Days prior to the
Closing all documentation and other information about each of Quintiles and IMS Health and each of their respective Subsidiaries required by applicable know your customer and anti-money laundering rules and regulations including the USA
Patriot Act to the extent requested at least ten (10) Business Days prior to the anticipated Closing;
(xi) obtaining
a certificate of the chief financial officer of Quintiles and/or IMS Health in substantially the form required pursuant to the Commitment Letter (including any commitment letter for any Alternative Financing) with respect to solvency matters; and
(xii) subject to the occurrence of the Closing, taking all corporate actions necessary to permit consummation of the Debt
Financing;
provided
, in each case under this
clause (a)
, that nothing herein shall require (1) such cooperation to the extent it would
unreasonably interfere in any material respect with the business or operations of Quintiles or IMS Health, as applicable, or their respective Subsidiaries, (2) the taking of any action that would conflict with or violate, (x) the certificate of
incorporation or bylaws or comparable organizational documents of Quintiles or IMS Health or their respective Subsidiaries, in each case that are not contingent upon the Effective Time or (y) any applicable Law, (3) Quintiles or any of their
respective Subsidiaries to pay any commitment or other similar fee or incur or assume any other liability or obligation under any definitive document in respect of the Debt Financing prior to the Effective Time (or, if the Debt Financing is funded
into escrow before the Effective Time, the initial funding thereof), (4) the directors or managers of Quintiles or any of its Subsidiaries, acting in such capacity, to execute, deliver or enter into or perform any agreement, certificate, document or
instrument with respect to the Debt Financing that would be effective prior to the Effective Time or (5) the officers or employees of Quintiles or its Subsidiaries to execute, deliver or enter into, or perform any agreement, document or
instrument with respect to the Debt Financing that would be effective prior to the Effective Time. Quintiles hereby consents to the use of its and its Subsidiaries logos in connection with the Debt Financing;
provided
, that such logos
are used solely in a manner that is not reasonably likely to harm or disparage Quintiles or the reputation and goodwill of Quintiles.
(c)
Quintiles shall deliver to IMS Health prior to the Closing Date, a payoff letter with respect to that certain Credit Agreement, dated as of May 12, 2015 (as the same may be amended, restated, supplemented, or otherwise modified from time to
time prior to the date hereof) by and among Quintiles OpCo, as Borrower, the lenders party thereto, J.P. Morgan Chase Bank, N.A. as Administrative Agent, Swing Line Lender and L/C Issuer, Morgan Stanley Senior Funding, Inc., as Swing Line Lender and
L/C Issuer and Barclays Bank PLC, as L/C Issuer, which payoff letter shall substantially provide (subject to customary exceptions) that, in each case,
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upon receipt of the payoff amount set forth in the applicable payoff letter (and, if applicable, providing for letters of credit or cash collateral), (x) the respective Indebtedness incurred
thereunder and related instruments shall be automatically terminated and (y) all Liens (and guarantees), if any, in connection therewith relating to the assets and properties of Quintiles or any of its Subsidiaries securing such Indebtedness,
shall be, be automatically released and terminated).
(d) Quintiles will use its commercially reasonable efforts to, and will cause its
Subsidiaries to use commercially reasonable efforts to, update any Required Financial Information (to the extent it is available) included in any offering document to be used in connection with the Debt Financing or offering of securities in
connection with the Debt Financing to the extent that such Required Financial Information would, when taken as a whole in the absence of such an update, contain untrue statements of material fact or omit to state any material fact necessary in order
to make the statements contained therein not misleading. In addition, if IMS Health reasonably requests Quintiles to file a Current Report on Form 8-K pursuant to the Exchange Act that contains material non-public information with respect to
Quintiles, which IMS Health reasonably determines to include in a customary offering memorandum for the Debt Financing, then Quintiles shall file a Current Report on Form 8-K or similar document containing such material non-public information.
(e) IMS Health, in its reasonable discretion, shall be permitted to obtain alternative financing from another source (the
Alternative
Financing
) than those contained in the Commitment Letter and the Fee Letter that the Alternative Financing would replace, on terms that, unless otherwise consented to by Quintiles, (i) not materially less favorable, taken as a whole
(taking into account any flex provisions), to Surviving Corporation than the terms contained in the Commitment Letter, and (ii) would not reasonably be expected to prevent, delay or impede in any material respect the consummation of the Merger.
ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1
Conditions to Each Partys Obligation to Effect the Merger
. The obligation of each party to effect the Merger is
subject to the satisfaction at or prior to the Effective Time of the following conditions:
(a)
Stockholder Approval
. The Quintiles
Stockholder Approval and the IMS Health Stockholder Approval shall have each been obtained.
(b)
Regulatory Approvals
. (i) Any
applicable waiting period (or extension thereof) relating to the Merger under the HSR Act shall have expired or been terminated and (ii) any applicable waiting period (or extension thereof) or approval relating to the Merger that is required
under any Antitrust Law (other than the HSR Act) prior to Closing, including such approvals set forth in
Section 6.1(b)
of the IMS Health Disclosure Letter, shall have expired, been terminated, or approval shall have been obtained or
waived and shall be in full force and effect at the Closing, as the case may be.
(c)
No Injunctions or Legal Restraints;
Illegality
. No temporary restraining order, preliminary or permanent injunction or other judgment, order or decree issued by any court of competent jurisdiction or other legal restraint or prohibition shall be in effect, and no Law shall have
been enacted, entered, promulgated, enforced or deemed applicable by any Governmental Entity that, in any such case, prohibits or makes illegal the consummation of the Merger.
(d)
NYSE Listing
. The shares of Surviving Corporation Common Stock issuable to the stockholders of IMS Health and to holders of IMS
Health Options, IMS Health RSUs, IMS Health Restricted Stock and IMS Health SARs as provided for in Article II shall have been approved for listing on the NYSE, subject to official notice of issuance.
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(e)
Form S-4
. The Form S-4 shall have been declared effective by the SEC under the
Securities Act and no stop order suspending the effectiveness of the Form S-4 shall have been issued and no proceedings for that purpose shall have been initiated or threatened.
(f)
Stockholder Arrangements
. The Stockholder Arrangements shall be in full force and effect.
(g)
Conversion
. The Conversion Effective Time shall have occurred.
Section 6.2
Conditions to the Obligations of Quintiles
. The obligation of Quintiles to effect the Merger is also subject to the
satisfaction, or waiver by Quintiles, at or prior to the Effective Time of the following conditions:
(a)
Representations and
Warranties
. (i) Each of the representations and warranties of IMS Health set forth in Section 3.1, Section 3.2(b), Section 3.4 and Section 3.23 shall be true and correct in all material respects as of the date of this
Agreement and as of the Closing Date as if made as of the Closing Date (except to the extent such representations and warranties expressly relate to an earlier date, in which case as of such earlier date); (ii) each of the representations and
warranties of IMS Health set forth in Section 3.2(a) and Section 3.9(a) shall be true and correct as of the date of this Agreement and as of the Closing Date, as if made on the Closing Date (except to the extent such representations and
warranties expressly relate to an earlier date, in which case as of such earlier date), except, in the case of the representations and warranties of IMS Health set forth in Section 3.2(a), for breaches of such representations and warranties
which are
de minimis
in the aggregate; and (iii) each of the remaining representations and warranties of IMS Health set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date as
though made as of the Closing Date (except to the extent such representations and warranties expressly relate to an earlier date, in which case as of such earlier date), except for inaccuracies of representations or warranties the circumstances
giving rise to which, individually or in the aggregate, have not had or would not reasonably be expected to have an IMS Health Material Adverse Effect (it being understood that, for purposes of determining the accuracy of such representations and
warranties, all materiality and IMS Health Material Adverse Effect qualifications and exceptions contained in such representations and warranties shall be disregarded).
(b)
Performance of Obligations of IMS Health
. IMS Health shall have performed in all material respects all obligations required to be
performed by it under this Agreement at or prior to the Effective Time.
(c)
Absence of Material Adverse Effect
. Since the date of
this Agreement there shall not have occurred any event, change, circumstance, occurrence, effect or state of facts that, individually on in the aggregate, has had or would reasonably be expected to have an IMS Health Material Adverse Effect.
(d)
Officers Certificate
. Quintiles shall have received a certificate signed by an executive officer of IMS Health certifying as
to the matters set forth in
Section 6.2(a)
,
Section 6.2(b)
and
Section 6.2(c)
.
(e)
Tax
Opinion
. Quintiles shall have received an opinion from Bryan Cave LLP, counsel to Quintiles, to the effect that, on the basis of the facts, representations and assumptions set forth in such opinion, for federal income tax purposes the Merger
will qualify as a reorganization under Section 368(a) of the Code. In rendering such opinion, Bryan Cave LLP may rely upon representations contained in certificates of Quintiles and IMS Health, which certificates shall be effective
as of the date of such tax opinion, and the parties hereto agree to provide Bryan Cave LLP with such certificates as it may reasonably request in connection with rendering its opinion.
Section 6.3
Conditions to the Obligations of IMS Health
. The obligation of IMS Health to effect the Merger is also subject to the
satisfaction, or waiver by IMS Health, at or prior to the Effective Time of the following conditions:
(a)
Representations and
Warranties
. (i) Each of the representations and warranties of Quintiles set forth in Section 4.1, Section 4.2(b), Section 4.4 and Section 4.23 shall be true and correct in all material respects as of
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the date of this Agreement and as of the Closing Date as if made as of the Closing Date (except to the extent such representations and warranties expressly relate to an earlier date, in which
case as of such earlier date); (ii) each of the representations and warranties of Quintiles set forth in Section 4.2(a) and Section 4.9(a) shall be true and correct as of the date of this Agreement and as of the Closing Date, as if made on
the Closing Date (except to the extent such representations and warranties expressly relate to an earlier date, in which case as of such earlier date), except, in the case of the representations and warranties of Quintiles set forth in
Section 4.2(a), for breaches of such representations and warranties which are
de minimis
in the aggregate; and (iii) each of the remaining representations and warranties of Quintiles set forth in this Agreement shall be true and
correct as of the date of this Agreement and as of the Closing Date as though made as of the Closing Date (except to the extent such representations and warranties expressly relate to an earlier date, in which case as of such earlier date), except
for inaccuracies of representations or warranties the circumstances giving rise to which, individually or in the aggregate, have not had or would not reasonably be expected to have a Quintiles Material Adverse Effect (it being understood that, for
purposes of determining the accuracy of such representations and warranties, all materiality and Quintiles Material Adverse Effect qualifications and exceptions contained in such representations and warranties shall be disregarded).
(b)
Performance of Obligations of Quintiles
. Quintiles shall have performed in all material respects all obligations required to be
performed by it under this Agreement at or prior to the Effective Time.
(c)
Absence of Material Adverse Effect
. Since the date of
this Agreement there shall not have occurred any event, change, circumstance, occurrence, effect or state of facts that, individually on in the aggregate, has had or would reasonably be expected to have a Quintiles Material Adverse Effect.
(d)
Officers Certificate
. IMS Health shall have received a certificate signed by an executive officer of Quintiles certifying as
to the matters set forth in
Section 6.3(a)
,
Section 6.3(b)
and
Section 6.3(c)
.
(e)
Tax
Opinion
. IMS Health shall have received an opinion from Weil, Gotshal & Manges LLP, counsel to IMS Health, to the effect that, on the basis of the facts, representations and assumptions set forth in such opinion, for federal income tax
purposes the Merger will qualify as a reorganization under Section 368(a) of the Code. In rendering such opinion, Weil, Gotshal & Manges LLP may rely upon representations contained in certificates of IMS Health and
Quintiles, which certificates shall be effective as of the date of such tax opinion, and the parties hereto agree to provide Weil, Gotshal & Manges LLP with such certificates as it may reasonably request in connection with rendering its
opinion.
Section 6.4
Frustration of Closing Conditions
. Neither Quintiles nor IMS Health may rely on the failure of any
condition set forth in this Article VI to be satisfied if such failure was caused by such partys breach of this Agreement.
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
Section 7.1
Termination
. This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time,
whether before or after the Quintiles Stockholder Approval or the IMS Health Stockholder Approval has been obtained:
(a) by mutual written
consent of Quintiles and IMS Health;
(b) by either Quintiles or IMS Health:
(i) if the Merger shall not have been consummated on or before March 31, 2017 (the
Outside Date
);
provided
, that the right to terminate this Agreement pursuant to this
Section 7.1(b)(i)
shall not
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be available to any party whose failure to fulfill in any material respect any of its obligations under this Agreement has been the primary cause of, or the primary factor that resulted in, the
failure of the Merger to be consummated by the Outside Date;
(ii) if any court or other Governmental Entity of competent
jurisdiction shall have issued a judgment, order, injunction, rule or decree, or taken any other action restraining, enjoining or otherwise prohibiting any of the transactions contemplated by this Agreement and such judgment, order, injunction,
rule, decree or other action shall have become final and nonappealable;
provided
, that the party seeking to terminate this Agreement pursuant to this
Section 7.1(b)(ii)
shall have used its reasonable best efforts to contest,
appeal and remove such judgment, order, injunction, rule, decree, ruling or other action in accordance with
Section 5.6
;
(iii) if the Quintiles Stockholder Approval shall not have been obtained at the Quintiles Stockholders Meeting duly convened
therefor or at any adjournment or postponement thereof at which a vote on the approval of this Agreement was taken;
provided
, that Quintiles shall not be permitted to terminate this Agreement pursuant to this
Section 7.1(b)(iii)
if the failure to obtain such Quintiles Stockholder Approval is primarily caused by any action or failure to act of Quintiles that constitutes a breach of this Agreement; or
(iv) if the IMS Health Stockholder Approval shall not have been obtained at the IMS Health Stockholders Meeting duly convened
therefor or at any adjournment or postponement thereof at which a vote on the approval of this Agreement was taken;
provided
, that IMS Health shall not be permitted to terminate this Agreement pursuant to this
Section 7.1(b)(iv)
if the failure to obtain such IMS Health Stockholder Approval is primarily caused by any action or failure to act of IMS Health that constitutes a breach of this Agreement;
(c) by IMS Health:
(i) if Quintiles shall have breached or failed to perform any of its representations, warranties, covenants or agreements set
forth in this Agreement (other than with respect to a breach of
Section 5.2
or
Section 5.4(c)
, as to which
Section 7.1(c)(ii)(D)
will apply), or if any representation or warranty of Quintiles shall have become untrue, which
breach or failure to perform or to be true, either individually or in the aggregate, if occurring or continuing at the Effective Time (A) would result in the failure of any of the conditions set forth in
Section 6.1
or
Section 6.3
and (B) cannot be or has not been cured by the earlier of (1) the Outside Date and (2) thirty (30) days after the giving of written notice to Quintiles of such breach or failure;
provided
, that IMS
Health shall not have the right to terminate this Agreement pursuant to this
Section 7.1(c)(i)
if IMS Health is then in material breach of any of its covenants or agreements set forth in this Agreement such that
Section 6.2(a)
or
Section 6.2(b)
would not be satisfied;
(ii) at any time prior to obtaining the
Quintiles Stockholder Approval, if (A) a Quintiles Adverse Recommendation Change shall have occurred, (B) Quintiles shall, within ten (10) Business Days of a tender or exchange offer relating to securities of Quintiles having been
commenced (or, if earlier, prior to the date of the Quintiles Stockholders Meeting), fail to publicly recommend against such tender or exchange offer, (C) Quintiles shall have failed to publicly reaffirm the Quintiles Recommendation within ten
(10) Business Days after the date any Acquisition Proposal or any material modification thereto is first commenced, publicly announced, distributed or disseminated to Quintiles stockholders (or, if earlier, prior to the date of the
Quintiles Stockholders Meeting) upon a request to do so by IMS Health (it being agreed that IMS Health may make only one (1) such request with respect to any such Acquisition Proposal and each material modification thereto), (D) Quintiles
shall have breached or failed to perform in any material respect any of its obligations set forth in
Section 5.2
or
Section 5.4(c)
, or (E) Quintiles or the Quintiles Board (or any committee thereof) shall have formally
resolved or publicly authorized or proposed to take any of the foregoing actions; or
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(iii) at any time prior to the receipt of the IMS Health Stockholder Approval, if
the IMS Health Board shall have (A) effected an IMS Health Adverse Recommendation Change in accordance with
Section 5.3(b)
in respect of a Superior Proposal, (B) entered into a definitive agreement with respect to such Superior
Proposal concurrently with the termination of this Agreement in accordance with this
Section 7.1(c)(iii)
and (C) paid the IMS Health Termination Fee to Quintiles in accordance with
Section 7.3(c)(iii)
;
(d) by Quintiles:
(i) if IMS Health shall have breached or failed to perform any of its representations, warranties, covenants or agreements set
forth in this Agreement (other than with respect to a breach of
Section 5.3
or
Section 5.4(d)
, as to which
Section 7.1(d)(ii)(D)
will apply), or if any representation or warranty of IMS Health shall have become
untrue, which breach or failure to perform or to be true, either individually or in the aggregate, if occurring or continuing at the Effective Time (A) would result in the failure of any of the conditions set forth in
Section 6.1
or
Section 6.2
and (B) cannot be or has not been cured by the earlier of (1) the Outside Date and (2) thirty (30) days after the giving of written notice to IMS Health of such breach or failure;
provided
, that
Quintiles shall not have the right to terminate this Agreement pursuant to this
Section 7.1(d)(i)
if Quintiles is then in material breach of any of its covenants or agreements set forth in this Agreement such that
Section 6.3(a)
or
Section 6.3(b)
would not be satisfied;
(ii) at any time prior to obtaining the
IMS Health Stockholder Approval, if (A) an IMS Health Adverse Recommendation Change shall have occurred, (B) IMS Health shall, within ten (10) Business Days of a tender or exchange offer relating to securities of IMS Health having
been commenced (or, if earlier, prior to the date of the IMS Health Stockholders Meeting), fail to publicly recommend against such tender or exchange offer, (C) IMS Health shall have failed to publicly reaffirm the IMS Health Recommendation
within ten (10) Business Days after the date any Acquisition Proposal or any material modification thereto is first commenced, publicly announced, distributed or disseminated to IMS Healths stockholders (or, if earlier, prior to the date
of the IMS Health Stockholders Meeting) upon a request to do so by Quintiles (it being agreed that Quintiles may make only one (1) such request with respect to any such Acquisition Proposal and each material modification thereto), (D) IMS
Health shall have breached or failed to perform in any material respect any of its obligations set forth in
Section 5.3
or
Section 5.4(d)
, or (E) IMS Health or the IMS Health Board (or any committee thereof) shall have
formally resolved or publicly authorized or proposed to take any of the foregoing actions; or
(iii) at any time prior to
the receipt of the Quintiles Stockholder Approval, if the Quintiles Board shall have (A) effected a Quintiles Adverse Recommendation Change in accordance with
Section 5.2(b)
in respect of a Superior Proposal, (B) entered into a
definitive agreement with respect to such Superior Proposal concurrently with the termination of this Agreement in accordance with this
Section 7.1(d)(iii)
and (C) paid the Quintiles Termination Fee to IMS Health in accordance with
Section 7.3(b)(iii)
.
The party desiring to terminate this Agreement pursuant to this
Section 7.1
(other than
pursuant to
Section 7.1(a)
) shall give written notice of such termination to the other party.
Section 7.2
Effect of
Termination
. In the event of termination of the Agreement, this Agreement shall immediately become void and have no effect, without any liability or obligation on the part of Quintiles or IMS Health,
provided
, that:
(a) the Confidentiality Agreement (as amended hereby) and the provisions of
Sections 3.23
and
4.23
(Brokers),
Section 5.16
(Public Announcements), this
Section 7.2
,
Section 7.3
(Fees and Expenses) and Article VIII shall survive the termination hereof;
(b) either Quintiles or IMS Health may have liability as provided in
Section 7.3
; and
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(c) no such termination shall relieve any party from any liability or damages resulting from a
Willful Breach of any of its representations, warranties, covenants or agreements set forth in this Agreement or fraud, in which case the non-breaching party shall be entitled to all rights and remedies available at law or in equity.
Section 7.3
Fees and Expenses
.
(a) Except as otherwise provided in this
Section 7.3
, all fees and expenses incurred in connection with this Agreement, the Merger and
the other transactions contemplated hereby shall be paid by the party incurring such fees or expenses, whether or not the Merger is consummated, except that the expenses incurred in connection with the filing, printing and mailing of the Form S-4,
the Joint Proxy Statement/Prospectus, and all filing and other fees paid to the SEC, in each case in connection with the Merger (other than attorneys fees, accountants fees and related expenses), shall be shared equally by Quintiles and
IMS Health.
(b)
Quintiles Termination Fee
. In the event that:
(i) (A) following the date of this Agreement and prior to the termination of this Agreement, an Acquisition Proposal (whether
or not conditional) is made directly to Quintiles stockholders or is otherwise publicly disclosed or otherwise communicated to the Quintiles Board, (B) this Agreement is terminated by Quintiles or IMS Health pursuant to
Section 7.1(b)(i)
(unless the termination is by IMS Health and Quintiles would have been entitled to terminate this Agreement pursuant to
Section 7.1(d)(i)
but for such termination pursuant to
Section 7.1(b)(i)
)
or
Section 7.1(b)(iii)
or by IMS Health pursuant to
Section 7.1(c)(i)
, and (C) within twelve (12) months after the date of such termination, Quintiles enters into a definitive agreement in respect of any Acquisition
Proposal, or recommends or submits an Acquisition Proposal to its stockholders for approval, and a transaction in respect of any such any such Acquisition Proposal is thereafter consummated, which, in each case, need not be the same Acquisition
Proposal that was made, disclosed or communicated prior to termination hereof (
provided
, that for purposes of this clause (C), each reference to 15% in the definition of Acquisition Proposal shall be deemed to be a
reference to 50%);
(ii) this Agreement is terminated by IMS Health pursuant to
Section 7.1(c)(ii)
;
or
(iii) this Agreement is terminated by Quintiles pursuant to
Section 7.1(d)(iii)
;
then, in any such event, Quintiles shall pay to IMS Health a fee of $250,000,000 (the
Quintiles Termination Fee
), it being
understood that in no event shall Quintiles be required to pay the Quintiles Termination Fee on more than one occasion;
provided
, that the payment by Quintiles of the Quintiles Termination Fee pursuant to this
Section 7.3
shall
not relieve Quintiles from any liability or damage resulting from a Willful Breach of any of its representations, warranties, covenants or agreements set forth in this Agreement or fraud.
(iv) If either IMS Health or Quintiles terminates this Agreement pursuant to
Section 7.1(b)(iii)
or IMS Health
terminates this Agreement pursuant to
Section 7.1(c)(i)
, Quintiles shall pay or cause to be paid to IMS Health any and all out-of-pocket fees and expenses (including fees and expenses of financial advisors, outside legal counsel,
accountants, experts, consultants and other Representatives) actually incurred by IMS Health or on its behalf in connection with or related to the authorization, preparation, investigation, negotiation, execution and performance of this Agreement
and the transactions contemplated hereby (the
IMS Health Expenses
), up to a maximum amount of $15,000,000;
provided
, that the payment by Quintiles of the IMS Health Expenses pursuant to this
Section 7.3(b)(iv)
shall not relieve Quintiles of any subsequent obligation to pay the Quintiles Termination Fee pursuant to
Section 7.3(b)(i)
except to the extent indicated in such section, and (ii) shall not relieve Quintiles from any liability for
damages resulting from a Willful Breach of any of its representations, warranties, covenants or agreements set forth in this Agreement or fraud. The IMS Health Expenses shall be paid by Quintiles within three (3) Business Days of such
termination by wire transfer of same day funds to the account designated by IMS Health. To the extent a Quintiles
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Termination Fee becomes payable, any payment previously made pursuant to this
Section 7.3(b)(iv)
shall be credited against such obligation of Quintiles to pay the Quintiles
Termination Fee.
(c)
IMS Health Termination Fee
. In the event that:
(i) (A) following the date of this Agreement and prior to the termination of this Agreement, an Acquisition Proposal (whether
or not conditional) is made directly to IMS Healths stockholders or is otherwise publicly disclosed or otherwise communicated to the IMS Health Board, (B) this Agreement is terminated by IMS Health or Quintiles pursuant to
Section 7.1(b)(i)
(unless the termination is by Quintiles and IMS Health would have been entitled to terminate this Agreement pursuant to
Section 7.1(c)(i)
but for such termination pursuant to
Section 7.1(b)(i)
)
or
Section 7.1(b)(iv)
or by Quintiles pursuant to
Section 7.1(d)(i)
, and (C) within twelve (12) months after the date of such termination, IMS Health enters into a definitive agreement in respect of any Acquisition
Proposal, or recommends or submits an Acquisition Proposal to its stockholders for adoption, and a transaction in respect of any such any such Acquisition Proposal is thereafter consummated, which, in each case, need not be the same Acquisition
Proposal that was made, disclosed or communicated prior to termination hereof (
provided
, that for purposes of this clause (C), each reference to 15% in the definition of Acquisition Proposal shall be deemed to be a
reference to 50%);
(ii) this Agreement is terminated by Quintiles pursuant to
Section 7.1(d)(ii)
;
or
(iii) this Agreement is terminated by IMS Health pursuant to
Section 7.1(c)(iii)
;
then, in any such event, IMS Health shall pay to Quintiles a fee of $250,000,000 (the
IMS Health Termination Fee
), it being
understood that in no event shall IMS Health be required to pay the IMS Health Termination Fee on more than one occasion;
provided
, that the payment by IMS Health of the IMS Health Termination Fee pursuant to
Section 7.3
shall not
relieve IMS Health from any liability or damage resulting from a Willful Breach of any of its representations, warranties, covenants or agreements set forth in this Agreement or fraud.
(iv) If either IMS Health or Quintiles terminates this Agreement pursuant to
Section 7.1(b)(iv)
or Quintiles terminates
this Agreement pursuant to
Section 7.1(d)(i)
, IMS Health shall pay or cause to be paid to Quintiles any and all out-of-pocket fees and expenses (including fees and expenses of financial advisors, outside legal counsel, accountants, experts,
consultants and other Representatives) actually incurred by Quintiles or on its behalf in connection with or related to the authorization, preparation, investigation, negotiation, execution and performance of this Agreement and the transactions
contemplated hereby (the
Quintiles Expenses
), up to a maximum amount of $15,000,000;
provided
, that the payment by the IMS Health of the Quintiles Expenses pursuant to this
Section 7.3(c)(iv)
shall not relieve
IMS Health of any subsequent obligation to pay the IMS Health Termination Fee pursuant to
Section 7.3(c)(i)
except to the extent indicated in such section, and (ii) shall not relieve IMS Health from any liability for damages
resulting from a Willful Breach of any of its representations, warranties, covenants or agreements set forth in this Agreement or fraud. The Quintiles Expenses shall be paid by IMS Health within three (3) Business Days of such termination by
wire transfer of same day funds to the account designated by Quintiles. To the extent an IMS Health Termination Fee becomes payable, any payment previously made pursuant to this
Section 7.3(c)(iv)
shall be credited against such
obligation of IMS Health to pay the IMS Health Termination Fee.
(d) Payment of the Quintiles Termination Fee or IMS Health Termination
Fee shall be made by wire transfer of same day funds to the accounts designated by IMS Health or Quintiles, respectively, (i) prior to or concurrently with the consummation of a transaction contemplated by an Acquisition Proposal, in the case
of a Quintiles Termination Fee payable pursuant to
Section 7.3(b)(i)
or an IMS Health Termination Fee payable pursuant to
Section 7.3(c)(i)
, (ii) as promptly as reasonably practicable after termination (and, in any
event, within two (2) Business Days thereof), in the case of termination by IMS Health pursuant to
Section 7.1(c)(ii)
or by Quintiles pursuant to
Section 7.1(d)(ii)
or (iii) concurrently with such termination in the
case of termination by IMS Health pursuant to
Section 7.1(c)(iii)
or by Quintiles pursuant to
Section 7.1(d)(iii)
.
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(e) Each of Quintiles and IMS Health acknowledges that the agreements contained in this
Section 7.3
are an integral part of the transactions contemplated by this Agreement, and that, without these agreements, neither Quintiles nor IMS Health would enter into this Agreement. Accordingly, if any party fails promptly to pay
any amounts due pursuant to this
Section 7.3
, and, in order to obtain such payment, the other party commences a suit that results in a judgment against the first party for the amounts set forth in this
Section 7.3
, the first
party shall pay to the other party its costs and expenses (including reasonable attorneys fees and expenses) in connection with such suit, together with interest on the amounts due pursuant to this
Section 7.3
from the date such
payment was required to be made until the date of payment at the prime lending rate as published in The Wall Street Journal in effect on the date such payment was required to be made. Each of the Quintiles Termination Fee, the IMS Health Termination
Fee, the Quintiles Expenses and the IMS Health Expenses is non-refundable and, except as set forth herein, shall not be set off by or credited against any other payment.
(f) Upon termination of this Agreement in accordance with its terms, IMS Healths right, if any, to receive the Quintiles Termination Fee
or the IMS Health Expenses pursuant to
Section 7.3(b)
, and Quintiles right, if any, to receive the IMS Health Termination Fee or the Quintiles Expenses pursuant to
Section 7.3(c)
, and the amounts described in
Section 7.3(a)
and
Section 7.3(e)
, shall be the sole and exclusive remedy of IMS Health or Quintiles, as the case may be, and their respective Affiliates against the parties and their respective former, current or future
stockholders, directors, officers, Affiliates, agents or other Representatives for any loss suffered as a result of any breach of any representation, warranty, covenant or agreement in this Agreement or the failure of the Merger or the other
transactions contemplated by this Agreement to be consummated, and upon payment of such Quintiles Termination Fee or IMS Health Termination Fee, as the case may be, and any applicable amount described in
Section 7.3(a)
and
Section 7.3(e)
, none of the parties or any of their respective former, current or future stockholders, directors, officers, Affiliates, agents or other Representatives shall have any further liability or obligation relating to or arising
out of this Agreement or the Merger or the other transactions contemplated by this Agreement;
provided
, that, nothing in this
Section 7.3(f)
shall relieve any party from any liability or damage resulting from a Willful Breach of
any of its representations, warranties, covenants or agreements set forth in this Agreement or fraud.
Section 7.4
Amendment or
Supplement
. This Agreement may be amended, modified or supplemented by the parties by action taken or authorized by their respective Boards of Directors at any time prior to the Effective Time, whether before or after the Quintiles Stockholder
Approval or the IMS Health Stockholder Approval has been obtained;
provided
,
however
, that after the Quintiles Stockholder Approval has been obtained, no amendment shall be made that pursuant to applicable Law requires further approval
or adoption by the stockholders of Quintiles without such further approval or adoption;
provided
,
further
, that after the IMS Health Stockholder Approval has been obtained, no amendment shall be made that pursuant to applicable Law
requires further approval or adoption by the stockholders of IMS Health without such further approval or adoption. This Agreement may not be amended, modified or supplemented in any manner, whether by course of conduct or otherwise, except by an
instrument in writing specifically designated as an amendment hereto, signed on behalf of each of the parties in interest at the time of the amendment. In the event that any party seeks an amendment to or waiver of
Sections 7.4
(Amendment or
Supplement),
8.6
(No Third Party Beneficiaries),
8.8
(Submission to Jurisdiction) or
8.12
(Waiver of Jury Trial) that is adverse to the Debt Financing Sources, the prior written consent of the Debt Financing Sources shall be
required before any such amendment or waiver may become effective.
Section 7.5
Extension of Time; Waiver
. At any time prior
to the Effective Time, the parties may, by action taken or authorized by their respective Boards of Directors, to the extent permitted by applicable Law, (a) extend the time for the performance of any of the obligations or acts of the other
parties, (b) waive any inaccuracies in the representations and warranties of the other parties set forth in this Agreement or any document delivered pursuant hereto or (c) subject to applicable Law, waive compliance with any of the
agreements or conditions of the other parties contained herein;
provided
,
however
, that after the Quintiles Stockholder Approval has been obtained, no waiver may be made that pursuant to applicable Law requires further approval or
adoption by the stockholders of Quintiles without such further approval or adoption;
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provided
,
further
, that after the IMS Health Stockholder Approval has been obtained, no waiver may be made that pursuant to applicable Law requires further approval or adoption by
the stockholders of IMS Health without such further approval or adoption. Any agreement on the part of a party to any such waiver shall be valid only if set forth in a written instrument executed and delivered by a duly authorized officer on behalf
of such party. No failure or delay of any party in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to
enforce such right or power, or any course of conduct, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the parties hereunder are cumulative and are not exclusive of any rights or
remedies which they would otherwise have hereunder.
ARTICLE VIII
GENERAL PROVISIONS
Section 8.1
Nonsurvival of Representations and Warranties
. None of the representations, warranties, covenants or agreements in
this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Effective Time, other than those covenants or agreements of the parties which by their terms apply, or are to be performed in whole or in part, after the
Effective Time.
Section 8.2
Notices
. All notices and other communications hereunder shall be in writing and shall be deemed
duly given (a) on the date of delivery if delivered personally, or if by facsimile or e-mail, upon written confirmation of receipt by facsimile, e-mail or otherwise, (b) on the first Business Day following the date of dispatch if delivered
utilizing a next-day service by a recognized next-day courier or (c) on the earlier of confirmed receipt or the fifth Business Day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage
prepaid. All notices hereunder shall be delivered to the addresses set forth below, or pursuant to such other instructions as may be designated in writing by the party to receive such notice:
Quintiles Transnational Holdings Inc.
4820 Emperor Blvd.
Durham, North
Carolina 27703
Attention: James H. Erlinger III
Facsimile: (919) 948-4038
E-mail: James.Erlinger@quintiles.com
with a copy (which shall not constitute notice) to:
Bryan Cave LLP
One Metropolitan
Square
211 North Broadway, Suite 3600
St. Louis, Missouri 63102
Attention: William F. Seabaugh
Attention: James M. Attonito
Facsimile: (314) 259-2020
E-mail: wfseabaugh@bryancave.com
E-mail: james.attonito@bryancave.com
|
(ii)
|
if to IMS Health, to:
|
IMS Health Holdings, Inc.
83 Wooster Heights Road
Danbury,
Connecticut 06810
Attn: General Counsel
Fax: (203) 448-4690
Email:
buscon@imshealth.com
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with a copy (which shall not constitute notice) to:
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New
York 10153
Attention: Michael J. Aiello
Attention: Matthew J. Gilroy
Facsimile: (212) 310-8007
E-mail: michael.aiello@weil.com
E-mail: matthew.gilroy@weil.com
Section 8.3
Certain Definitions
. For purposes of this Agreement:
(a)
Action
means any action, suit, claim, arbitration, investigation, inquiry, audit, examination, grievance or other
proceeding by or before a Governmental Entity.
(b)
Affiliate
of any Person means any other Person that directly or
indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first Person.
(c)
Antitrust Laws
means the Sherman Act, as amended, the Clayton Act, as amended, the HSR Act, the Federal Trade Commission Act, as amended, and all other Laws that are designed or intended to prohibit, restrict or regulate actions
having the purpose or effect of monopolization or restraint of trade or lessening of competition through merger or acquisition.
(d)
Business Day
means any day other than a Saturday, a Sunday or a day on which banks in New York, New York are authorized or required by applicable Law to be closed.
(e)
Commitment Letter
means an executed debt financing commitment letter, dated as of the date of this Agreement (as
amended, restated, amended and restated, modified, supplemented, replaced or extended from time to time after the date of this Agreement, in compliance with
Section 5.18
from the Lenders).
(f)
Contract
means any bond, debenture, note, mortgage, indenture, guarantee, license, lease, purchase or sale order or
other contract, commitment, agreement, instrument, obligation, arrangement, understanding, undertaking, permit, concession or franchise, whether oral or written.
(g)
control
(including the terms controlled, controlled by and under common control
with) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
(h)
Conversion Effective Time
means the Conversion Effective Time (as defined in the Plan of Conversion).
(i)
Debt Financing
means the debt financing contemplated by the Commitment Letter together with any Alternative Financing.
(j)
Debt Financing Sources
shall mean the entities that are expected to provide, purchase or arrange all or any part
of the Debt Financing, the Alternative Financing or other financings in connection with the transactions contemplated hereby and the parties to any joinder agreements entered into pursuant thereto or relating thereto, together with their respective
Affiliates, and their respective Affiliates officers, directors, employees, agents, equity holders and representatives and their respective successors and assigns.
(k)
Environmental Law
means any Law relating to (i) the protection, preservation or restoration of the environment
(including air, surface water, groundwater, drinking water supply, surface and subsurface soils
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and strata, wetlands, plant and animal life or any other natural resource) or (ii) the exposure to, or the use, storage, recycling, treatment, generation, transportation, processing,
handling, labeling, production, release or disposal of Hazardous Substances;
provided
,
however
, that Environmental Laws shall not include healthcare Laws.
(l)
ERISA
means the Employee Retirement Income Security Act of 1974, as amended.
(m)
Exchange Act
means the Securities Exchange Act of 1934, as amended.
(n)
FCPA
means the Foreign Corrupt Practices Act of 1977.
(o)
Fee Letter
means the fee letter referred to in the Commitment Letter (as amended, restated, amended and restated,
modified, supplemented, replaced or extended from time to time after the date of this Agreement in compliance with Section 5.18).
(p)
GAAP
means generally accepted accounting principles in the United States.
(q)
Governmental Entity
means any federal, state, local or foreign government or subdivision thereof or any other
governmental, administrative, judicial, arbitral, legislative, executive, regulatory or self-regulatory authority, instrumentality, agency, commission or body.
(r)
Hazardous Substance
means any substance listed, defined, designated, classified or regulated as a waste, pollutant or
contaminant or as hazardous, toxic, radioactive or dangerous or any other term of similar import under any Environmental Law, including but not limited to petroleum.
(s)
HSR Act
means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.
(t)
IMS Health Equity Plans
means the IMS Health 2014 Incentive and Stock Award Plan and the IMS Health 2010 Equity
Incentive Plan.
(u)
IMS Health Material Adverse Effect
means any Effect that (i) is or would reasonably be
expected to be materially adverse to the business, assets, liabilities, financial condition or results of operations of IMS Health and its Subsidiaries, taken as a whole or (ii) materially impairs the ability of IMS Health to consummate, or
prevents or materially delays, the Merger or any of the other transactions contemplated by this Agreement or would reasonably be expected to do so, other than any Effect arising out of or resulting from (A) changes in general economic,
financial market, business or geopolitical conditions, (B) the conditions or general changes or developments in any of the industries in which Quintiles or its Subsidiaries operate, (C) any hurricane, tornado, flood, earthquake or other
natural disasters or calamities, (D) any adoption, implementation, promulgation, repeal, modification, amendment, reinterpretation, proposal or change in any applicable Laws or applicable accounting regulations or principles or interpretations
thereof, (E) any changes in the market price or trading volume of IMS Health Common Stock, in and of itself (provided, the facts or occurrences giving rise to or contributing to such change that are not otherwise excluded from the definition of
IMS Health Material Adverse Effect may be taken into account in determining whether there has been an IMS Health Material Adverse Effect), (F) any failure by IMS Health to meet internal or published projections, forecasts or revenue
or earnings predictions, in and of itself (provided, that the facts or occurrences giving rise to or contributing to such failure that are not otherwise excluded from the definition of IMS Health Material Adverse Effect may be taken into
account in determining whether there has been an IMS Health Material Adverse Effect), (G) any outbreak or escalation of hostilities, geopolitical conditions or any acts of war or terrorism, (H) the announcement of, or compliance with the
terms of, this Agreement and the transactions contemplated hereby, including the initiation of litigation by any Person with respect to this Agreement, and including any termination of, reduction in or similar negative impact on relationships,
contractual or otherwise, with any customers, suppliers, distributors, partners or employees of IMS Health and its Subsidiaries due to the announcement and performance of this
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Agreement or the identity of the parties to this Agreement or (I) any actions taken (or not taken) at the request of Quintiles;
provided
,
however
,
that any Effect
referred to in clauses (A), (B), (C), (D) and (G) immediately above shall be taken into account in determining whether an IMS Health Material Adverse Effect has occurred or would reasonably be expected to occur to the extent that such
Effect has had a disproportionate effect on IMS Health and its Subsidiaries, taken as a whole, as compared to other participants in the industries in which IMS Health or its Subsidiaries operate.
(v)
IMS Health Registration and Preemptive Rights Agreement
means that certain Registration and Preemptive Rights
Agreement, dated as of February 26, 2010, by and among IMS Health and each of the managers and manager designees named therein, as amended.
(w)
IMS Health Shareholders Agreement
means that certain Amended and Restated Shareholders Agreement, dated
April 9, 2014, by and among IMS Health and the stockholders identified therein.
(x)
Indebtedness
means, with
respect to any Person, (i) all obligations of such Person for borrowed money, or with respect to unearned advances of any kind to such Person, (ii) all obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, (iii) all capitalized lease obligations of such Person, (iv) all obligations of such Person under installment sale contracts, (v) all guarantees and arrangements having the economic effect of a guarantee of such Person of
any Indebtedness of any other Person, (vi) all obligations or undertakings of such Person to maintain or cause to be maintained the financial position of others or to purchase the obligations of others, (vii) all indebtedness of others
secured by a Lien on property or assets owned or acquired by such Person, whether or not the indebtedness secured thereby has been assumed, (viii) all obligations of such Person under interest rate, currency or commodity derivatives or hedging
transactions or similar arrangement (valued at the termination value thereof) and (ix) all letters of credit or performance bonds issued for the account of such Person, to the extent drawn upon.
(y)
IRS
means the Internal Revenue Service.
(z)
knowledge
means (i) with respect to Quintiles, the actual knowledge after due inquiry of the persons listed in
Section 8.3(z)
of the Quintiles Disclosure Letter, and (ii) with respect to IMS Health, the actual knowledge of after due inquiry the persons listed in
Section 8.3(z)
of the IMS Health Disclosure Letter.
(aa)
Law
means any federal, state, local or foreign law (including common law), statute, ordinance, rule, code, regulation,
order, judgment, injunction, decree or other legally enforceable requirement.
(bb)
Lenders
means any lender who is a
party to the Commitment Letter (including any lenders who become party thereto by joinder),
(cc)
NYSE
means the New
York Stock Exchange.
(dd)
Permit
means any permit, license, variance, exemption, approval, authorization, consent,
operating certificate, franchise or order of any Governmental Entity.
(ee)
Permitted Liens
mean all liens, charges,
encumbrances, mortgages, deeds of trust and security agreements disclosed in any Quintiles SEC Documents or IMS Health SEC Documents, as the case may be, together with the following (without duplication): (i) Liens imposed by Law, such as and
mechanics and materialmen Liens, in each case for sums not yet overdue for a period or more than 30 days or being contested in good faith by appropriate proceedings or such other Liens arising out of judgments or awards against Quintiles or IMS
Health, as the case may be, with respect to which Quintiles or IMS Health, respectively, shall then be proceeding with an appeal or other proceedings for review if adequate reserves with respect thereto are maintained on the books of Quintiles or
IMS Health, as the case may be, in accordance with GAAP; (ii) Liens for Taxes, assessments or other governmental charges that are (A) not yet overdue or subject to penalties for
A-71
nonpayment or (B) being contested in good faith by appropriate proceedings diligently conducted, and in either case for which adequate reserves with respect thereto are maintained on the books of
Quintiles or IMS Health, as the case may be, in accordance with GAAP; (iii) Liens securing judgments for the payment of money so long as such Liens are adequately bonded and any appropriate legal proceedings that may have been duly initiated
for the review of such judgment have not been finally terminated or the period with which such proceedings may be initiated has not expired; (iv) minor survey exceptions on existing surveys or which would be shown on a current accurate survey,
minor encumbrances, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes (including, for the avoidance of doubt, operating agreements),
matters disclosed by a current survey, or zoning or other restrictions as to the use of the affected real property, which do not in the aggregate materially adversely affect the value of the leased property or materially impair their use in the
operation of the business of the tenant; (v) Liens arising from non-exclusive licenses of Quintiles Intellectual Property or IMS Health Intellectual Property, as the case may be; (vi) Liens arising from Uniform Commercial Code financing
statement filings regarding operating leases entered into by Quintiles or IMS Health, as the case may be, in the ordinary course of business; (vii) leases, subleases, licenses and occupancy agreements by Quintiles or IMS Health, as the case may
be, as landlord, sublandlord or licensor; (viii) Liens disclosed on any title insurance policy held by Quintiles or IMS Health, as the case may be, in existence on the date of this Agreement; and (ix) with respect to leased property, all
Liens existing on the date of the applicable lease, and all mortgages and deeds of trust now or hereafter placed on the leased property by the third-party landlord.
(ff)
Person
means an individual, corporation, partnership, limited liability company, association, trust or other entity or
organization, including any Governmental Entity.
(gg)
Privacy Rights
means rights (i) provided under applicable
U.S., state and foreign Laws (including the Health Insurance Portability and Accountability Act of 1996 and the regulations promulgated under Title II, Subtitle F - Administrative Simplification thereof), (ii) under contractual agreements and
policies binding upon Quintiles or its Subsidiaries or IMS Health or its Subsidiaries, as the case may be, and (iii) that relate to the obtaining, storing, using or transmitting of confidential, personally identifiable, prescriber identifiable
or personal health information of any type.
(hh)
Quintiles Equity Plans
means the Quintiles 2013 Stock Incentive Plan,
the Quintiles 2008 Stock Incentive Plan and the Quintiles 2003 Stock Incentive Plan.
(ii)
Quintiles Material Adverse
Effect
means any fact, circumstance, development, event, change, occurrence or effect (each, an
Effect
) that (i) is or would reasonably be expected to be materially adverse to the business, assets, liabilities, financial
condition or results of operations of Quintiles and its Subsidiaries, taken as a whole or (ii) materially impairs the ability of Quintiles to consummate, or prevents or materially delays, the Merger or any of the other transactions contemplated by
this Agreement or would reasonably be expected to do so, other than any, Effect arising out of or resulting from (A) changes in general economic, financial market, business or geopolitical conditions, (B) the conditions or general changes or
developments in any of the industries in which Quintiles or its Subsidiaries operate, (C) any hurricane, tornado, flood, earthquake or other natural disasters or calamities, (D) any adoption, implementation, promulgation, repeal, modification,
amendment, reinterpretation, proposal or change in any applicable Laws or applicable accounting regulations or principles or interpretations thereof, (E) any changes in the market price or trading volume of Quintiles Common Stock, in and of
itself (
provided
, the facts or occurrences giving rise to or contributing to such change that are not otherwise excluded from the definition of Quintiles Material Adverse Effect may be taken into account in determining whether
there has been a Quintiles Material Adverse Effect), (F) any failure by Quintiles to meet internal or published projections, forecasts or revenue or earnings predictions, in and of itself (provided, that the facts or occurrences giving rise to
or contributing to such failure that are not otherwise excluded from the definition of Quintiles Material Adverse Effect may be taken into account in determining whether there has been a Quintiles Material Adverse Effect), (G) any
outbreak or escalation of hostilities, geopolitical conditions or any acts of war or terrorism, (H) the announcement of, or compliance with the terms of, this Agreement and the
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transactions contemplated hereby, including the initiation of litigation by any Person with respect to this Agreement, and including any termination of, reduction in or similar negative impact on
relationships, contractual or otherwise, with any customers, suppliers, distributors, partners or employees of Quintiles and its Subsidiaries due to the announcement and performance of this Agreement or the identity of the parties to this Agreement
or (I) any actions taken (or not taken) at the request of IMS Health;
provided
,
however
,
that any Effect referred to in clauses (A), (B), (C), (D) and (G) immediately above shall be taken into account in
determining whether a Quintiles Material Adverse Effect has occurred or would reasonably be expected to occur to the extent that such Effect has had a disproportionate effect on Quintiles and its Subsidiaries, taken as a whole, as compared to other
participants in the industries in which Quintiles or its Subsidiaries operate.
(jj)
Quintiles Registration Rights
Agreement
means that certain Second Amended and Restated Registration Rights Agreement, dated May 14, 2013, among Quintiles and the stockholders identified therein, as amended.
(kk)
Quintiles Shareholders Agreement
means that certain Amended and Restated Shareholders Agreement, dated
February 5, 2015, among Quintiles and the stockholders identified therein.
(ll)
Sarbanes-Oxley Act
means the
Sarbanes-Oxley Act of 2002.
(mm)
SEC
means the Securities and Exchange Commission.
(nn)
Securities Act
means the Securities Act of 1933, as amended.
(oo)
Subsidiary
means, with respect to any Person, any corporation, limited liability company, partnership or other
organization, whether incorporated or unincorporated, of which (i) at least a majority of the outstanding shares of capital stock, or other equity interests, having by their terms ordinary voting power to elect a majority of the board of directors
or others performing similar functions with respect to such corporation or other organization is directly or indirectly owned or controlled by such Person or by any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries, or (ii) with respect to a partnership, such Person or any other Subsidiary of such Person is a general partner of such partnership.
(pp)
Tax Return
means any return, declaration, report, certificate, election, estimate, claim for refund, information
return, statement or other written information and any other document filed or supplied or required to be filed or supplied to any Tax authority with respect to Taxes, including any schedule, attachment or supplement thereto, and including any
amendment thereof.
(qq)
Taxes
means (i) all federal, state, local, city, county, municipal, foreign and other net
income, gross income, gross receipts, sales, use, stock, ad valorem, transfer, transaction, franchise, profits, gains, registration, license, wages, lease, service, service use, employee and other withholding, social security, unemployment, welfare,
disability, payroll, employment, excise, severance, stamp, environmental, occupation, workers compensation, premium, real property, personal property, recapture, escheat or unclaimed property, windfall profits, net worth, capital, value-added,
alternative or add-on minimum, customs duties, estimated and other taxes, fees, assessments, charges or levies of any kind whatsoever, whether disputed or not, together with any interest and any penalties, additions to tax or additional amounts with
respect thereto; (ii) any liability for payment of amounts described in clause (i) pursuant to Treasury Regulation Section 1.1502-6 (or any similar provision of state, local or foreign Law) as a result of transferee or successor
liability; and (iii) any liability for the payment of amounts described in clauses (i) or (ii) as a result of any tax sharing, tax indemnity or tax allocation agreement (other than agreements entered into in the ordinary course of
business the primary purpose of which is not the sharing of Taxes).
(rr)
Willful Breach
means a material breach or
failure to perform that is the consequence of an act or omission of a party, with the knowledge that the taking of, or failure to take, such act would, or would be reasonably expected to, cause a material breach of this Agreement.
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Section 8.4
Interpretation
. When a reference is made in this Agreement to a Section,
Article, Exhibit or Schedule such reference shall be to a Section, Article, Exhibit or Schedule of this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement or in any Exhibit or Schedule are for
convenience of reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. All words used in this Agreement will be construed to be of such gender or number as the circumstances require. Any capitalized
terms used in any Exhibit or Schedule but not otherwise defined therein shall have the meaning as defined in this Agreement. All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement
as if set forth herein. The word including and words of similar import when used in this Agreement will mean including, without limitation, unless otherwise specified. The words hereof, herein and
hereunder and words of similar import when used in this Agreement shall refer to the Agreement as a whole and not to any particular provision in this Agreement. The term or is not exclusive. The word will shall be
construed to have the same meaning and effect as the word shall. References to days mean calendar days unless otherwise specified. For the avoidance of doubt, references to transactions contemplated by this Agreement or words
of similar import shall include the Plan of Conversion and the Conversion.
Section 8.5
Entire Agreement
. This Agreement
(including the Exhibits hereto), the Quintiles Disclosure Letter, the IMS Health Disclosure Letter and the Confidentiality Agreement constitute the entire agreement, and supersede all prior written agreements, arrangements, communications and
understandings and all prior and contemporaneous oral agreements, arrangements, communications and understandings among the parties with respect to the subject matter hereof and thereof.
Section 8.6
No Third Party Beneficiaries
.
(a) Nothing in this Agreement, express or implied, is intended to or shall confer upon any Person other than the parties and their respective
successors and permitted assigns any legal or equitable right, benefit or remedy of any nature under or by reason of this Agreement, except as provided in
Section 5.10
.
(b) The representations and warranties in this Agreement are the product of negotiations among the parties hereto and are for the sole benefit
of the parties hereto. Any inaccuracies in such representations and warranties are subject to waiver by the parties hereto in accordance with
Section 7.5
without notice or liability to any other Person. In some instances, the
representations and warranties in this Agreement may represent an allocation among the parties hereto of risks associated with particular matters regardless of the knowledge of any of the parties hereto. Consequently, Persons other than the parties
hereto may not rely upon the representations and warranties in this Agreement as characterizations of actual facts or circumstances as of the date of this Agreement or as of any other date.
(c) Notwithstanding anything to the contrary herein, each Debt Financing Source is an express third-party beneficiary of
Sections 7.4
(Amendment or Supplement),
8.6
(No Third Party Beneficiaries),
8.8
(Submission to Jurisdiction) and
8.12
(Waiver of Jury Trial).
Section 8.7
Governing Law
. Except for the fiduciary duties of the Quintiles Board and the validity of any corporate action on the
part of Quintiles, which shall be governed by, and construed in accordance with, the internal laws of the State of North Carolina, without regard to the laws of any other jurisdiction that might be applied because of the conflicts of laws principles
of the State of North Carolina, this Agreement and all disputes or controversies arising out of or relating to this Agreement or the transactions contemplated hereby shall be governed by, and construed in accordance with, the internal laws of the
State of Delaware, without regard to the laws of any other jurisdiction that might be applied because of the conflicts of laws principles of the State of Delaware.
Section 8.8
Submission to Jurisdiction
.
(a) Each of the parties irrevocably agrees that any legal action or proceeding arising out of or relating to this Agreement brought by any
party or its Affiliates against any other party or its Affiliates shall be brought
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and determined in the Court of Chancery of the State of Delaware in and for New Castle County, Delaware,
provided
, that if jurisdiction is not then available in the Court of Chancery of
the State of Delaware in and for New Castle County, Delaware, then any such legal action or proceeding may be brought in any federal court located in the State of Delaware or any other Delaware state court. Each of the parties hereby irrevocably
submits to the jurisdiction of the aforesaid courts for itself and with respect to its property, generally and unconditionally, with regard to any such action or proceeding arising out of or relating to this Agreement and the transactions
contemplated hereby. Each of the parties agrees not to commence any action, suit or proceeding relating thereto except in the courts described above in Delaware, other than actions in any court of competent jurisdiction to enforce any judgment,
decree or award rendered by any such court in Delaware as described herein. Each of the parties further agrees that notice as provided herein shall constitute sufficient service of process and the parties further waive any argument that such service
is insufficient. Each of the parties hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any action or proceeding arising out of or relating to this Agreement or
the transactions contemplated hereby, (a) any claim that it is not personally subject to the jurisdiction of the courts in Delaware as described herein for any reason, (b) that it or its property is exempt or immune from jurisdiction of
any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) that (i) the suit,
action or proceeding in any such court is brought in an inconvenient forum, (ii) the venue of such suit, action or proceeding is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such courts.
(b) Notwithstanding anything herein to the contrary, each of the parties irrevocably agrees that any legal action or proceeding involving any
Debt Financing Source arising out of or relating to this Agreement, the Commitment Letter or the Debt Financing shall be brought and determined in the Supreme Court of the State of New York, County of New York;
provided
, that if jurisdiction
is not then available in the Supreme Court of the State of New York, County of New York, then any such legal action or proceeding may be brought in any federal court located in the State of New York (and, in each case, any appellate courts thereof).
Each of the parties hereby irrevocably submits to the jurisdiction of the aforesaid courts for itself and with respect to its property, generally and unconditionally, with regard to any such action or proceeding involving any Debt Financing Source
arising out of or relating to this Agreement, the Commitment Letter or the Debt Financing and the transactions contemplated hereby or thereby. Each of the parties agrees not to commence any action, suit or proceeding involving any Debt Financing
Source relating thereto except in the courts described above in New York, other than actions in any court of competent jurisdiction to enforce any judgment, decree or award rendered by any such court in New York as described herein. Each of the
parties further agrees that notice as provided herein shall constitute sufficient service of process and the parties further waive any argument that such service is insufficient. Each of the parties hereby irrevocably and unconditionally waives, and
agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any action or proceeding involving any Debt Financing Source arising out of or relating to this Agreement, the Commitment Letter or the Debt Financing or the
transactions contemplated hereby or thereby, (a) any claim that it is not personally subject to the jurisdiction of the courts in New York as described herein for any reason, (b) that it or its property is exempt or immune from jurisdiction of any
such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) that (i) the suit, action or
proceeding in any such court is brought in an inconvenient forum, (ii) the venue of such suit, action or proceeding is improper or (iii) this Agreement, the Commitment Letter, the Debt Financing, or the subject matter hereof or thereof,
may not be enforced in or by such courts.
Section 8.9
Assignment; Successors
. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement may be assigned or delegated, in whole or in part, by operation of law or otherwise, by any party without the prior written consent of the other parties, and any such assignment without such prior
written consent shall be null and void. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective successors and assigns.
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Section 8.10
Specific Performance
. The parties agree that irreparable damage would
occur in the event that the parties hereto do not perform the provisions of this Agreement in accordance with its terms or otherwise breach such provisions. Accordingly, prior to any termination of this Agreement pursuant to
Section 7.1
,
the parties acknowledge and agree that each party shall be entitled to an injunction, specific performance and other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in the Court of
Chancery of the State of Delaware in and for New Castle County, Delaware,
provided
, that if jurisdiction is not then available in the Court of Chancery of the State of Delaware in and for New Castle County, Delaware, then in any federal court
located in the State of Delaware or any other Delaware state court, this being in addition to any other remedy to which such party is entitled at law or in equity. Each of the parties hereby further waives (a) any defense in any action for
specific performance that a remedy at law would be adequate and (b) any requirement under any law to post security as a prerequisite to obtaining equitable relief.
Section 8.11
Severability
. Whenever possible, each provision or portion of any provision of this Agreement shall be interpreted in
such manner as to be effective and valid under applicable Law, but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable Law or rule in any jurisdiction,
such invalidity, illegality or unenforceability shall not affect any other provision or portion of any provision in such jurisdiction, and this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never been contained herein.
Section 8.12
Waiver of Jury Trial
. EACH
OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE DEBT FINANCING, THE COMMITMENT LETTER, ANY ALTERNATIVE FINANCING OR
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, INCLUDING WITH RESPECT TO ANY ACTION, PROCEEDING OR COUNTERCLAIM INVOLVING THE DEBT FINANCING SOURCES.
Section 8.13
Counterparts
. This Agreement may be executed in two or more counterparts, all of which shall be considered one and
the same instrument and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other party.