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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549



FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

December 31, 2012
Date of Report (Date of earliest event reported)

ABBVIE INC.
(Exact name of registrant as specified in its charter)



Delaware
(State or other Jurisdiction
of Incorporation)
  001-35565
(Commission
File Number)
  32-0375147
(IRS Employer
Identification No.)



1 North Waukegan Road
North Chicago, Illinois 60064

(Address of principal executive offices)(Zip Code)

Registrant's telephone number, including area code: (847) 932-7900

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

   


Item 1.01.    Entry Into a Material Definitive Agreement.

        On November 28, 2012, AbbVie Inc. ("AbbVie") entered into a separation and distribution agreement with Abbott Laboratories ("Abbott"), pursuant to which Abbott agreed to transfer its research-based pharmaceuticals business to AbbVie (the "Separation") and distribute 100% of the outstanding stock of AbbVie to the Abbott shareholders in a tax-free distribution (the "Distribution"). The Distribution was made on January 1, 2013 to Abbott shareholders of record as of the close of business on December 12, 2012. As a result of the Distribution, AbbVie is now an independent public company trading under the symbol "ABBV" on the New York Stock Exchange.

        In connection with the Separation and Distribution, on December 31, 2012, AbbVie entered into various agreements with Abbott to provide a framework for AbbVie's relationship with Abbott after the Separation and Distribution, including the following agreements:

    a U.S. Transition Services Agreement;

    an Ex-U.S. Transition Services Agreement;

    a Tax Sharing Agreement;

    a Special Products Master Agreement;

    an Employee Matters Agreement;

    an International Commercial Operations Agreement;

    a Luxembourg International Commercial Operations Agreement;

    an Information Technology Agreement; and

    a Transitional Trademark License Agreement.

        A summary of these agreements can be found in AbbVie's information statement, dated December 10, 2012 (the "Information Statement"), which is included as Exhibit 99.1 to this Form 8-K, under the section entitled "Certain Relationships and Related Person Transactions." These summaries are incorporated by reference into this Item 1.01 as if restated in full. The description of those agreements set forth under this Item 1.01 is qualified in its entirety by reference to the complete terms and conditions of those agreements, which are attached hereto as Exhibits 10.1, 10.2, 10.3, 10.4, 10.5, 10.6, 10.7, 10.8, and 10.9.

Item 5.02.    Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

        On December 31, 2012, the Board of Directors of AbbVie (the "Board") expanded its size from three directors to nine directors, effective as of immediately prior to 12:01 a.m., Eastern Time, on January 1, 2013 (the "Effective Time"). Each of Richard A. Gonzalez, the Chairman and Chief Executive Officer of AbbVie, Robert J. Alpern, M.D., Roxanne S. Austin, William H.L. Burnside, Edward M. Liddy, Edward J. Rapp, Roy S. Roberts, and Glenn F. Tilton were elected as a director of AbbVie, effective as of immediately prior to the Effective Time. Thomas C. Freyman and Greg W. Linder, who had been serving as members of the Board, ceased to be directors of AbbVie effective as of immediately prior to the Effective Time. Frederick H. Waddell, who had been elected to the Board effective November 29, 2012, remains on the Board and will continue to serve as a director of AbbVie following the Distribution. Biographical information on each of the directors elected to the Board, as well as on Frederick H. Waddell, can be found in AbbVie's Information Statement under the section entitled "Management—Board of Directors Following the Separation," which is incorporated by reference into this Item 5.02.

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        As a result of the elections and resignations described above, the Board of AbbVie is currently constituted into three classes, as follows:

Class I :   William H.L. Burnside, Edward J. Rapp, and Roy S. Roberts are appointed to serve in the first class of directors of the Board whose term expires at AbbVie's 2013 annual meeting of stockholders;

Class II :

 

Robert J. Alpern, M.D., Edward M. Liddy, and Frederick H. Waddell are appointed to serve in the second class of directors of the Board whose term expires at AbbVie's 2014 annual meeting of stockholders; and

Class III :

 

Roxanne S. Austin, Richard A. Gonzalez, and Glenn F. Tilton are appointed to serve in the third class of directors of the Board whose term expires at AbbVie's 2015 annual meeting of stockholders.

        Also effective as of immediately prior to the Effective Time:

    Mr. Gonzalez (Chair), Ms. Austin, and Messrs. Liddy, Roberts, and Tilton were appointed to serve as members of the Executive Committee of the Board;

    Ms. Austin (Chair) and Messrs. Burnside and Rapp were appointed to serve as members of the Audit Committee of the Board. Mr. Waddell had already been appointed to serve as a member of the Audit Committee of the Board effective November 29, 2012 and will continue to serve in that capacity;

    Mr. Tilton (Chair), Dr. Alpern, and Messrs. Burnside and Roberts were appointed to serve as members of the Nominations and Governance Committee of the Board;

    Mr. Liddy (Chair), Ms. Austin, and Messrs. Tilton and Waddell were appointed to serve as members of the Compensation Committee of the Board;

    Mr. Roberts (Chair), Dr. Alpern, and Messrs. Liddy and Rapp were appointed to serve as members of the Public Policy Committee of the Board; and

    Mr. Tilton was appointed as the lead director of the Board.

        Effective January 1, 2013, AbbVie assumed change in control agreements between Abbott and certain AbbVie officers, including Mr. Gonzalez and Ms. Schumacher, which provide certain benefits upon a qualifying termination of the officer's employment following a change in control of AbbVie. The terms of the agreements are described in AbbVie's Information Statement under the section entitled "Executive Compensation—Potential Payments on Termination or Change of Control," which is incorporated by reference into this Item 5.02.

Item 5.03.    Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year

        Effective as of 11:59 p.m., Eastern Time, on December 31, 2012, AbbVie amended and restated its Certificate of Incorporation (the "Amended and Restated Certificate of Incorporation") and its By-Laws (the "Amended and Restated By-Laws"). A description of the material provisions of the Amended and Restated Certificate of Incorporation and the Amended and Restated By-Laws can be found in AbbVie's Information Statement under the section entitled "Description of AbbVie's Capital Stock," which is incorporated by reference into this Item 5.03. The description set forth under this Item 5.03 is qualified in its entirety by reference to the full text of the Amended and Restated Certificate of Incorporation and the Amended and Restated By-Laws, which are attached hereto as Exhibits 3.1 and 3.2, respectively.

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Item 5.05.    Amendments to the Registrant's Code of Ethics, or Waiver of a Provision of the Code of Ethics

        In connection with the Distribution, the Board adopted a Code of Business Conduct effective as of immediately prior to the Effective Time. A copy of AbbVie's Code of Business Conduct is available under the Investor Relations section of AbbVie's website at www.abbvieinvestor.com .

Item 8.01.    Other Events

        On January 2, 2013, AbbVie issued a press release announcing the completion of the Distribution and the start of AbbVie's operations as an independent company. A copy of the press release is attached hereto as Exhibit 99.2.

        In connection with the Distribution, the Board adopted Corporate Governance Guidelines effective as of immediately prior to the Effective Time. A copy of AbbVie's Corporate Governance Guidelines is available under the Investor Relations section of AbbVie's website at www.abbvieinvestor.com .

        In connection with the Distribution, the Board adopted director independence guidelines on December 31, 2012. A copy of AbbVie's director independence guidelines is available under the Investor Relations section of AbbVie's website at www.abbvieinvestor.com .

Item 9.01.    Financial Statements and Exhibits.

(d)
Exhibits

Exhibit No.   Exhibit
  3.1   Amended and Restated Certificate of Incorporation of AbbVie Inc.

 

3.2

 

Amended and Restated By-Laws of AbbVie Inc.

 

10.1

 

U.S. Transition Services Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.2

 

Ex-U.S. Transition Services Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.3

 

Tax Sharing Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.4

 

Special Products Master Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.5

 

Employee Matters Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.6

 

International Commercial Operations Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.7

 

Luxembourg International Commercial Operations Agreement, dated as of December 31, 2012, by and between Abbott Investments Luxembourg S.à.r.l. and AbbVie Investments S.à.r.l.

 

10.8

 

Information Technology Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.9

 

Transitional Trademark License Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

99.1

 

Information Statement of AbbVie Inc., dated December 10, 2012

 

99.2

 

Press release of AbbVie Inc. dated January 2, 2013

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SIGNATURE

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

    ABBVIE INC.

Date: January 2, 2013

 

By:

 

/s/ WILLIAM J. CHASE

William J. Chase
Executive Vice President, Chief Financial Officer


EXHIBIT INDEX

Exhibit No.   Exhibit
  3.1   Amended and Restated Certificate of Incorporation of AbbVie Inc.

 

3.2

 

Amended and Restated By-Laws of AbbVie Inc.

 

10.1

 

U.S. Transition Services Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.2

 

Ex-U.S. Transition Services Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.3

 

Tax Sharing Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.4

 

Special Products Master Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.5

 

Employee Matters Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.6

 

International Commercial Operations Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.7

 

Luxembourg International Commercial Operations Agreement, dated as of December 31, 2012, by and between Abbott Investments Luxembourg S.à.r.l. and AbbVie Investments S.à.r.l.

 

10.8

 

Information Technology Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

10.9

 

Transitional Trademark License Agreement, dated as of December 31, 2012, by and between Abbott Laboratories and AbbVie Inc.

 

99.1

 

Information Statement of AbbVie Inc., dated December 10, 2012

 

99.2

 

Press release of AbbVie Inc. dated January 2, 2013



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SIGNATURE
EXHIBIT INDEX

Exhibit 3.1

 

AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
ABBVIE INC.

 

AbbVie Inc., a corporation organized and existing under the laws of the State of Delaware, pursuant to Sections 242 and 245 of the General Corporation Law of the State of Delaware, as it may be amended (the “ DGCL ”), hereby certifies as follows:

 

1.                                       The name of this corporation is AbbVie Inc.  The original Certificate of Incorporation was filed on April 10, 2012.

 

2.                                       This Amended and Restated Certificate of Incorporation was duly adopted in accordance with the provisions of Sections 242 and 245 of the DGCL and by the written consent of its sole stockholder in accordance with Section 228 of the DGCL, and is to become effective as of 11:59 p.m., Eastern time, on December 31, 2012.

 

3.                                       This Amended and Restated Certificate of Incorporation restates and amends the original Certificate of Incorporation to read in its entirety as follows:

 


 

ARTICLE I
NAME OF CORPORATION

 

The name by which the corporation is to be known is AbbVie Inc. (the “ Corporation ”).

 

ARTICLE II
REGISTERED OFFICE; REGISTERED AGENT

 

The address of the Corporation’s registered office in the State of Delaware is 1209 Orange Street, in the City of Wilmington, County of New Castle.  The name of its registered agent at such address is The Corporation Trust Company.  The Corporation may have such other offices, either within or without the State of Delaware, as the Board of Directors of the Corporation (the “ Board of Directors ”) may designate or as the business of the Corporation may from time to time require.

 

ARTICLE III
PURPOSE

 

The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the DGCL.

 

ARTICLE IV
STOCK

 

Section 1.  Authorized Stock .  The total number of shares of capital stock that the Corporation shall have authority to issue is 4,200,000,000 shares, consisting of (a) 4,000,000,000 shares of common

 

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stock, par value $0.01 per share (the “ Common Stock ”), and (b) 200,000,000 shares of preferred stock, par value $0.01 per share (the “ Preferred Stock ”).

 

Section 2.  Common Stock .  Except as may otherwise be provided in this Amended and Restated Certificate of Incorporation, in a Preferred Stock Designation (as hereinafter defined), or as required by law, the holders of outstanding shares of Common Stock shall have the right to vote on all questions to the exclusion of all other stockholders, each holder of record of Common Stock being entitled to one vote for each share of Common Stock standing in the name of the stockholder on the books of the Corporation.

 

Section 3.  Preferred Stock .  Shares of Preferred Stock may be issued from time to time in one or more series.  The Board of Directors (or any committee to which it may duly delegate the authority granted in this Article IV) is hereby empowered to authorize the issuance from time to time of shares of Preferred Stock in one or more series, for such consideration and for such corporate purposes as the Board of Directors (or such committee thereof) may from time to time determine, and by filing a certificate (hereinafter referred to as a “ Preferred Stock Designation ”) pursuant to applicable law of the State of Delaware as it presently exists or may hereafter be amended to establish from time to time for each such series the number of shares to be included in each such series and to fix the designations, powers, rights and preferences of the shares of each such series, and the qualifications, limitations and restrictions thereof to the fullest extent now or hereafter permitted by this Amended and Restated Certificate of Incorporation and the laws of the State of Delaware, including, without limitation, voting rights (if any), dividend rights, dissolution rights, conversion rights, exchange rights and redemption rights thereof, as shall be stated and expressed in a resolution or resolutions adopted by the Board of Directors (or such committee thereof) providing for the issuance of such series of Preferred Stock.  Each series of Preferred Stock shall be distinctly designated.  The authority of the Board of Directors with respect to each series of Preferred Stock shall include, but not be limited to, determination of the following:

 

(i)                      the designation of the series, which may be by distinguishing number, letter or title;

 

(ii)                   the number of shares of the series, which number the Board of Directors may thereafter (except where otherwise provided in the Preferred Stock Designation) increase or decrease (but not below the number of shares thereof then outstanding);

 

(iii)                the amounts payable on, and the preferences, if any, of shares of the series in respect of dividends, and whether such dividends, if any, shall be cumulative or noncumulative;

 

(iv)               dates at which dividends, if any, shall be payable;

 

(v)                  the redemption rights and price or prices, if any, for shares of the series;

 

(vi)               the terms and amount of any sinking fund provided for the purchase or redemption of shares of the series;

 

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(vii)            the amounts payable on, and the preferences, if any, of shares of the series in the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation;

 

(viii)         whether the shares of the series shall be convertible into or exchangeable for shares of any other class or series, or any other security, of the Corporation or any other corporation, and, if so, the specification of such other class or series or such other security, the conversion or exchange price or prices or rate or rates, any adjustments thereof, the date or dates at which such shares shall be convertible or exchangeable and all other terms and conditions upon which such conversion or exchange may be made;

 

(ix)                 restrictions on the issuance of shares of the same series or of any other class or series; and

 

(x)                    the voting rights, if any, of the holders of shares of the series.

 

ARTICLE V
TERM

 

The term of existence of the Corporation shall be perpetual.

 

ARTICLE VI
BOARD OF DIRECTORS

 

Section 1.  Number of Directors .  Subject to the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances, the number of directors shall be fixed from time to time exclusively pursuant to a resolution adopted by a majority of the total number of directors that the Corporation would have if there were no vacancies (the “ Whole Board ”).

 

Section 2.  Classes of Directors .  Subject to the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances, the directors shall be divided, with respect to the time for which they severally hold office, into three classes, as nearly equal in number as is reasonably possible, with the term of office of the first class to expire at the 2013 annual meeting of stockholders, the term of office of the second class to expire at the 2014 annual meeting of stockholders and the term of office of the third class to expire at the 2015 annual meeting of stockholders, with each director to hold office until his or her successor shall have been duly elected and qualified.  At each annual meeting of stockholders, commencing with the 2013 annual meeting, (a) directors elected to succeed those directors whose terms then expire shall be elected for a term of office to expire at the third succeeding annual meeting of stockholders after their election, with each director to hold office until his or her successor shall have been duly elected and qualified, and (b) if authorized by a resolution of the Board of Directors, directors may be elected to fill any vacancy on the Board of Directors, regardless of how such vacancy shall have been created.

 

Section 3.  Vacancies .  Subject to applicable law and the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, and unless the Board

 

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of Directors otherwise determines, vacancies resulting from death, resignation, retirement, disqualification, removal from office or other cause, and newly created directorships resulting from any increase in the authorized number of directors, may be filled only by the affirmative vote of a majority of the remaining directors, though less than a quorum of the Board of Directors, and in the event that there is only one director remaining in office, by such sole remaining director, and directors so chosen shall hold office for a term expiring at the annual meeting of stockholders at which the term of office of the class to which they have been appointed expires and until such director’s successor shall have been duly elected and qualified.

 

Section 4.  Removal .  Subject to the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, any director, or the entire Board of Directors, may be removed from office at any time but only for cause by the affirmative vote of the holders of at least a majority of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors.

 

ARTICLE VII
STOCKHOLDER ACTION

 

Section 1.  Stockholder Action by Written Consent .  Subject to the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, any action required or permitted to be taken by the stockholders of the Corporation must be effected at an annual or special meeting of stockholders of the Corporation and may not be effected by any consent in writing by such stockholders.

 

Section 2.  Special Meetings of Stockholders .  Subject to the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, special meetings of stockholders may only be called by or at the direction of the Chairman of the Board of Directors, the Chief Executive Officer, any President, or the Board of Directors pursuant to a resolution adopted by a majority of the Whole Board.  At any special meeting of the stockholders, only such business shall be conducted or considered as shall have been properly brought before the meeting pursuant to the Corporation’s notice of meeting.  To be properly brought before a special meeting, proposals of business must be (a) specified in the Corporation’s notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, or (b) otherwise properly brought before the special meeting, by or at the direction of the Board of Directors.

 

ARTICLE VIII
AMENDMENTS TO BY-LAWS

 

In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the By-laws of the Corporation (the “ By-laws ”) may be altered, amended or repealed, in whole or in part, and new By-laws may be adopted, (i) by the affirmative vote of shares representing a majority of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors; provided , however , that any proposed alteration, amendment or repeal of, or the adoption of any By-law inconsistent with, Sections 2.2, 2.12, 3.2, 3.3, 3.10 or 3.11, Article VII or Article X of the By-laws (in each case, as in effect on the date hereof), or the alteration, amendment or repeal of, or the adoption of any provision

 

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inconsistent with this sentence, may only be made by the affirmative vote of shares representing not less than eighty percent (80%) of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors; and provided further , however , that in the case of any such stockholder action at a meeting of stockholders, notice of the proposed alteration, amendment, repeal or adoption of the new By-law or By-laws must be contained in the notice of such meeting, or (ii) by action of the Board of Directors of the Corporation; provided , however , that the case of any such action at a meeting of the Board of Directors, notice of the proposed alteration, amendment, repeal or adoption of the new By-law or By-laws must be given not less than two days prior to the meeting.

 

ARTICLE IX
DIRECTOR LIABILITY

 

To the fullest extent permitted by the DGCL, as the same exists or may hereafter be amended, a director of the Corporation shall not be personally liable either to the Corporation or to any of its stockholders for monetary damages for breach of fiduciary duty as a director.  Any amendment or modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of the Corporation hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or repeal.  If the DGCL hereafter is amended to further eliminate or limit the liability of a director, then a director of the Corporation, in addition to the circumstances in which a director is not personally liable as set forth in the preceding sentence, shall not be liable to the fullest extent permitted by the amended DCGL.

 

ARTICLE X
FORUM AND VENUE

 

Unless the Board of Directors otherwise determines, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director or officer of the Corporation to the Corporation or the Corporation’s stockholders, creditors or other constituents, (iii) any action asserting a claim against the Corporation or any director or officer of the Corporation arising pursuant to any provision of the DGCL or the Amended and Restated Certificate of Incorporation or By-laws (as either may be amended from time to time), or (iv) any action asserting a claim against the Corporation or any director or officer of the Corporation governed by the internal affairs doctrine; provided , that , if and only if the Court of Chancery of the State of Delaware dismisses any such action for lack of subject matter jurisdiction, such action may be brought in another state court sitting in the State of Delaware.

 

ARTICLE XI
AMENDMENTS

 

In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware as they presently exist or may hereafter be amended, subject to any limitations contained elsewhere in this Amended and Restated Certificate of Incorporation, the Corporation may from time to time adopt, amend or repeal any provisions of this Amended and Restated

 

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Certificate of Incorporation; provided , however , that any proposed alteration, amendment or repeal of, or the adoption of any provision inconsistent with, Article VI and Article VII of this Amended and Restated Certificate of Incorporation (in each case, as in effect on the date hereof), or the alteration, amendment or repeal of, or the adoption of any provision inconsistent with this sentence, may only be made by the affirmative vote of shares representing not less than eighty percent (80%) of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors.

 

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Exhibit 3.2

 

AMENDED AND RESTATED BY-LAWS
OF
ABBVIE INC.

 

Incorporated under the Laws of the State of Delaware

 


 

These Amended and Restated By-laws (the “ By-laws ”) of AbbVie Inc., a Delaware corporation, are effective as of 11:59 p.m., Eastern time, on December 31, 2012 and hereby amend and restate the previous by-laws of AbbVie Inc., which are hereby deleted in their entirety and replaced with the following:

 

ARTICLE I
OFFICES AND RECORDS

 

Section 1.1  Delaware Office .  The registered office of AbbVie Inc. (the “ Corporation ”) in the State of Delaware shall be located in the City of Wilmington, County of New Castle, and the name and address of its registered agent is The Corporation Trust Company, 1209 Orange Street, Wilmington, Delaware 19904.

 

Section 1.2  Other Offices .  The Corporation may have such other offices, either inside or outside the State of Delaware, as the Board of Directors of the Corporation (the “ Board of Directors ”) may designate or as the business of the Corporation may from time to time require.

 

Section 1.3  Books and Records .  The books and records of the Corporation may be kept inside or outside the State of Delaware at such place or places as may from time to time be designated by the Board of Directors.

 

ARTICLE II
STOCKHOLDERS

 

Section 2.1  Annual Meeting .  The annual meeting of the stockholders of the Corporation shall be held on such date and at such place and time as may be fixed by resolution of the Board of Directors.

 

Section 2.2  Special Meeting .  Subject to the rights of the holders of any series of stock having a preference over the Common Stock of the Corporation as to dividends, voting or upon liquidation (“ Preferred Stock ”) with respect to such series of Preferred Stock, special meetings of the stockholders may be called only by the Chairman of the Board, the Chief Executive Officer, any President, or the Board of Directors pursuant to a resolution adopted by a majority of the total number of directors which the Corporation would have if there were no vacancies (the “ Whole Board ”).

 

Section 2.3  Place of Meeting .  The Board of Directors or the Chairman of the Board, as the case may be, may designate the place of meeting for any annual or special meeting of the stockholders.  If no designation is so made, the place of meeting shall be the principal office of the Corporation.

 



 

Section 2.4  Notice of Meeting .  Written or printed notice, stating the place, date and hour of the meeting, the means of remote communications, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered by the Corporation not less than ten (10) days nor more than sixty (60) days before the date of the meeting, either personally, by electronic transmission in the manner provided in Section 232 of the General Corporation Law of the State of Delaware (as it may be amended, the “ DGCL ”) (except to the extent prohibited by Section 232(e) of the DGCL) or by mail, to each stockholder of record entitled to vote at such meeting.  If mailed, such notice shall be deemed to be delivered when deposited in the United States mail with postage thereon prepaid, addressed to the stockholder at his or her address as it appears on the stock transfer books of the Corporation.  If notice is given by electronic transmission, such notice shall be deemed to be given at the times provided in the DGCL.  Such further notice shall be given as may be required by law.  Meetings may be held without notice if all stockholders entitled to vote are present, or if notice is waived by those not present in accordance with Section 8.4 of these By-laws.  Any previously scheduled meeting of the stockholders may be postponed, and, unless the Amended and Restated Certificate of Incorporation of the Corporation (the “ Certificate of Incorporation ”) otherwise provides, any special meeting of the stockholders may be cancelled, by resolution of the Board of Directors upon public notice given prior to the date previously scheduled for such meeting of stockholders.

 

Section 2.5  Quorum and Adjournment .  Except as otherwise provided by law or by the Certificate of Incorporation, the holders of a majority of the outstanding shares of the Corporation entitled to vote generally in the election of directors (the “ Voting Stock ”), represented in person or by proxy, shall constitute a quorum at a meeting of stockholders, except that when specified business is to be voted on by a class or series of stock voting as a class, the holders of a majority of the shares of such class or series shall constitute a quorum of such class or series for the transaction of such business.  The Chairman of the Board of Directors or the President may adjourn the meeting from time to time, whether or not there is a quorum.  No notice of the time and place of adjourned meetings need be given except as required by law.  The stockholders present at a duly called meeting at which a quorum is present may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.

 

Section 2.6  Proxies .  At all meetings of stockholders, a stockholder may vote by proxy executed in writing (or in such manner prescribed by the DGCL) by the stockholder, or by his or her duly authorized attorney in fact.

 

Section 2.7  Order of Business .

 

(A)                                Annual Meetings of Stockholders .  At any annual meeting of the stockholders, only such nominations of persons for election to the Board of Directors shall be made, and only such other business shall be conducted or considered, as shall have been properly brought before the meeting.  For nominations to be properly made at an annual meeting, and proposals of other business to be properly brought before an annual meeting, nominations and proposals of other business must be:  (a) specified in the Corporation’s notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (b) otherwise

 

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properly made at the annual meeting, by or at the direction of the Board of Directors or (c) otherwise properly requested to be brought before the annual meeting by a stockholder of the Corporation in accordance with these By-laws.  For nominations of persons for election to the Board of Directors or proposals of other business to be properly requested by a stockholder to be made at an annual meeting, a stockholder must (i) be a stockholder of record at the time of giving of notice of such annual meeting by or at the direction of the Board of Directors and at the time of the annual meeting, (ii) be entitled to vote at such annual meeting and (iii) comply with the procedures set forth in these By-laws as to such business or nomination.  The immediately preceding sentence shall be the exclusive means for a stockholder to make nominations or other business proposals (other than matters properly brought under Rule 14a-8 under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”) and included in the Corporation’s notice of meeting) before an annual meeting of stockholders.

 

(B)                                Special Meetings of Stockholders .  At any special meeting of the stockholders, only such business shall be conducted or considered, as shall have been properly brought before the meeting pursuant to the Corporation’s notice of meeting.  To be properly brought before a special meeting, proposals of business must be (a) specified in the Corporation’s notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, or (b) otherwise properly brought before the special meeting, by or at the direction of the Board of Directors.

 

Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of meeting (a) by or at the direction of the Board of Directors or (b) provided that the Board of Directors has determined that directors shall be elected at such meeting, by any stockholder of the Corporation who (i) is a stockholder of record at the time of giving of notice of such special meeting and at the time of the special meeting, (ii) is entitled to vote at the meeting, and (iii) complies with the procedures set forth in these By-laws as to such nomination.  The immediately preceding sentence shall be the exclusive means for a stockholder to make nominations (other than matters properly brought under Rule 14a-8 under the Exchange Act and included in the Corporation’s notice of meeting) before a special meeting of stockholders.

 

(C)                                General .  Except as otherwise provided by law, the Certificate of Incorporation or these By-laws, the Chairman of any annual or special meeting shall have the power to determine whether a nomination or any other business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with these By-laws and, if any proposed nomination or other business is not in compliance with these By-laws, to declare that no action shall be taken on such nomination or other proposal and such nomination or other proposal shall be disregarded.

 

Section 2.8  Advance Notice of Stockholder Business and Nominations .

 

(A)                                Annual Meeting of Stockholders .  Without qualification or limitation, subject to Section 2.8(C)(4) of these By-laws, for any nominations or any other business to be properly brought before an annual meeting by a stockholder pursuant to Section 2.7(A) of these By-laws, the stockholder must have given timely notice thereof (including, in the case of nominations, the completed and signed questionnaire, representation and agreement required

 

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by Section 2.9 of these By-laws), and timely updates and supplements thereof, in writing to the Secretary, and such other business must otherwise be a proper matter for stockholder action.

 

To be timely, a stockholder’s notice shall be delivered to the Secretary at the principal executive offices of the Corporation not earlier than the close of business on the 120th day and not later than the close of business on the 90th day prior to the first anniversary of the preceding year’s annual meeting; provided , however , that in the event that the date of the annual meeting is more than 30 days before or more than 60 days after such anniversary date, notice by the stockholder must be so delivered not earlier than the close of business on the 120th day prior to the date of such annual meeting and not later than the close of business on the later of the 90th day prior to the date of such annual meeting or, if the first public announcement of the date of such annual meeting is less than 100 days prior to the date of such annual meeting, the 10th day following the day on which public announcement of the date of such meeting is first made by the Corporation.  In no event shall any adjournment or postponement of an annual meeting, or the public announcement thereof, commence a new time period for the giving of a stockholder’s notice as described above.

 

Notwithstanding anything in the immediately preceding paragraph to the contrary, in the event that the number of directors to be elected to the Board of Directors is increased by the Board of Directors, and there is no public announcement by the Corporation naming all of the nominees for director or specifying the size of the increased Board of Directors at least 100 days prior to the first anniversary of the preceding year’s annual meeting, a stockholder’s notice required by this Section 2.8(A) shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the 10th day following the day on which such public announcement is first made by the Corporation.

 

In addition, to be considered timely, a stockholder’s notice shall further be updated and supplemented, if necessary, so that the information provided or required to be provided in such notice shall be true and correct as of the record date for the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for the meeting in the case of the update and supplement required to be made as of the record date, and not later than eight (8) business days prior to the date for the meeting or any adjournment or postponement thereof in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof.

 

(B)                                Special Meetings of Stockholders .  Subject to Section 2.8(C)(4) of these By-laws, in the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more directors to the Board of Directors, any stockholder may nominate a person or persons (as the case may be) for election to such position(s) as specified in the Corporation’s notice of meeting, provided that the stockholder gives timely notice thereof (including the completed and signed questionnaire, representation and agreement required by Section 2.9 of these By-laws), and timely updates and supplements thereof, in writing, to the Secretary.

 

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To be timely, a stockholder’s notice shall be delivered to the Secretary at the principal executive offices of the Corporation not earlier than the close of business on the 120th day prior to the date of such special meeting and not later than the close of business on the later of the 90th day prior to the date of such special meeting or, if the first public announcement of the date of such special meeting is less than 100 days prior to the date of such special meeting, the 10th day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting.  In no event shall any adjournment or postponement of a special meeting of stockholders, or the public announcement thereof, commence a new time period for the giving of a stockholder’s notice as described above.

 

In addition, to be considered timely, a stockholder’s notice shall further be updated and supplemented, if necessary, so that the information provided or required to be provided in such notice shall be true and correct as of the record date for the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for the meeting in the case of the update and supplement required to be made as of the record date, and not later than eight (8) business days prior to the date for the meeting, any adjournment or postponement thereof in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof.

 

(C)                Disclosure Requirements .

 

(i)                                      To be in proper form, a stockholder’s notice (whether given pursuant to Section 2.7(A) or 2.7(B) of these By-laws) to the Secretary must include the following, as applicable.

 

(1)                                  As to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made, a stockholder’s notice must set forth:  (i) the name and address of such stockholder, as they appear on the Corporation’s books, of such beneficial owner, if any, and of their respective affiliates or associates or others acting in concert therewith, (ii) (A) the class or series and number of shares of the Corporation which are, directly or indirectly, owned beneficially and of record by such stockholder, such beneficial owner and their respective affiliates or associates or others acting in concert therewith, (B) any option, warrant, convertible security, stock appreciation right, or similar right with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares of the Corporation or with a value derived in whole or in part from the value of any class or series of shares of the Corporation, or any derivative or synthetic arrangement having the characteristics of a long position in any class or series of shares of the Corporation, or any contract, derivative, swap or other transaction or series of transactions designed to produce economic benefits and risks that correspond substantially to the ownership of any class or series of shares of the Corporation, including due to the fact that the value of such contract, derivative, swap or other transaction or series of transactions is determined by reference to the price, value or volatility of any class or series of shares of the Corporation, whether or not such instrument, contract or right shall be subject to settlement in the underlying class or series of shares of the Corporation, through the delivery of cash or other property, or otherwise, and without

 

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regard to whether the stockholder of record, the beneficial owner, if any, or any affiliates or associates or others acting in concert therewith, may have entered into transactions that hedge or mitigate the economic effect of such instrument, contract or right, or any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the Corporation (any of the foregoing, a “ Derivative Instrument ”) directly or indirectly owned beneficially by such stockholder, the beneficial owner, if any, or any affiliates or associates or others acting in concert therewith, (C) any proxy, contract, arrangement, understanding, or relationship pursuant to which such stockholder has a right to vote any class or series of shares of the Corporation, (D) any agreement, arrangement, understanding, relationship or otherwise, including any repurchase or similar so-called “stock borrowing” agreement or arrangement, involving such stockholder, directly or indirectly, the purpose or effect of which is to mitigate loss to, reduce the economic risk (of ownership or otherwise) of any class or series of the shares of the Corporation by, manage the risk of share price changes for, or increase or decrease the voting power of, such stockholder with respect to any class or series of the shares of the Corporation, or which provides, directly or indirectly, the opportunity to profit or share in any profit derived from any decrease in the price or value of any class or series of the shares of the Corporation (any of the foregoing, a “ Short Interest ”), (E) any rights to dividends on the shares of the Corporation owned beneficially by such stockholder that are separated or separable from the underlying shares of the Corporation, (F) any proportionate interest in shares of the Corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such stockholder is a general partner or, directly or indirectly, beneficially owns an interest in a general partner of such general or limited partnership, (G) any performance-related fees (other than an asset-based fee) that such stockholder or members of such stockholder’s immediate family sharing the same household are entitled to based on any increase or decrease in the value of shares of the Corporation or Derivative Instruments, if any, (H) any significant equity interests or any Derivative Instruments or Short Interests in any principal competitor of the Corporation held by such stockholder, and (I) any direct or indirect interest of such stockholder in any contract with the Corporation, any affiliate of the Corporation or any principal competitor of the Corporation (including, in any such case, any employment agreement, collective bargaining agreement or consulting agreement), and (iii) any other information relating to such stockholder and beneficial owner, if any, that would be required to be disclosed in a proxy statement and form of proxy or other filings required to be made in connection with solicitations of proxies for, as applicable, the proposal and/or for the election of directors in a contested election pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder;

 

(2)                                  If the notice relates to any business other than a nomination of a director or directors that the stockholder proposes to bring before the meeting, a stockholder’s notice must, in addition to the matters set forth in paragraph (a) above, also set forth:  (i) a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest of such stockholder and beneficial owner, if any, in such business, (ii) the text of the proposal or business (including the text of any resolutions proposed for consideration and, in the event that such proposal or business includes a proposal to amend the by-laws of the Corporation, the text of the proposed amendment), and (iii) a description of all agreements, arrangements and understandings between such stockholder and beneficial owner, if any, and any other person or persons (including their names) in connection with the proposal of such business by such stockholder;

 

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(3)                                  As to each person, if any, whom the stockholder proposes to nominate for election or reelection to the Board of Directors, a stockholder’s notice must, in addition to the matters set forth in paragraph (a) above, also set forth:  (i) all information relating to such person that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder (including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected) and (ii) a description of all direct and indirect compensation and other material monetary agreements, arrangements and understandings during the past three years, and any other material relationships, between or among such stockholder and beneficial owner, if any, and their respective affiliates and associates, or others acting in concert therewith, on the one hand, and each proposed nominee, and his or her respective affiliates and associates, or others acting in concert therewith, on the other hand, including, without limitation all information that would be required to be disclosed pursuant to Rule 404 or any successor provision promulgated under Regulation S-K if the stockholder making the nomination and any beneficial owner on whose behalf the nomination is made, if any, or any affiliate or associate thereof or person acting in concert therewith, were the “registrant” for purposes of such rule and the nominee were a director or executive officer of such registrant; and

 

(4)                                  With respect to each person, if any, whom the stockholder proposes to nominate for election or reelection to the Board of Directors, a stockholder’s notice must, in addition to the matters set forth in paragraphs (a) and (c) above, also include a completed and signed questionnaire, representation and agreement required by Section 2.9 of these By-laws.  The Corporation may require any proposed nominee to furnish such other information as may reasonably be required by the Corporation to determine the eligibility of such proposed nominee to serve as an independent director of the Corporation or that could be material to a reasonable stockholder’s understanding of the independence, or lack thereof, of such nominee.

 

(ii)                                   For purposes of these By-laws, “ public announcement ” shall mean disclosure in a press release reported by a national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act and the rules and regulations promulgated thereunder.

 

(iii)                                Notwithstanding the provisions of these By-laws, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this By-law; provided , however , that any references in these By-laws to the Exchange Act or the rules promulgated thereunder are not intended to and shall not limit the separate and additional requirements set forth in these By-laws with respect to nominations or proposals as to any other business to be considered pursuant to Section 2.7 of these By-laws.

 

(iv)                               Nothing in these By-laws shall be deemed to affect any rights (i) of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act or (ii) of the holders of any series of Preferred Stock if and to the extent provided for under law, the Certificate of Incorporation or these By-laws.  Subject to Rule 14a-8 under the Exchange Act, nothing in these By-laws shall be construed to permit any stockholder, or give any stockholder the right, to include or have disseminated or described in

 

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the Corporation’s proxy statement any nomination of director or directors or any other business proposal.

 

Section 2.9  Submission of Questionnaire, Representation and Agreement .  To be eligible to be a nominee for election or reelection as a director of the Corporation, a person nominated by a shareholder for election or reelection to the Board of Directors must deliver (in accordance with the time periods prescribed for delivery of notice under Section 2.8 of these By-laws) to the Secretary at the principal executive offices of the Corporation a written questionnaire with respect to the background and qualification of such person and the background of any other person or entity on whose behalf the nomination is being made (which questionnaire shall be provided by the Secretary upon written request), and a written representation and agreement (in the form provided by the Secretary upon written request) that such person (A) is not and will not become a party to (1) any agreement, arrangement or understanding with, and has not given any commitment or assurance to, any person or entity as to how such person, if elected as a director of the Corporation, will act or vote on any issue or question (a “ Voting Commitment ”) that has not been disclosed to the Corporation or (2) any Voting Commitment that could limit or interfere with such person’s ability to comply, if elected as a director of the Corporation, with such person’s fiduciary duties under applicable law, (B) is not and will not become a party to any agreement, arrangement or understanding with any person or entity other than the Corporation with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as a director that has not been disclosed therein, (C) will comply with the Corporation’s stock ownership guidelines for directors, if any, and has disclosed therein whether all or any portion of securities of the Corporation were purchased with any financial assistance provided by any other person and whether any other person has any interest in such securities, and (D) in such person’s individual capacity and on behalf of any person or entity on whose behalf the nomination is being made, would be in compliance, if elected as a director of the Corporation, and will comply, with all applicable corporate governance, conflict of interest, confidentiality and stock ownership and trading policies and guidelines of the Corporation publicly disclosed from time to time, and (E) will abide by the requirements of Section 2.10 of these By-laws.

 

Section 2.10  Procedure for Election of Directors; Required Vote .

 

(A)                                Except as set forth below, election of directors at all meetings of the stockholders at which directors are to be elected shall be by ballot, and, subject to the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances, a majority of the votes cast at any meeting for the election of directors at which a quorum is present shall elect directors.  For purposes of this By-law, a majority of votes cast shall mean that the number of shares voted “for” a director’s election exceeds 50% of the number of votes cast with respect to that director’s election.  Votes cast shall include direction to withhold authority in each case and exclude abstentions with respect to that director’s election.  Notwithstanding the foregoing, in the event of a “contested election” of directors, directors shall be elected by the vote of a plurality of the votes cast at any meeting for the election of directors at which a quorum is present.  For purposes of this By-law, a “contested election” shall mean any election of directors in which the number of candidates for election as directors exceeds the number of directors to be elected, with the determination thereof being made by the Secretary as of the close of the applicable notice of nomination period set forth in Section 2.8 of these

 

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By-laws or under applicable law, based on whether one or more notice(s) of nomination were timely filed in accordance with said Section 2.8; provided , however , that the determination that an election is a “contested election” shall be determinative only as to the timeliness of a notice of nomination and not otherwise as to its validity.  If, prior to the time the Corporation mails its initial proxy statement in connection with such election of directors, one or more notices of nomination are withdrawn such that the number of candidates for election as director no longer exceeds the number of directors to be elected, the election shall not be considered a contested election, but in all other cases, once an election is determined to be a contested election, directors shall be elected by the vote of a plurality of the votes cast.

 

(B)                                If a nominee for director who is an incumbent director is not elected and no successor has been elected at such meeting, the director shall promptly tender his or her resignation to the Board of Directors in accordance with the agreement contemplated by clause (E) of Section 2.9 of these By-laws.  The Nominations and Governance Committee shall make a recommendation to the Board of Directors as to whether to accept or reject the tendered resignation, or whether other action should be taken.  The Board of Directors shall act on the tendered resignation, taking into account the Nominations and Governance Committee’s recommendation, and publicly disclose (by a press release, a filing with the Securities and Exchange Commission or other broadly disseminated means of communication) its decision regarding the tendered resignation and the rationale behind the decision within 90 days from the date of the certification of the election results.  The Nominations and Governance Committee in making its recommendation, and the Board of Directors in making its decision, may each consider any factors or other information that it considers appropriate and relevant.  The director who tenders his or her resignation shall not participate in the recommendation of the Nominations and Governance Committee or the decision of the Board of Directors with respect to his or her resignation.  If such incumbent director’s resignation is not accepted by the Board of Directors, such director shall continue to serve until the next annual meeting and until his or her successor is duly elected, or his or her earlier resignation or removal.  If a director’s resignation is accepted by the Board of Directors pursuant to this By-law, or if a nominee for director is not elected and the nominee is not an incumbent director, then the Board of Directors, in its sole discretion, may fill any resulting vacancy pursuant to the provisions of Section 3.9 of these By-laws or may decrease the size of the Board of Directors pursuant to the provisions of Section 3.2 of these By-laws.

 

(C)                                Except as otherwise provided by law, the Certificate of Incorporation, or these By-laws, in all matters other than the election of directors, the affirmative vote of a majority of the shares present in person or represented by proxy at the meeting and entitled to vote on the matter shall be the act of the stockholders.

 

Section 2.11  Inspectors of Elections; Opening and Closing the Polls .

 

(A)                                The Board of Directors by resolution shall appoint one or more inspectors, which inspector or inspectors may, but does not need to, include individuals who serve the Corporation in other capacities, including, without limitation, as officers, employees, agents or representatives, to act at the meetings of stockholders and make a written report thereof.  One or more persons may be designated as alternate inspectors to replace any inspector who fails to act.  If no inspector or alternate has been appointed to act or is able to act at a

 

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meeting of stockholders, the Chairman of the meeting shall appoint one or more inspectors to act at the meeting.  Each inspector, before discharging his or her duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability.  The inspectors shall have the duties prescribed by law.

 

(B)                                The Chairman of the meeting shall be appointed by the inspector or inspectors to fix and announce at the meeting the date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting.

 

Section 2.12  No Stockholder Action by Written Consent .  Subject to the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, any action required or permitted to be taken by the stockholders of the Corporation must be effected at an annual or special meeting of stockholders of the Corporation and may not be effected by any consent in writing by such stockholders.

 

ARTICLE III
BOARD OF DIRECTORS

 

Section 3.1  General Powers .  The business and affairs of the Corporation shall be managed under the direction of the Board of Directors.  In addition to the powers and authorities by these By-laws expressly conferred upon them, the Board of Directors may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these By-laws required to be exercised or done by the stockholders.

 

Section 3.2  Number, Tenure and Qualifications .  Subject to the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances, the number of directors shall be fixed from time to time exclusively pursuant to a resolution adopted by a majority of the Whole Board.  No decrease in the number of authorized directors constituting the Whole Board shall shorten the term of any incumbent director.

 

Section 3.3  Classes of Directors .  Subject to the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances, the directors shall be divided, with respect to the time for which they severally hold office, into three classes, as nearly equal in number as is reasonably possible, with the term of office of the first class to expire at the 2013 annual meeting of stockholders, the term of office of the second class to expire at the 2014 annual meeting of stockholders and the term of office of the third class to expire at the 2015 annual meeting of stockholders, with each director to hold office until his or her successor shall have been duly elected and qualified.  At each annual meeting of stockholders, commencing with the 2013 annual meeting, (a) directors elected to succeed those directors whose terms then expire shall be elected for a term of office to expire at the third succeeding annual meeting of stockholders after their election, with each director to hold office until his or her successor shall have been duly elected and qualified, and (b) if authorized by a resolution of the Board of Directors, directors may be elected to fill any vacancy on the Board of Directors, regardless of how such vacancy shall have been created.

 

Section 3.4  Regular Meetings .  A regular meeting of the Board of Directors shall

 

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be held without other notice than this By-law immediately after, and at the same place as, the Annual Meeting of Stockholders.  The Board of Directors may, by resolution, provide the time and place for the holding of additional regular meetings without other notice than such resolution.

 

Section 3.5  Special Meetings .  Special meetings of the Board of Directors shall be called at the request of the Chairman of the Board of Directors, the Chief Executive Officer or a majority of the Board of Directors then in office.  The person or persons authorized to call special meetings of the Board of Directors may fix the place and time of the meetings.

 

Section 3.6  Notice .  Notice of any special meeting of directors shall be given to each director at his or her business or residence in writing by hand delivery, first-class or overnight mail or courier service, telegram, email or facsimile transmission, or orally by telephone.  If mailed by first-class mail, such notice shall be deemed adequately delivered when deposited in the United States mails so addressed, with postage thereon prepaid, at least five (5) days before such meeting.  If by telegram, overnight mail or courier service, such notice shall be deemed adequately delivered when the telegram is delivered to the telegraph company, or the notice is delivered to the overnight mail or courier service company at least twenty-four (24) hours before such meeting.  If by email, facsimile transmission, telephone or by hand, such notice shall be deemed adequately delivered when the notice is transmitted at least twelve (12) hours before such meeting.  Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the notice of such meeting, except for amendments to these By-laws, as provided under Section 10.1 of these By-laws.  A meeting may be held at any time without notice if all the directors are present or if those not present waive notice of the meeting in accordance with Section 8.4 of these By-laws.

 

Section 3.7  Action by Consent of Board of Directors .  Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing or by electronic transmission, and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the Board or committee.  Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

 

Section 3.8  Conference Telephone Meetings .  Members of the Board of Directors, or any committee thereof, may participate in a meeting of the Board of Directors or such committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at such meeting.

 

Section 3.9  Quorum .  Subject to Section 3.9 of these By-laws, a whole number of directors equal to at least a majority of the Whole Board shall constitute a quorum for the transaction of business, but if at any meeting of the Board of Directors there shall be less than a quorum present, a majority of the directors present may adjourn the meeting from time to time without further notice.  The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors.  The directors present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal

 

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of enough directors to leave less than a quorum.

 

Section 3.10  Vacancies .  Subject to applicable law and the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, and unless the Board of Directors otherwise determines, vacancies resulting from death, resignation, retirement, disqualification, removal from office or other cause, and newly created directorships resulting from any increase in the authorized number of directors, may be filled only by the affirmative vote of a majority of the remaining directors, though less than a quorum of the Board of Directors, and in the event that there is only one director remaining in office, by such sole remaining director, and directors so chosen shall hold office for a term expiring at the annual meeting of stockholders at which the term of office of the class to which they have been appointed expires and until such director’s successor shall have been duly elected and qualified.

 

Section 3.11  Removal .  Subject to the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, any director, or the entire Board of Directors, may be removed from office at any time, but only for cause and only by the affirmative vote of the holders of a majority of the outstanding shares of Voting Stock, voting together as a single class.

 

Section 3.12  Records .  The Board of Directors shall cause to be kept a record containing the minutes of the proceedings of the meetings of the Board of Directors and of the stockholders, appropriate stock books and registers and such books of records and accounts as may be necessary for the proper conduct of the business of the Corporation.

 

ARTICLE IV
COMMITTEES

 

Section 4.1  Appointment .  A majority of the Board of Directors may create one or more committees and appoint members of the Board of Directors to serve on the committee or committees.  Each committee shall have one or more members, who serve at the pleasure of the Board of Directors.  The Board of Directors shall designate one member of each committee to be chairman of the committee.  The Board of Directors shall designate a secretary of each committee who may be, but need not be, a member of the committee or the Board of Directors.  Any committee, to the extent permitted by law and provided in the resolution establishing such committee, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it.  Each committee shall keep regular minutes and report to the Board of Directors when required.

 

Section 4.2  Committee Meetings .  A majority of any committee shall constitute a quorum and the act of the majority of the members of a committee present at a meeting at which a quorum is present shall be the act of such committee.  A committee may act by unanimous consent in writing without a meeting.  Committee meetings may be called by the Chairman of the Board of Directors, the chairman of the committee, or any two of the committee’s members. The time and place of committee meetings shall be designated in the notice of such meeting.  Notice of each committee meeting shall be given to each committee member.  Each Committee shall keep minutes of its proceedings.

 

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Section 4.3  Executive Committee .  The Board of Directors shall appoint an Executive Committee.  A majority of the members of the Executive Committee shall be selected from those Directors who satisfy the independence requirements of the Corporation’s Corporate Governance Guidelines.  The Executive Committee may exercise, subject to applicable provisions of law, all the powers of the Board of Directors in the management of the business and affairs of the Corporation when the Board of Directors is not in session.

 

Section 4.4  Audit Committee .  The Board of Directors shall appoint an Audit Committee.  The composition of the members and the duties of such committee shall be as set forth in the Audit Committee Charter.

 

Section 4.5  Compensation Committee .  The Board of Directors shall appoint a Compensation Committee.  The composition of the members and the duties of such committee shall be as set forth in the Compensation Committee Charter.

 

Section 4.6  Nominations and Governance Committee .  The Board of Directors shall appoint a Nominations and Governance Committee.  The composition of the members and the duties of such committee shall be as set forth in the Nominations and Governance Committee Charter.

 

Section 4.7  Public Policy Committee .  The Board of Directors shall appoint a Public Policy Committee.  The composition of the members and the duties of such committee shall be as set forth in the Public Policy Committee Charter.

 

ARTICLE V
OFFICERS

 

Section 5.1  Officers .  The officers of the Corporation (“ Officers ”) shall be the Chairman of the Board of Directors, the Chief Executive Officer, one or more Presidents, one or more Executive, Group or Senior Vice Presidents, one or more Vice Presidents, a Treasurer, a Secretary, a Controller, a General Counsel and such Assistant Treasurers and Assistant Secretaries as the Board of Directors may elect or the Chairman of the Board may appoint.  Any two offices may be held by the same person.

 

Section 5.2  Election and Term of Office .  The Board of Directors may elect any Officer.  The Chairman of the Board may appoint any Vice President, a Controller, a Treasurer, a Secretary and any Assistant Treasurers and Assistant Secretaries.  The Officers of the Corporation shall be elected or appointed annually.  Each year, the Board of Directors shall elect Officers at the first meeting of the Board of Directors held after the annual meeting of shareholders.  If the Board of Directors does not elect Officers at such meeting, such election shall be held as soon thereafter as conveniently may be.  Each year, immediately following the election of Officers by the Board of Directors or as soon thereafter as conveniently may be, the Chairman of the Board shall appoint such additional Officers within the scope of the Chairman’s authority as the Chairman deems necessary or appropriate.  Vacancies or new offices may be filled at any time as set forth in Section 5.4 of this Article V.  Each Officer shall hold office until his or her successor shall have been duly elected or appointed and shall have qualified or until his or her death or until he or she shall resign or shall have been removed in the manner hereinafter provided.

 

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Section 5.3  Removal of Officers .  Any Officer may be removed by the Board of Directors whenever in its judgment the best interests of the Corporation will be served thereby.  Any Officer appointed by the Chairman of the Board may be removed by the Chairman whenever, in the Chairman’s judgment, the best interests of the Corporation will be served thereby.

 

Section 5.4  Vacancies .  A vacancy in any office because of death, resignation, removal, disqualification or otherwise, may be filled by the Board of Directors for the unexpired portion of the term.  A vacancy in any office appointed by the Chairman of the Board may be filled by the Chairman of the Board for the unexpired portion of the term.

 

Section 5.5  Chairman of the Board of Directors; Chief Executive Officer .  The Chairman shall preside at all meetings of the Board of Directors and the shareholders.  The Chief Executive Officer shall be responsible for the overall management of the Corporation subject to the direction of the Board of Directors.

 

Section 5.6  President .  Each President shall be the Chief Operating Officer of a major area of the Corporation’s activities and shall perform such duties as may be prescribed by the Board of Directors or the Chief Executive Officer.

 

Section 5.7  Executive, Group and Senior Vice Presidents .  Each Executive, Group, or Senior Vice President shall be responsible for supervising and coordinating a major area of the Corporation’s activities subject to the direction of the Chief Executive Officer or a President.

 

Section 5.8  Vice Presidents .  Each of the Vice Presidents shall be responsible for those activities designated by an Executive, Group, or Senior Vice President, a President, the Chief Executive Officer, or the Board of Directors.

 

Section 5.9  Treasurer .  The Treasurer shall administer the investment, financing, insurance and credit activities of the Corporation.

 

Section 5.10  Secretary .  The Secretary will be the custodian of the corporate records and of the seal of the Corporation, will countersign certificates for shares of the Corporation, and in general will perform all duties incident to the office of the Secretary.  The Secretary shall have the authority to certify the By-laws, resolutions of the shareholders and the Board of Directors and committees thereof, and other documents of the Corporation as true and correct copies hereof.

 

Section 5.11  Controller .  The Controller will conduct the accounting activities of the Corporation, including the maintenance of the Corporation’s general and supporting ledgers and books of account, operating budgets, and the preparation and consolidation of financial statements.

 

Section 5.12  General Counsel .  The General Counsel will be the chief consultant of the Corporation on legal matters and will supervise all matters of legal import concerning the interests of the Corporation.

 

Section 5.13  Assistant Treasurer .  The Assistant Treasurer shall, in the absence or

 

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incapacity of the Treasurer, perform the duties and exercise the powers of the Treasurer, and shall perform such other duties as shall from time to time be given to him or her by the Treasurer.

 

Section 5.14  Assistant Secretary .  The Assistant Secretary shall, in the absence or incapacity of the Secretary, perform the duties and exercise the powers of the Secretary, and shall perform such other duties as shall from time to time be given to him or her by the Secretary.  The Assistant Secretary shall be, with the Secretary, keeper of the books, records, and the seal of the Corporation, and shall have the authority to certify the By-laws, resolutions and other documents of the Corporation.

 

Section 5.15  General Powers of Officers .  The Chairman of the Board, the Chief Executive Officer, any President, and any Executive, Group or Senior Vice President, may sign without countersignature any deeds, mortgages, bonds, contracts, reports to public agencies, or other instruments whether or not the Board of Directors has expressly authorized execution of such instruments, except in cases where the signing and execution thereof shall be expressly delegated by the Board of Directors or by these By-laws solely to some other Officer or agent of the Corporation, or shall be required by law to be otherwise signed or executed.  Any other Officer of this Corporation may sign contracts, reports to public agencies, or other instruments which are in the regular course of business and within the scope of his or her authority, except where signing and execution thereof shall be expressly delegated by the Board of Directors or by these By-laws to some other Officer or agent of the Corporation, or shall be required by law to be otherwise signed or executed.

 

ARTICLE VI
STOCK CERTIFICATES AND TRANSFERS

 

Section 6.1  Certificated and Uncertificated Stock; Transfers .  The interest of each stockholder of the Corporation may be evidenced by certificates for shares of stock in such form as the appropriate officers of the Corporation may from time to time prescribe or be uncertificated.

 

The shares of the stock of the Corporation shall be transferred on the books of the Corporation, in the case of certificated shares of stock, by the holder thereof in person or by his or her attorney duly authorized in writing, upon surrender for cancellation of certificates for at least the same number of shares, with an assignment and power of transfer endorsed thereon or attached thereto, duly executed, with such proof of the authenticity of the signature as the Corporation or its agents may reasonably require; and, in the case of uncertificated shares of stock, upon receipt of proper transfer instructions from the registered holder of the shares or by such person’s attorney duly authorized in writing, and upon compliance with appropriate procedures for transferring shares in uncertificated form.  No transfer of stock shall be valid as against the Corporation for any purpose until it shall have been entered in the stock records of the Corporation by an entry showing from and to whom transferred.

 

The certificates of stock shall be signed, countersigned and registered in such manner as the Board of Directors may by resolution prescribe, which resolution may permit all or any of the

 

15



 

signatures on such certificates to be in facsimile.  In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.

 

Notwithstanding anything to the contrary in these By-laws, at all times that the Corporation’s stock is listed on a stock exchange, the shares of the stock of the Corporation shall comply with all direct registration system eligibility requirements established by such exchange, including any requirement that shares of the Corporation’s stock be eligible for issue in book-entry form.  All issuances and transfers of shares of the Corporation’s stock shall be entered on the books of the Corporation with all information necessary to comply with such direct registration system eligibility requirements, including the name and address of the person to whom the shares of stock are issued, the number of shares of stock issued and the date of issue.  The Board of Directors shall have the power and authority to make such rules and regulations as it may deem necessary or proper concerning the issue, transfer and registration of shares of stock of the Corporation in both the certificated and uncertificated form.

 

Section 6.2  Lost, Stolen or Destroyed Certificates .  No certificate for shares of stock in the Corporation shall be issued in place of any certificate alleged to have been lost, destroyed or stolen, except on production of such evidence of such loss, destruction or theft and on delivery to the Corporation of a bond of indemnity in such amount, upon such terms and secured by such surety, as the Board of Directors or any financial officer may in its or his or her discretion require.

 

Section 6.3  Record Owners .  The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise required by law.

 

Section 6.4  Transfer and Registry Agents .  The Corporation may from time to time maintain one or more transfer offices or agencies and registry offices or agencies at such place or places as may be determined from time to time by the Board of Directors.

 

ARTICLE VII
INDEMNIFICATION

 

Section 7.1  Indemnification .

 

(A)                                Each person who was or is made a party or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “ Proceeding ”), by reason of the fact that he or she or a person of whom he or she is the legal representative is or was, at any time during which this By-law is in effect (whether or not such person continues to serve in such capacity at the time any indemnification or advancement of expenses pursuant hereto is sought or at the time

 

16



 

any Proceeding relating thereto exists or is brought), a director or officer of the Corporation or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, trustee, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans maintained or sponsored by the Corporation (hereinafter, a “ Covered Person ”), whether the basis of such Proceeding is alleged action in an official capacity as a director or officer or while serving as a director, officer, trustee, employee or agent, shall be indemnified and held harmless by the Corporation (and any successor of the Corporation by merger or otherwise) to the fullest extent authorized by the DGCL as the same exists or may hereafter be amended or modified from time to time (but, in the case of any such amendment or modification, only to the extent that such amendment or modification permits the Corporation to provide greater indemnification rights than said law permitted the Corporation to provide prior to such amendment or modification), against all expense, liability and loss (including attorneys’ fees, judgments, fines, excise taxes or penalties (including those arising under the Employee Retirement Income Security Act of 1974) and amounts paid or to be paid in settlement) actually and reasonably incurred or suffered by such Covered Person in connection with such Proceeding and such indemnification shall continue as to a person who has ceased to be a director, officer, trustee, employee or agent and shall inure to the benefit of his or her heirs, executors and administrators; provided , however , that except as provided in paragraph (A) of Section 7.3, the Corporation shall not be required to indemnify any such person (or his or her heirs, executors or personal or legal representatives) seeking indemnification in connection with a Proceeding (or part thereof) initiated by such person unless such Proceeding (or part thereof) was authorized or consented to by the Board of Directors.

 

(B)                                To obtain indemnification under this By-law, a claimant shall submit to the Corporation a written request, including therein or therewith such documentation and information as is reasonably available to the claimant and is reasonably necessary to determine whether and to what extent the claimant is entitled to indemnification.  Upon written request by a claimant for indemnification, a determination, if required by applicable law, with respect to the claimant’s entitlement thereto shall be made as follows:  (1) if requested by the claimant, by Independent Counsel (as hereinafter defined), or (2) if no request is made by the claimant for a determination by Independent Counsel, (i) by the Board of Directors by a majority vote of a quorum consisting of Disinterested Directors (as hereinafter defined), or (ii) if a quorum of the Board of Directors consisting of Disinterested Directors is not obtainable or, even if obtainable, such quorum of Disinterested Directors so directs, by Independent Counsel in a written opinion to the Board of Directors, a copy of which shall be delivered to the claimant, or (iii) if a quorum of Disinterested Directors so directs, by a majority vote of the stockholders of the Corporation.  In the event the determination of entitlement to indemnification is to be made by Independent Counsel, the Independent Counsel shall be selected by the Board of Directors unless there shall have occurred within two years prior to the date of the commencement of the Proceeding for which indemnification is claimed a “Change in Control” as

 

17



 

defined in the AbbVie 2013 Incentive Stock Program, in which case the Independent Counsel shall be selected by the claimant unless the claimant shall request that such selection be made by the Board of Directors.  If it is so determined that the claimant is entitled to indemnification, payment to the claimant shall be made within ten (10) days after such determination.

 

Section 7.2  Mandatory Advancement of Expenses .  To the fullest extent authorized by the DGCL as the same exists or may hereafter be amended or modified from time to time (but, in the case of any such amendment or modification, only to the extent that such amendment or modification permits the Corporation to provide greater rights to advancement of expenses than said law permitted the Corporation to provide prior to such amendment or modification), each Covered Person shall have (and shall be deemed to have a contractual right to have) the right, without the need for any action by the Board of Directors, to be paid by the Corporation (and any successor of the Corporation by merger or otherwise) the expenses incurred in connection with any Proceeding in advance of its final disposition, such advances to be paid by the Corporation within twenty (20) days after the receipt by the Corporation of a statement or statements from the claimant requesting such advance or advances from time to time; provided , however , that if the DGCL requires, the payment of such expenses incurred by a director or officer in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered by such person while a director or officer, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking (hereinafter, the “ Undertaking ”) by or on behalf of such director or officer, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right of appeal (a “ final disposition ”) that such director or officer is not entitled to be indemnified for such expenses under this By-law or otherwise.

 

Section 7.3  Claims .

 

(A)                                (1) If a claim for indemnification under this Article VII is not paid in full by the Corporation within thirty (30) days after a written claim pursuant to Section 7.1(B) of these By-laws has been received by the Corporation, or (2) if a request for advancement of expenses under this Article VII is not paid in full by the Corporation within twenty (20) days after a statement pursuant to Section 7.2 of these By-laws and the required Undertaking, if any, have been received by the Corporation, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim for indemnification or request for advancement of expenses and, if successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such claim.  It shall be a defense to any such action that, under the DGCL, the claimant has not met the standard of conduct which makes it permissible for the Corporation to indemnify the claimant for the amount claimed or that the claimant is not entitled to the requested advancement of expenses, but (except where the required Undertaking, if any, has not been tendered to the Corporation) the burden of proving

 

18



 

such defense shall be on the Corporation.  Neither the failure of the Corporation (including its Board of Directors, Independent Counsel or stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including its Board of Directors, Independent Counsel or stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.

 

(B)                                If a determination shall have been made pursuant to Section 7.1(B) of these By-laws that the claimant is entitled to indemnification, the Corporation shall be bound by such determination in any judicial proceeding commenced pursuant to paragraph (A) of this Section 7.3.

 

(C)                                The Corporation shall be precluded from asserting in any judicial proceeding commenced pursuant to paragraph (A) of this Section 7.3 that the procedures and presumptions of this By-law are not valid, binding and enforceable and shall stipulate in such proceeding that the Corporation is bound by all the provisions of this By-law.

 

Section 7.4  Contract Rights; Amendment and Repeal; Non-exclusivity of Rights .

 

(A)                                All of the rights conferred in this Article VII, as to indemnification, advancement of expenses and otherwise, shall be contract rights between the Corporation and each Covered Person to whom such rights are extended that vest at the commencement of such Covered Person’s service to or at the request of the Corporation and (x) any amendment or modification of this Article VII that in any way diminishes or adversely affects any such rights shall be prospective only and shall not in any way diminish or adversely affect any such rights with respect to any actual or alleged state of facts, occurrence, action or omission occurring prior to the time of such amendment or modification, or Proceeding previously or thereafter brought or threatened based in whole or in part upon any such actual or alleged state of facts, occurrence, action or omission, and (y) all of such rights shall continue as to any such Covered Person who has ceased to be a director or officer of the Corporation or ceased to serve at the Corporation’s request as a director, officer, trustee, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, as described herein, and shall inure to the benefit of such Covered Person’s heirs, executors and administrators.

 

(B)                                All of the rights conferred in this Article VII, as to indemnification, advancement of expenses and otherwise, (i) shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, By-laws, agreement, vote of stockholders or Disinterested Directors or otherwise and (ii) cannot be terminated by the Corporation, the Board of Directors or the stockholders of the Corporation with respect to a person’s service prior to the date of such termination.

 

Section 7.5  Insurance, Other Indemnification and Advancement of Expenses .

 

(A)                                The Corporation may maintain insurance, at its expense, to protect itself and any current or former director, officer, employee or agent of the Corporation or another

 

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corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the DGCL.  To the extent that the Corporation maintains any policy or policies providing such insurance, each such current or former director or officer, and each such agent or employee to which rights to indemnification have been granted as provided in paragraph (B) of this Section 7.5, shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage thereunder for any such current or former director, officer, employee or agent.

 

(B)                                The Corporation may, to the extent authorized from time to time by the Board of Directors or the Chief Executive Officer, grant rights to indemnification and rights to advancement of expenses incurred in connection with any Proceeding in advance of its final disposition, to any current or former employee or agent of the Corporation to the fullest extent of the provisions of this By-law with respect to the indemnification and advancement of expenses of current or former directors and officers of the Corporation.

 

Section 7.6  Definitions .  For purposes of this By-law:

 

(A)                                Disinterested Director ” means a director of the Corporation who is not and was not a party to the matter in respect of which indemnification is sought by the claimant.

 

(B)                                Independent Counsel ” means a law firm, a member of a law firm, or an independent practitioner, that is experienced in matters of corporation law and shall include any person who, under the applicable standards of professional conduct then prevailing, would not have a conflict of interest in representing either the Corporation or the claimant in an action to determine the claimant’s rights under this By-law.

 

Section 7.7  Notice .  Any notice, request or other communication required or permitted to be given to the Corporation under this By-law shall be in writing and either delivered in person or sent by telecopy, telex, telegram, overnight mail or courier service, or certified or registered mail, postage prepaid, return receipt requested, to the Secretary of the Corporation and shall be effective only upon receipt by the Secretary.

 

Section 7.8  Severability .  If any provision or provisions of this By-law shall be held to be invalid, illegal or unenforceable for any reason whatsoever:  (1) the validity, legality and enforceability of the remaining provisions of this By-law (including, without limitation, each portion of any paragraph of this By-law containing any such provision held to be invalid, illegal or unenforceable, that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (2) to the fullest extent possible, the provisions of this By-law (including, without limitation, each such portion of any paragraph of this By-law containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.

 

ARTICLE VIII
MISCELLANEOUS PROVISIONS

 

Section 8.1  Fiscal Year .  The fiscal year of the Corporation shall begin on the

 

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first day of January and end on the thirty-first day of December of each year.

 

Section 8.2  Dividends .  The Board of Directors may from time to time declare, and the Corporation may pay, dividends on its outstanding shares in the manner and upon the terms and conditions provided by law and the Certificate of Incorporation.

 

Section 8.3  Seal .  The corporate seal shall have enscribed thereon the words “Corporate Seal”, the year of incorporation and around the margin thereof the words “AbbVie Inc. - Delaware.”

 

Section 8.4  Waiver of Notice .  Whenever any notice is required to be given to any stockholder or director of the Corporation under the provisions of the DGCL or these By-laws, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.  Neither the business to be transacted at, nor the purpose of, any annual or special meeting of the stockholders or the Board of Directors or committee thereof need be specified in any waiver of notice of such meeting.

 

Section 8.5  Audits .  The accounts, books and records of the Corporation shall be audited upon the conclusion of each fiscal year by an independent certified public accountant selected by the Board of Directors, and it shall be the duty of the Board of Directors to cause such audit to be done annually.

 

Section 8.6  Resignations .  Any director or any officer, whether elected or appointed, may resign at any time by giving written notice of such resignation to the Chairman of the Board, the President, or the Secretary, and such resignation shall be deemed to be effective as of the close of business on the date said notice is received by the Chairman of the Board, the President, or the Secretary, or at such later time as is specified therein.  No formal action shall be required of the Board of Directors or the stockholders to make any such resignation effective.

 

ARTICLE IX
CONTRACTS, PROXIES, ETC.

 

Section 9.1  Contracts .  Except as otherwise required by law, the Certificate of Incorporation or these By-laws, any contracts or other instruments may be executed and delivered in the name and on the behalf of the Corporation by such officer or officers of the Corporation as the Board of Directors may from time to time direct.  Such authority may be general or confined to specific instances as the Board may determine.  The Chairman of the Board, the Chief Executive Officer, any President, and any Executive, Group or Senior Vice President may execute bonds, contracts, deeds, leases and other instruments to be made or executed for or on behalf of the Corporation.  Subject to any restrictions imposed by the Board of Directors or the Chairman of the Board, the President or any Vice President of the Corporation may delegate contractual powers to others under his or her jurisdiction, it being understood, however, that any such delegation of power shall not relieve such officer of responsibility with respect to the exercise of such delegated power.

 

Section 9.2  Proxies .  Unless otherwise provided by resolution adopted by the Board of Directors, the Chairman of the Board, the Chief Executive Officer, a President, an Executive,

 

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Group or Senior Vice President may from time to time appoint an attorney or attorneys or agent or agents of the Corporation, in the name and on behalf of the Corporation, to cast the votes which the Corporation may be entitled to cast as the holder of stock or other securities in any other corporation, any of whose stock or other securities may be held by the Corporation, at meetings of the holders of the stock or other securities of such other corporation, or to consent in writing, in the name of the Corporation as such holder, to any action by such other corporation, and may instruct the person or persons so appointed as to the manner of casting such votes or giving such consent, and may execute or cause to be executed in the name and on behalf of the Corporation and under its corporate seal or otherwise, all such written proxies or other instruments as he or she may deem necessary or proper in the premises.

 

ARTICLE X
AMENDMENTS

 

Section 10.1  Amendments .  These By-laws may be altered, amended or repealed, in whole or in part, and new By-laws may be adopted (i) by the affirmative vote of the shares representing a majority of the votes entitled to be cast by the Voting Stock; provided , however , that any proposed alteration, amendment or repeal of, or the adoption of any By-law inconsistent with, Section 2.2, 2.12, 3.2, 3.3, 3.10 or 3.11, Article VII or this Article X of these By-laws (in each case, as in effect on the date hereof), by the stockholders shall require the affirmative vote of shares representing not less than eighty percent (80%) of the votes entitled to be cast by the Voting Stock; and provided further , however , that in the case of any such stockholder action at a meeting of stockholders, notice of the proposed alteration, amendment, repeal or adoption of the new By-law or By-laws must be contained in the notice of such meeting, or (ii) by action of the Board of Directors of the Corporation; provided , however , that the case of any such action at a meeting of the Board of Directors, notice of the proposed alteration, amendment, repeal or adoption of the new By-law or By-laws must be given not less than two days prior to the meeting.  The provisions of this Section 10.1 are subject to any provisions requiring a greater vote that are set forth in the Certificate of Incorporation.

 

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Exhibit 10.1

 

EXECUTION VERSION

 

U.S. TRANSITION SERVICES AGREEMENT

 

BY AND BETWEEN

 

ABBOTT LABORATORIES

 

AND

 

ABBVIE INC.

 

DATED AS OF DECEMBER 31, 2012

 



 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE I DEFINITIONS

1

 

 

 

Section 1.01.

Definitions

1

 

 

 

ARTICLE II SERVICES

4

 

 

 

Section 2.01.

Initial Services

4

Section 2.02.

Omitted Services; Excluded Services; Additional Services

4

Section 2.03.

Performance of Services

5

Section 2.04.

Charges for Services

7

Section 2.05.

Reimbursement for Out-of-Pocket Expenses

7

Section 2.06.

Changes to Services

7

Section 2.07.

Transitional Nature of Services

8

Section 2.08.

Use of Third Parties to Provide Services

8

 

 

 

ARTICLE III OTHER ARRANGEMENTS

9

 

 

Section 3.01.

Access

9

 

 

 

ARTICLE IV BILLING; TAXES

10

 

 

 

Section 4.01.

Procedure

10

Section 4.02.

Late Payments

10

Section 4.03.

Taxes

10

Section 4.04.

No Set-Off

10

 

 

 

ARTICLE V TERM AND TERMINATION

10

 

 

 

Section 5.01.

Term

10

Section 5.02.

Early Termination

11

Section 5.03.

Reduction of Services

11

Section 5.04.

Extension of Services

12

Section 5.05.

Interdependencies

12

Section 5.06.

Effect of Termination

13

Section 5.07.

Information Transmission

13

 

 

 

ARTICLE VI CONFIDENTIALITY; PROTECTIVE ARRANGEMENTS

13

 

 

 

Section 6.01.

Abbott and AbbVie Obligations

13

Section 6.02.

No Release

14

Section 6.03.

Third Party Information; Privacy and Data Protection Laws

14

Section 6.04.

Protective Arrangements

14

 

i



 

TABLE OF CONTENTS
(continued)

 

ARTICLE VII LIMITED LIABILITY AND INDEMNIFICATION

15

 

 

 

Section 7.01.

Limitations on Liability

15

Section 7.02.

Obligation to Re-Perform; Liabilities

16

Section 7.03.

Third Party Claims

16

Section 7.04.

Indemnification Procedures

16

 

 

 

ARTICLE VIII TRANSITION COMMITTEE

16

 

 

Section 8.01.

Establishment

16

 

 

 

ARTICLE IX MISCELLANEOUS

16

 

 

Section 9.01.

Mutual Cooperation

16

Section 9.02.

Title to Intellectual Property

17

Section 9.03.

Force Majeure

17

Section 9.04.

Independent Contractors

17

Section 9.05.

Third Party Beneficiaries

17

Section 9.06.

Governing Law

18

Section 9.07.

Dispute Resolution

18

Section 9.08.

Specific Performance

18

Section 9.09.

Interpretation

19

Section 9.10.

Headings

19

Section 9.11.

Amendment

19

Section 9.12.

Assignability

19

Section 9.13.

Audit Assistance

20

Section 9.14.

Survival of Covenants

20

Section 9.15.

Subsidiaries

20

Section 9.16.

Waivers of Default

20

Section 9.17.

Notices

20

Section 9.18.

Counterparts

21

Section 9.19.

Entire Agreement

21

Section 9.20.

Corporate Power

21

Section 9.21.

Signatures and Delivery

21

Section 9.22.

Severability

21

Section 9.23.

Further Assurances

22

Section 9.24.

Public Announcements

22

Section 9.25.

Mutual Drafting

22

 

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THIS U.S. TRANSITION SERVICES AGREEMENT, dated as of December 31, 2012, is by and between ABBOTT LABORATORIES, an Illinois corporation (“ Abbott ”), and ABBVIE INC., a Delaware corporation (“ AbbVie ”).

 

R E C I T A L S :

 

WHEREAS, the board of directors of Abbott has determined that it is appropriate and advisable to separate Abbott’s research-based pharmaceuticals business from its other businesses;

 

WHEREAS, in order to effectuate the foregoing, Abbott and AbbVie have entered into a Separation and Distribution Agreement, dated as of November 28, 2012 (the “ Separation and Distribution Agreement ”), which provides for, among other things, the contribution from Abbott to AbbVie of certain assets, the assumption by AbbVie of certain Liabilities (as defined in the Separation and Distribution Agreement) from Abbott, the distribution by Abbott of AbbVie common stock to Abbott shareholders, and the execution and delivery of certain agreements in order to facilitate and provide for the foregoing, in each case subject to the terms and conditions set forth therein; and

 

WHEREAS, in order to facilitate and provide for an orderly transition under the Separation and Distribution Agreement, the Parties (as defined herein) desire to enter into this Agreement to set forth the terms and conditions pursuant to which each of the Parties shall provide to the other the Services (as defined herein) for a transitional period.

 

NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this Agreement (as defined herein), the Parties hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

Section 1.01.                           Definitions .  Reference is made to Section 9.09 regarding the interpretation of certain words and phrases used in this Agreement.  In addition, for the purpose of this Agreement, the following terms shall have the meanings set forth below:

 

Abbott ” has the meaning set forth in the Preamble.

 

Abbott Subsidiary ” has the meaning set forth in the Separation and Distribution Agreement.

 

AbbVie ” has the meaning set forth in the Preamble.

 

AbbVie Subsidiary ” has the meaning set forth in the Separation and Distribution Agreement.

 

Additional Service ” has the meaning set forth in Section 2.02(c) .

 



 

Affiliate ” has the meaning set forth in the Separation and Distribution Agreement.

 

Agreement ” means this U.S. Transition Services Agreement and each of the Schedules and Exhibits hereto.

 

Change of Control ” has the meaning set forth in the Separation and Distribution Agreement.

 

Charges ” has the meaning set forth in Section 2.04 .

 

Dispute ” has the meaning set forth in Section 9.07(a) .

 

Effective Time ” has the meaning set forth in the Separation and Distribution Agreement.

 

Excluded Service ” has the meaning set forth in Section 2.02(b) .

 

Force Majeure ” has the meaning set forth in the Separation and Distribution Agreement.

 

Governmental Authority ” has the meaning set forth in the Separation and Distribution Agreement.

 

Information ” has the meaning set forth in the Separation and Distribution Agreement.

 

Initial Services ” has the meaning set forth in Section 2.01 .

 

Interest Payment ” has the meaning set forth in Section 4.02 .

 

Law ” has the meaning set forth in the Separation and Distribution Agreement.

 

Liabilities ” has the meaning set forth in the Separation and Distribution Agreement.

 

Notice ” means any written notice, request, demand or other communication specifically referencing this Agreement and given in accordance with Section 9.17 .

 

Omitted Service ” has the meaning set forth in Section 2.02(a) .

 

Parties ” means the parties to this Agreement.

 

Person ” has the meaning set forth in the Separation and Distribution Agreement.

 

Personal Data ” means data that can be used by itself or in combination with other available data to identify a specific individual.

 

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Prime Rate ” has the meaning set forth in the Separation and Distribution Agreement.

 

Privileged Information ” has the meaning set forth in the Separation and Distribution Agreement.

 

Proceeding ” has the meaning set forth in the Separation and Distribution Agreement.

 

Provider ” means, with respect to any Service, the entity or entities identified on the applicable subsection of Schedule 1 hereto as the “Service Provider.”

 

Provider Indemnitees ” has the meaning set forth in Section 7.03 .

 

Recipient ” means, with respect to any Service, the entity or entities identified on the applicable subsection of Schedule 1 hereto as the “Service Recipient.”

 

Reinstated Service ” has the meaning set forth in Section 2.02(b) .

 

Representatives ” has the meaning set forth in the Separation and Distribution Agreement.

 

Separation and Distribution Agreement ” has the meaning set forth in the Recitals.

 

Service Baseline Period ” has the meaning set forth in Section 2.03(c) .

 

Service Extension ” has the meaning set forth in Section 5.04(a) .

 

Service Period ” means, with respect to any Service, the period commencing on the later of (a) the Effective Time and (b) the date on which any Omitted Service, Excluded Service or Additional Service becomes a “Service” pursuant to the terms of this Agreement, and ending on the earlier of (i) the date the Recipient terminates the provision of such Service pursuant to Section 5.02 , and (ii) the termination date (measured as the number of months from the Effective Time) specified with respect to such Service on the subsection of Schedule 1 hereto applicable to such Service, unless extended pursuant to Section 5.04 .

 

Services ” means the Initial Services, Omitted Services, Reinstated Services and Additional Services.

 

Subsidiary ” has the meaning set forth in the Separation and Distribution Agreement.

 

Tax ” has the meaning set forth in the Separation and Distribution Agreement.

 

Tax Authority ” has the meaning set forth in the Separation and Distribution Agreement.

 

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Third Party ” has the meaning set forth in the Separation and Distribution Agreement.

 

Transition Committee ” has the meaning set forth in the Separation and Distribution Agreement.

 

ARTICLE II

 

SERVICES

 

Section 2.01.                           Initial Services Commencing as of the Effective Time, the Provider agrees to provide, or to cause one of its Subsidiaries to provide, to the Recipient, or any Subsidiary of the Recipient, the applicable services (the “ Initial Services ”) set forth on each of the subsections of Schedule 1 hereto.

 

Section 2.02.                           Omitted Services; Excluded Services; Additional Services .

 

(a)                                  If, following the Effective Time and during the term of this Agreement, a Party identifies a service that, prior to the Effective Time, the other Party or any of its Subsidiaries provided to the identifying Party or any of its Subsidiaries, but such service was inadvertently omitted from the Services set forth on Schedule 1 hereto (each such service, an “ Omitted Service ”), then the other Party shall use commercially reasonable efforts to provide, or to cause one of its Subsidiaries to provide, any such Omitted Service to the identifying Party and its Subsidiaries; provided that the other Party shall not be obligated to provide any Omitted Service if it does not, in its reasonable judgment, have adequate resources to provide such Omitted Service or if the provision of such Omitted Service would significantly disrupt the operation of its businesses.  The Parties shall cooperate and act in good faith to create a supplemental subsection of Schedule 1 hereto for each Omitted Service in the form attached hereto as Exhibit A and amend Schedule 1 hereto to include the Omitted Service.  Each supplemental subsection of Schedule 1 hereto, as agreed to in writing by the Parties, shall be deemed part of this Agreement as of the date of such agreement and the Omitted Services set forth therein shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

(b)                                  If, following the Effective Time and during the term of this Agreement, a Party identifies a service that, prior to the Effective Time, the other Party or any of its Subsidiaries provided to the identifying Party or any of its Subsidiaries, but the Parties had mutually agreed that such service would not be provided under the terms of this Agreement (each such service, an “ Excluded Service ”), then the Parties shall cooperate and act in good faith to determine whether the other Party shall provide such Excluded Service to the identifying Party or any of its Subsidiaries under the terms of this Agreement.  If the Parties determine that the other Party shall provide such Excluded Service to the identifying Party (each such Excluded Service, a “ Reinstated Service ”), then the Parties shall cooperate and act in good faith to create a supplemental subsection of Schedule 1 hereto for each Reinstated Service in the form attached hereto as Exhibit A and amend Schedule 1 hereto to include the Reinstated Service.  Each supplemental subsection of Schedule 1 hereto, as agreed in writing by the Parties, shall be deemed part of this Agreement as of the date of such agreement and the Reinstated Services set

 

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forth therein shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

(c)                                   If, following the Effective Time and during the term of this Agreement, a Party identifies a service, other than an Omitted Service or an Excluded Service, that it desires for the other Party or any of its Subsidiaries to provide to the identifying Party or any of its Subsidiaries (each such service, an “ Additional Service ”), then the other Party shall consider such request; provided that nothing shall require the other Party to provide such Additional Service to the identifying Party.  If the other Party consents to providing an Additional Service to the identifying Party, then the Parties shall cooperate and act in good faith to create a supplemental subsection of Schedule 1 hereto for each such Additional Service in the form attached hereto as Exhibit A and amend Schedule 1 hereto to include the Additional Service.  Each supplemental subsection of Schedule 1 hereto, as agreed to in writing by the Parties, shall be deemed part of this Agreement as of the date of such agreement and the Additional Services set forth therein shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

Section 2.03.                           Performance of Services .

 

(a)                                  The Provider shall perform and cause its Subsidiaries to perform all Services to be provided by the Provider in a manner that is based on its past practice and that is substantially similar in nature, quality and timeliness to the analogous services provided by Abbott or any of its Subsidiaries to Abbott or its applicable functional group or Subsidiary prior to the Effective Time.  The Provider shall, and shall cause its Subsidiaries to, perform its duties and responsibilities hereunder in good faith.  The Services shall be performed by the Provider and its Subsidiaries in the United States and Puerto Rico.

 

(b)                                  Nothing in this Agreement shall require the Provider to perform or cause to be performed any Service to the extent the manner of such performance would constitute a violation of applicable Laws, the Abbott Code of Business Conduct or any existing contract or agreement with a Third Party.  If the Provider is or becomes aware of any potential violation on the part of the Provider, the Provider shall use commercially reasonable efforts to promptly send a Notice to the Recipient of any such potential violation.  The Parties each agree to cooperate and use commercially reasonable efforts to obtain any necessary Third Party consents required under any existing contract or agreement with a Third Party to allow the Provider to perform or cause to be performed any Service in accordance with the standards set forth in this Section 2.03(b) .  Any costs and expenses incurred by any Party or any of its Subsidiaries in connection with obtaining any such Third Party consent that is required to allow the Provider to perform or cause to be performed (i) any Service (other than an Additional Service) shall be split between the Provider and the Recipient in accordance with such Parties’ respective utilization of the applicable Service at such time (except with respect to fees imposed by Third Parties to allow joint participation by the Provider and the Recipient under information technology contracts and licenses, which fees shall be split equally between the Provider and the Recipient) and (ii) any Additional Service shall be solely the responsibility of the Recipient.  If, with respect to a Service, the Parties, despite the use of such commercially reasonable efforts, are unable to obtain a required Third Party consent or the performance of such Service by the Provider would continue to constitute a violation of applicable Laws or the Abbott Code of Business Conduct,

 

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the Provider shall use commercially reasonable efforts in good faith to provide such Services in a manner as closely as possible to the standards described in this Section 2.03 that would apply absent the exception provided for in the first sentence of this Section 2.03(b) .

 

(c)                                   The Provider shall not be obligated to perform or to cause to be performed any Service in a volume or quantity in any calendar year that exceeds the highest volumes or quantities of analogous services provided to Abbott or its applicable functional group or Subsidiary during calendar year 2012, as set forth in the 2012 plan (without reference to the transactions contemplated by the Separation and Distribution Agreement) (the “ Service Baseline Period ”).  If the Recipient requests that the Provider perform or cause to be performed any Service in a volume or quantity that exceeds the highest volumes or quantities of analogous services that were provided to Abbott or its applicable functional group or Subsidiary during the Service Baseline Period, then: (i) if such higher volume or quantity results from fluctuations occurring in the ordinary course of business of the Recipient, the Provider shall use commercially reasonable efforts to provide such requested higher volume or quantity; and (ii) if such higher volume or quantity results from any other source, including an acquisition, merger, purchase or other business combination by the Recipient, the Parties shall cooperate and act in good faith to determine whether the Provider will be required to provide such requested higher volume or quantity.  If the Parties determine that the Provider shall provide the requested higher volume or quantity then such higher volume or quantity shall be documented in a written agreement signed by the Parties.  Each amended subsection of Schedule 1 hereto, as agreed to in writing by the Parties, shall be deemed part of this Agreement as of the date of such agreement and the volume or quantity increases set forth in such written agreement shall be deemed a part of the “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

(d)                                  (i) Neither the Provider nor any of its Subsidiaries shall be required to perform or to cause to be performed any of the Services for the benefit of any Third Party or any other Person other than the Recipient or its Subsidiaries, and (ii) EXCEPT AS EXPRESSLY PROVIDED IN THIS SECTION 2.03 , EACH PARTY ACKNOWLEDGES AND AGREES THAT ALL SERVICES AND PRODUCTS ARE PROVIDED ON AN “AS-IS” BASIS, THAT THE RECIPIENT ASSUMES ALL RISK AND LIABILITY ARISING FROM OR RELATING TO ITS USE OF AND RELIANCE UPON THE SERVICES, AND THAT THE PROVIDER MAKES NO OTHER REPRESENTATIONS OR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, WITH RESPECT TO THE SERVICES AND PRODUCTS.  EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

 

(e)                                   Each Party shall be responsible for its own compliance with any and all Laws applicable to its performance under this Agreement.  No Party shall knowingly take any action in violation of any such applicable Law that results in Liability being imposed on the other Party.

 

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Section 2.04.                           Charges for Services .  The Recipient shall pay the Provider of such Services a monthly fee for the Services (or category of Services, as applicable) (each fee constituting a “ Charge ” and, collectively, “ Charges ”), which Charges shall be agreed to by the Parties from time to time.  During the term of this Agreement, the amount of a Charge for any Services may adjust to the extent of:  (a) any adjustments mutually agreed to by the Parties; (b) any Charges applicable to any Omitted Services, Reinstated Services or Additional Services; and (c) in accordance with Section 2.08 , any proportional adjustment in the rates or charges imposed by any Third Party provider that is providing Services.  Together with any monthly invoice for Charges, the Provider shall provide the Recipient with reasonable documentation, including any additional documentation reasonably requested by the Recipient to the extent such documentation is in the Provider’s or its Subsidiaries’ possession or control, to support the calculation of such Charges.

 

Section 2.05.                           Reimbursement for Out-of-Pocket Expenses .  The Recipient shall reimburse the Provider for reasonable out-of-pocket costs and expenses incurred by the Provider or any of its Subsidiaries in connection with providing the Services (including reasonable travel-related expenses) to the extent that such costs and expenses are not reflected in the Charges for such Services; provided , however , that any such cost or expense not consistent with historical practice between the Parties for any Service (including business travel and related expenses) shall require advance approval of the Recipient.  Any authorized travel-related expenses incurred in performing the Services shall be incurred and charged to the Recipient in accordance with the Provider’s then applicable business travel policies.

 

Section 2.06.                           Changes to Services .

 

(a)                                  Except as provided in Section 2.08 and subject to the performance standards set forth in this Article II , the Provider may make changes from time to time in the manner of performing the Services if the Provider is making similar changes in performing analogous services for itself and if the Provider furnishes to the Recipient reasonable prior Notice (in content and timing) respecting such changes; provided , however , that the Provider may not modify any of its accounting policies or its foreign exchange rate setting process as defined in the B.2.0 policy that would directly or indirectly impact the Services without the prior written consent of the Recipient (such consent not to be unreasonably withheld or delayed).  No such change shall affect the timeliness or quality of, or the Charges for, the applicable Service.  If any such change by the Provider reasonably requires the Recipient to incur incremental costs and expenses in order to continue to receive and utilize the applicable Services in the same manner as the Recipient was receiving and utilizing such Service prior to such change, the Provider shall be required to reimburse the Recipient for all such reasonable costs and expenses.  Upon request, the Recipient shall provide the Provider with reasonable documentation, including any additional documentation reasonably requested by the Provider to the extent such documentation is in the Recipient’s or its Subsidiaries’ possession or control, to support the calculation of such incremental costs and expenses.

 

(b)                                  AbbVie acknowledges that it has received a copy of Abbott’s B.2.0 internal calendar for 2013 from Abbott. Prior to the commencement of each subsequent calendar year during the term of this Agreement, Abbott shall make available to AbbVie a copy of Abbott’s B.2.0 internal calendar for such calendar year (and AbbVie may request the same of

 

7



 

Abbott if Abbott has not made such copy available to AbbVie prior to the commencement of the applicable subsequent calendar year).

 

(c)                                   Prior to 12:00 p.m. Central Time on the B.2.0 day of each calendar month during the term of this Agreement, Abbott shall make available to AbbVie a copy of Abbott’s foreign exchange rates determined in accordance with Abbott’s B.2.0 policy for such calendar month (and AbbVie may request the same of Abbott if Abbott has not made such copy available to AbbVie prior to 12:00 p.m. Central Time on the B.2.0 day of the applicable calendar month).

 

Section 2.07.                           Transitional Nature of Services .  The Parties acknowledge the transitional nature of the Services and agree to cooperate in good faith and to use commercially reasonable efforts to effectuate a smooth transition of the Services from the Provider to the Recipient (or its designee).

 

Section 2.08.                           Use of Third Parties to Provide Services .  The Provider may perform its obligations to provide a Service through agents, subcontractors or independent contractors, provided that the delegation of performance of the applicable Service does not impact the timeliness or quality of such Service, in accordance with the following:

 

(a)                                  Provider is Currently Using Third Parties as of the Effective Time .  If, as of the Effective Time, (i) the Provider is obtaining analogous services for itself from agents, subcontractors or independent contractors, or (ii) the Provider is obtaining services from agents, subcontractors or independent contractors which services the Provider shall only provide to the Recipient under this Agreement and the Provider shall not otherwise require such analogous services for itself during the term of this Agreement, then the Charges for the applicable Services the Provider is obtaining from such Third Parties may be adjusted proportionally by the Provider pursuant to Section 2.04(c) to reflect any adjustment in the rates or charges imposed by the Third Party that is providing such Services; or

 

(b)                                  Provider Elects to Switch to Third Parties After the Effective Time .

 

(i)                                      If, following the Effective Time, the Provider elects to obtain analogous services for itself from agents, subcontractors or independent contractors (A) the Provider shall furnish to the Recipient reasonable prior Notice (in content and timing) respecting such use of Third Parties, and (B) the Charges for the applicable Services the Provider is obtaining from such Third Parties may be adjusted proportionally by the Provider pursuant to Section 2.04(c) to reflect any adjustment in the rates or charges imposed by the Third Party that is providing such Services; and

 

(ii)                                   If, however, following the Effective Time, the Provider is not obtaining analogous services for itself from agents, subcontractors or independent contractors (A) the Provider shall furnish to the Recipient reasonable prior Notice (in content and timing) respecting such use of Third Parties, and (B) the Charges for the applicable Services the Provider is providing through such Third Parties appointed following the Effective Time may not be adjusted by the Provider as a result of any adjustments in the rates or charges imposed by such Third Parties.

 

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Notwithstanding the foregoing, the Provider shall not be relieved of its obligations under this Agreement by use of such agents, subcontractors or independent contractors.

 

ARTICLE III

 

OTHER ARRANGEMENTS

 

Section 3.01.                           Access .

 

(a)                                  AbbVie shall, and shall cause its Subsidiaries to, allow Abbott and its Subsidiaries and their respective Representatives reasonable access to the facilities of AbbVie and its Subsidiaries that is necessary for Abbott and its Subsidiaries to fulfill their obligations under this Agreement.  In addition to the foregoing right of access, AbbVie shall, and shall cause its Subsidiaries to, afford Abbott, its Subsidiaries and their respective Representatives, upon reasonable advance notice, reasonable access during normal business hours to the facilities, Information, systems, infrastructure and personnel of AbbVie and its Subsidiaries as reasonably necessary for Abbott to verify the adequacy of internal controls over information technology, reporting of financial data and related processes employed in connection with the Services being provided by AbbVie or its Subsidiaries, including in connection with verifying compliance with Section 404 of the Sarbanes-Oxley Act of 2002; provided that (i) such access shall not unreasonably interfere with any of the business or operations of AbbVie or any of its Subsidiaries and (ii) in the event that AbbVie determines that providing such access could be commercially detrimental, violate any Law or agreement, or waive any attorney-client privilege, then the Parties shall use commercially reasonable efforts to permit such access in a manner that avoids any such harm or consequence.  Abbott agrees that all of its and its Subsidiaries’ employees shall, and that it shall use commercially reasonable efforts to cause its Representatives’ employees to, when on the property of AbbVie and its Subsidiaries, or when given access to any facilities, Information, systems, infrastructure or personnel of AbbVie and its Subsidiaries, conform to the policies and procedures of AbbVie and any of its Subsidiaries, as applicable, concerning health, safety, conduct and security which are made known to Abbott from time to time.

 

(b)                                  Abbott shall, and shall cause its Subsidiaries to, allow AbbVie and its Subsidiaries and their respective Representatives reasonable access to the facilities of Abbott and its Subsidiaries that is necessary for AbbVie and its Subsidiaries to fulfill their obligations under this Agreement.  In addition to the foregoing right of access, Abbott shall, and shall cause its Subsidiaries to, afford AbbVie, its Subsidiaries and their respective Representatives, upon reasonable advance notice, reasonable access during normal business hours to the facilities, Information, systems, infrastructure, and personnel of Abbott and its Subsidiaries as reasonably necessary for AbbVie to verify the adequacy of internal controls over information technology, reporting of financial data and related processes employed in connection with the Services being provided by Abbott or its Subsidiaries, including in connection with verifying compliance with Section 404 of the Sarbanes-Oxley Act of 2002; provided that (i) such access shall not unreasonably interfere with any of the business or operations of Abbott or any of its Subsidiaries and (ii) in the event that Abbott determines that providing such access could be commercially detrimental, violate any Law or agreement, or waive any attorney-client privilege, then the Parties shall use commercially reasonable efforts to permit such access in a manner that avoids

 

9



 

any such harm or consequence.  AbbVie agrees that all of its and its Subsidiaries’ employees shall, and that it shall use commercially reasonable efforts to cause its Representatives’ employees to, when on the property of Abbott and its Subsidiaries, or when given access to any facilities, Information, systems, infrastructure or personnel of Abbott and its Subsidiaries, conform to the policies and procedures of Abbott and any of its Subsidiaries, as applicable, concerning health, safety, conduct and security which are made known to AbbVie from time to time.

 

ARTICLE IV

 

BILLING; TAXES

 

Section 4.01.                           Procedure .  Charges for the Services shall be charged to and payable by the Recipient.  Amounts payable pursuant to the terms of this Agreement shall be paid by wire transfer (or such other method of payment as may be agreed between the Parties) to the Provider, as directed by the Provider, on a monthly basis, which amounts shall be due within sixty (60) days after the date of invoice.  All amounts due and payable hereunder shall be invoiced and paid in U.S. dollars.

 

Section 4.02.                           Late Payments .  Charges not paid when due pursuant to this Agreement (and any amounts billed or otherwise invoiced or demanded and properly payable that are not paid within sixty (60) days of the date of such bill, invoice or other demand) shall accrue interest at a rate per annum equal to the Prime Rate plus 2%, or the maximum legal rate, whichever is lower (the “ Interest Payment ”).

 

Section 4.03.                           Taxes .  Without limiting any provisions of this Agreement, the Recipient shall bear any and all Taxes and other similar charges (and any related interest and penalties) imposed on, or payable with respect to, any fees or charges, including any Charges, payable by it pursuant to this Agreement, including all sales, use, value-added, and similar Taxes, but excluding Taxes based on the Provider’s net income.  Notwithstanding anything to the contrary in the previous sentence or elsewhere in this Agreement, the Recipient shall be entitled to withhold from any payments to the Provider any such Taxes that the Recipient is required by Law to withhold and shall pay such Taxes to the applicable Tax Authority.

 

Section 4.04.                           No Set-Off .  Except as mutually agreed to in writing by Abbott and AbbVie, no Party or any of its Affiliates shall have any right of set off or other similar rights with respect to (a) any amounts received pursuant to this Agreement; or (b) any other amounts claimed to be owed to the other Party or any of its Subsidiaries arising out of this Agreement.

 

ARTICLE V

 

TERM AND TERMINATION

 

Section 5.01.                           Term .  This Agreement shall commence at the Effective Time and shall terminate upon the earlier to occur of:  (a) the last date on which either Party is obligated to provide any Service to the other Party in accordance with the terms of this Agreement; or (b) the mutual written agreement of the Parties to terminate this Agreement in its entirety.  Unless

 

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otherwise terminated pursuant to Section 5.02 , this Agreement shall terminate with respect to any Service at the close of business on the last day of the Service Period for such Service.  To the extent that the Provider’s ability to provide a Service is dependent on the continuation of a specified Service, the Provider’s obligation to provide such dependent Service shall terminate automatically with the termination of such supporting Service.

 

Section 5.02.                           Early Termination .

 

(a)                                  Without prejudice to the Recipient’s rights with respect to a Force Majeure, the Recipient may from time to time terminate this Agreement with respect to the entirety of any individual Service but not a portion thereof:

 

(i)                                      for any reason or no reason, upon the giving of an advance Notice to the Provider of such Service not less than the shorter of (A) one hundred eighty (180) days, or (B) one-half the original Service Period for such Service; provided , however , that any such termination may only be effective as of the last day of a month; or

 

(ii)                                   if the Provider of such Service has failed to perform any of its material obligations under this Agreement with respect to such Service, and such failure shall continue to exist forty five (45) days after receipt by the Provider of Notice of such failure from the Recipient; provided , however , that any such termination may only be effective as of the last day of a month; and provided , further , that the Recipient shall not be entitled to terminate the Agreement with respect to the applicable Service if, as of the end of such forty five (45)-day period, there remains a good faith Dispute between the Parties (undertaken in accordance with the terms of Section 9.07 ) as to whether the Provider has cured the applicable breach.

 

(b)                                  The Provider may terminate this Agreement with respect to any individual Service, but not a portion thereof, at any time upon prior Notice to the Recipient if the Recipient has failed to perform any of its material obligations under this Agreement relating to such Services, including making payment of Charges for such Service when due, and such failure shall continue uncured for a period of forty five (45) days after receipt by the Recipient of a Notice of such failure from the Provider; provided , however , that any such termination may only be effective as of the last day of a month; and provided , further , that the Provider shall not be entitled to terminate the Agreement with respect to the applicable Service if, as of the end of such forty five (45)-day period, there remains a good faith Dispute between the Parties (undertaken in accordance with the terms of Section 9.07 ) as to whether the Recipient has cured the applicable breach.  The relevant subsection of Schedule 1 hereto shall be updated to reflect any terminated Service.

 

Section 5.03.                           Reduction of Services .  The Recipient may from time to time request a reduction in part of the scope or amount of any Service; provided that any such reduction may only take effect as of the end of a month.  If requested to do so by the Recipient, the Parties shall discuss in good faith appropriate adjustments to the relevant Charges in light of all relevant factors.  If, after such discussions, the Parties do not approve any requested reduction of the scope or amount of any Service and the relevant Charges in connection therewith, then (a) there shall be no change to the Charges under this Agreement and (b) unless the Parties otherwise agree in writing, there shall be no change to the scope or amount of any Services under this

 

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Agreement.  If, after such discussions, the Parties agree to any reduction of Service, such reduction of Service shall be documented in a written agreement executed by the Parties.  Additionally, in connection with any such reduction of Service, the Parties may agree to an appropriate reduction to the Charges related to the applicable reduced Service.

 

Section 5.04.                           Extension of Services .

 

(a)                                  The Recipient may request to extend the Service Period of any Service (each such extension, a “ Service Extension ”) one time for each Service (unless the Parties otherwise agree) by providing the Provider of such Service with advance Notice not less than the shorter of (i) one hundred eighty (180) days, or (ii) one-half of the original Service Period for such Service.

 

(b)                                  If the Recipient is requesting a Service Extension for a particular Service for the first time and the requested Service Extension is for a period of twelve (12) months or less past the originally scheduled expiration of the Service Period for the applicable Service, then the Provider shall be obligated to provide such requested Service Extension and the Parties shall in good faith (i) negotiate the terms of an amendment to the applicable subsection of Schedule 1 hereto, which amendment shall be consistent with the terms of the applicable Service, and (ii) determine the costs and expenses (which shall not include any Charges payable under this Agreement), if any, that would be incurred by the Provider or the Recipient, as the case may be, in connection with the provision of such Service Extension, which costs and expenses shall be borne solely by the Recipient.  If (A) the requested Service Extension is for a period of longer than twelve (12) months past the originally scheduled expiration of the Service Period for the applicable Service or (B) the Recipient has previously requested a Service Extension for the particular Service that the Recipient is currently requesting a Service Extension, then the Parties shall cooperate and act in good faith to determine whether the Provider shall provide the applicable Service for the requested Service Extension period.  If the Parties determine that the Provider shall provide such Service during the requested Service Extension period, then the Parties shall in good faith (1) negotiate the terms of an amendment to the applicable subsection of Schedule 1 hereto, which amendment shall be consistent with the terms of the applicable Service, and (2) determine the costs and expenses (which shall not include any Charges payable under this Agreement), if any, that would be incurred by the Provider or the Recipient, as the case may be, in connection with the provision of such Service Extension, which costs and expenses shall be borne solely by the Recipient.  Each amended subsection of Schedule 1 hereto, as agreed to in writing by the Parties, shall be deemed part of this Agreement as of the date of such agreement and any Services provided pursuant to such Service Extensions shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

Section 5.05.                           Interdependencies .  The Parties acknowledge and agree that (i) there may be interdependencies among the Services being provided under this Agreement, (ii) upon the request of either Party, the Parties shall cooperate and act in good faith to determine whether (A) any such interdependencies exist with respect to the particular Service that a Party is seeking to terminate, reduce part of the scope or amount of, or extend, as applicable, in accordance with Section 5.02 , Section 5.03 or Section 5.04 , respectively, and (B) in the case of a termination or reduction, the Provider’s ability to provide a particular Service in accordance with this

 

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Agreement would be materially and adversely affected by such termination, or reduction in part of the scope or amount, of another Service, as applicable, in accordance with Section 5.02 or Section 5.03 , respectively, prior to the expiration of the period of the maximum duration for such Service, and (iii) in the event that the Parties have determined that such interdependencies exist (and, in the case of a termination or reduction, as applicable, that the Provider’s ability to provide a particular Service in accordance with this Agreement would be materially and adversely affected by the termination, or reduction in part of the scope or amount, of another Service, as applicable, in accordance with Section 5.02 or Section 5.03 , respectively, prior to the expiration of the period of the maximum duration for such Service), the Parties shall negotiate in good faith to amend Schedule 1 hereto relating to the termination dates of such impacted Service, which amendment shall be consistent with the terms of comparable Services.

 

Section 5.06.                           Effect of Termination .  Upon the termination of any Service pursuant to this Agreement, the Provider of the terminated Service shall have no further obligation to provide the terminated Service, and the Recipient shall have no obligation to pay any future Charges relating to any such Service; provided , however , that the Recipient shall remain obligated to the Provider for the Charges owed and payable in respect of Services provided prior to the effective date of termination for such Service.  In connection with the termination of any Service, the provisions of this Agreement not relating solely to such terminated Service shall survive any such termination, and in connection with a termination of this Agreement, Article I , this Article V , Article VII and Article IX , all confidentiality obligations under this Agreement and Liability for all due and unpaid Charges, shall continue to survive indefinitely.

 

Section 5.07.                           Information Transmission .  The Provider, on behalf of itself and its respective Subsidiaries, shall use commercially reasonable efforts to provide or make available, or cause to be provided or made available, to the Recipient, in accordance with Section 6.01(a) of the Separation and Distribution Agreement, any Information received or computed by the Provider for the benefit of the Recipient concerning the relevant Service during the Service Period; provided , however , that, except as otherwise agreed to in writing by the Parties (a) the Provider shall not have any obligation to provide or cause to provide Information in any non-standard format, (b) the Provider and its Subsidiaries shall be reimbursed for their reasonable costs in accordance with Section 6.01(c) of the Separation and Distribution Agreement for creating, gathering, copying, transporting and otherwise providing such Information, and (c) the Provider shall use commercially reasonable efforts to maintain any such Information in accordance with Section 6.03 of the Separation and Distribution Agreement.

 

ARTICLE VI

 

CONFIDENTIALITY; PROTECTIVE ARRANGEMENTS

 

Section 6.01.                           Abbott and AbbVie Obligations .  Subject to Section 6.04 , Abbott, on behalf of itself and each of the Abbott Subsidiaries, and AbbVie, on behalf of itself and each of the AbbVie Subsidiaries, agrees to hold, and to cause its respective Representatives to hold, in strict confidence, with at least the same degree of care that applies to Abbott’s confidential and proprietary information pursuant to policies in effect as of the Effective Time, all confidential and proprietary information concerning the other Party (or its business) and the other Party’s Subsidiaries (or their respective businesses) that is either in its possession (including confidential

 

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and proprietary information in its possession prior to the Effective Time) or furnished by the other Party or the other Party’s Subsidiaries or their respective Representatives at any time pursuant to this Agreement, and shall not use any such confidential and proprietary information other than for such purposes as may be expressly permitted hereunder, except, in each case, to the extent that such confidential and proprietary information has been (a) in the public domain or generally available to the public, other than as a result of a disclosure by such Party or any of its Subsidiaries or any of their respective Representatives in violation of this Agreement; (b) later lawfully acquired from other sources by such Party or any of its Subsidiaries, which sources are not themselves bound by a confidentiality obligation or other contractual, legal or fiduciary obligation of confidentiality with respect to such confidential and proprietary information; or (c) independently developed or generated without reference to or use of the respective proprietary or confidential information of the other Party or any of its Subsidiaries.  If any confidential and proprietary information of Abbott or any of its Subsidiaries is disclosed to AbbVie or any of its Subsidiaries in connection with providing the Services, then such disclosed confidential and proprietary information shall be used only as required to perform the Services.  If any confidential and proprietary information of AbbVie or any of its Subsidiaries is disclosed to Abbott or any of its Subsidiaries in connection with providing the Services, then such disclosed confidential and proprietary information shall be used only as required to perform such Services.

 

Section 6.02.                           No Release .  Each Party agrees (a) not to release or disclose, or permit to be released or disclosed, any information addressed in Section 6.01 to any other Person, except its Representatives who need to know such information in their capacities as such, and except in compliance with Section 6.04 and (b) to use commercially reasonable efforts to maintain any such information in accordance with Section 6.03 of the Separation and Distribution Agreement.

 

Section 6.03.                           Third Party Information; Privacy and Data Protection Laws .  Each Party acknowledges that it and its respective Subsidiaries may presently have and, following the Effective Time, may gain access to or possession of confidential or proprietary information of, or personal information relating to, Third Parties (a) that was received under confidentiality or non-disclosure agreements entered into between such Third Parties, on the one hand, and another Party or another Party’s Subsidiaries, on the other hand, prior to the Effective Time; or (b) that, as between the Parties, was originally collected by another Party or another Party’s Subsidiaries and that may be subject to and protected by privacy, data protection or other applicable Laws.  As provided in more detail in a data protection agreement to be entered into between Abbott and AbbVie as of the Effective Time, each Party agrees that it shall hold, protect and use, and shall cause its Subsidiaries and its and their respective Representatives to hold, protect and use, in strict confidence the confidential and proprietary information of, or personal information relating to, Third Parties in accordance with privacy, data protection or other applicable Laws and the terms of any agreements that were either entered into before the Effective Time or affirmative commitments or representations that were made before the Effective Time by, between or among such other Party or such other Party’s Subsidiaries, on the one hand, and such Third Parties, on the other hand.

 

Section 6.04.                           Protective Arrangements .  In the event that either Party or any of its Affiliates is requested or required (by oral question, interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) by any Governmental Authority or pursuant to applicable Law to disclose or provide any confidential or proprietary

 

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information of the other Party that is subject to the confidentiality provisions hereof, or to disclose or provide any Personal Data that it processes on behalf of the other Party in accordance with the data protection agreement to be entered into between Abbott and AbbVie as of the Effective Time, such Party shall, unless prohibited by such request or requirement of the applicable Governmental Authority or under applicable Law, provide the other Party with Notice of such request or demand as promptly as practicable under the circumstances so that such other Party shall have an opportunity to seek an appropriate protective order, at such other Party’s own cost and expense.  In the event that such other Party fails to receive such appropriate protective order in a timely manner and the Party receiving the request or demand reasonably determines that its failure to disclose or provide such information shall actually prejudice the Party receiving the request or demand, then the Party that received such request or demand may thereafter disclose or provide information to the extent required by such Law (as so advised by counsel) or by lawful process or such Governmental Authority.

 

ARTICLE VII

 

LIMITED LIABILITY AND INDEMNIFICATION

 

Section 7.01.                           Limitations on Liability .

 

(a)                                  SUBJECT TO SECTION 7.02 , THE LIABILITIES OF THE PROVIDER AND ITS SUBSIDIARIES AND THEIR RESPECTIVE REPRESENTATIVES, COLLECTIVELY, UNDER THIS AGREEMENT FOR ANY ACT OR FAILURE TO ACT IN CONNECTION HEREWITH (INCLUDING THE PERFORMANCE OR BREACH OF THIS AGREEMENT), OR FROM THE SALE, DELIVERY, PROVISION OR USE OF ANY SERVICES PROVIDED UNDER OR CONTEMPLATED BY THIS AGREEMENT, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY) OR OTHERWISE, SHALL NOT EXCEED THE PROVIDER’S PROFITS FOR PERFORMING SERVICES HEREUNDER, WHICH SHALL BE DEEMED TO BE EQUAL TO THE AMOUNT OF THE MARK-UP RECEIVED BY THE PROVIDER DURING THE PREVIOUS TWELVE (12) MONTH PERIOD.

 

(b)                                  IN NO EVENT SHALL EITHER PARTY, ITS SUBSIDIARIES OR THEIR RESPECTIVE REPRESENTATIVES BE LIABLE TO THE OTHER PARTY FOR INDIRECT, EXEMPLARY, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES IN CONNECTION WITH THE PERFORMANCE OF THIS AGREEMENT, EVEN IF THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND EACH PARTY HEREBY WAIVES ON BEHALF OF ITSELF, ITS SUBSIDIARIES AND ITS REPRESENTATIVES ANY CLAIM FOR SUCH DAMAGES, INCLUDING ANY CLAIM FOR PROPERTY DAMAGE OR LOST PROFITS, WHETHER ARISING IN CONTRACT, TORT OR OTHERWISE.

 

(c)                                   The foregoing limitations on Liability in this Section 7.01 shall not apply to either Party’s Liability for breaches of confidentiality under Article VI or either Party’s obligations under Section 7.03 .

 

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(d)                                  The limitations in Section 7.01(a) and Section 7.01(b) shall not apply in respect of any Liability arising out of or in connection with the gross negligence, willful misconduct, or fraud of or by the Party to be charged.

 

Section 7.02.                           Obligation to Re-Perform; Liabilities .  In the event of any breach of this Agreement by the Provider with respect to the provision of any Services (with respect to which the Provider can reasonably be expected to re-perform in a commercially reasonable manner), the Provider shall (a) promptly correct in all material respects such error, defect or breach or re-perform in all material respects such Services at the request of the Recipient and at the sole cost and expense of the Provider and (b) subject to the limitations set forth in Section 7.01 , reimburse the Recipient and its Subsidiaries and Representatives for Liabilities attributable to such breach by the Provider.  The remedy set forth in this Section 7.02 shall be the sole and exclusive remedy of the Recipient for any such breach of this Agreement.  Any request for re-performance in accordance with this Section 7.02 by the Recipient must be in writing and specify in reasonable detail the particular error, defect or breach, and such request must be made no more than one (1) month from the later of the date on which such breach occurred and the date on which such breach was reasonably discovered by the Recipient.

 

Section 7.03.                           Third Party Claims .  The Recipient shall indemnify, defend and hold harmless the Provider, its Subsidiaries and each of their respective Representatives, and each of the successors and assigns of any of the foregoing (collectively, the “ Provider Indemnitees ”), from and against any and all claims of Third Parties relating to, arising out of or resulting from the Provider’s furnishing or failing to furnish the Services provided for in this Agreement, other than (a) Third Party claims arising out of the gross negligence, willful misconduct or fraud of any Provider Indemnitee and (b) as set forth in Section 2.03(b) .

 

Section 7.04.                           Indemnification Procedures .  The provisions of Article IV of the Separation and Distribution Agreement shall govern claims for indemnification under this Agreement; provided that, for purposes of this Section 7.04 , in the event of any conflict between the provisions of Article IV of the Separation and Distribution Agreement and this Article VII , the provisions of this Agreement shall control.

 

ARTICLE VIII

 

TRANSITION COMMITTEE

 

Section 8.01.                           Establishment .  Pursuant to the Separation and Distribution Agreement, a Transition Committee is to be established by Abbott and AbbVie to, among other things, monitor and manage matters arising out of or resulting from this Agreement.

 

ARTICLE IX

 

MISCELLANEOUS

 

Section 9.01.                           Mutual Cooperation .  The Parties and their respective Subsidiaries shall cooperate with each other in connection with the performance of the Services hereunder; provided , however , that such cooperation shall not unreasonably disrupt the normal operations of

 

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the Parties and their respective Subsidiaries; and, provided , further , that this Section 9.01 shall not require either Party to incur any out-of-pocket costs or expenses unless and except as expressly provided in this Agreement or otherwise agreed to in writing by the Parties.

 

Section 9.02.                           Title to Intellectual Property .  Except as expressly provided for under the terms of this Agreement, the Recipient acknowledges that it shall acquire no right, title or interest (including any license rights or rights of use) in any intellectual property which is owned or licensed by the Provider, by reason of the provision of the Services provided hereunder.  The Recipient shall not remove or alter any copyright, trademark, confidentiality or other proprietary notices that appear on any intellectual property owned or licensed by the Provider, and the Recipient shall not reproduce any such notices on any and all copies thereof.  The Recipient shall not attempt to decompile, translate, reverse engineer or make excessive copies of any intellectual property owned or licensed by the Provider, and the Recipient shall promptly notify the Provider of any such attempt, regardless of whether by the Recipient or any Third Party, of which the Recipient becomes aware.

 

Section 9.03.                           Force Majeure .  No Party shall be deemed in default of this Agreement for failure to fulfill any obligation so long as and to the extent to which any delay or failure in the fulfillment of such obligations is prevented, frustrated, hindered or delayed as a consequence of circumstances of Force Majeure.  In the event of any such excused delay, the time for performance shall be extended for a period equal to the time lost by reason of the delay unless this Agreement has previously been terminated under Article V or under this Section 9.03 .  A Party claiming the benefit of this provision shall, as soon as reasonably practicable after the occurrence of any such event, (a) provide Notice to the Recipient or the Provider of the nature and extent of any such Force Majeure condition; and (b) use commercially reasonable efforts to remove any such causes and resume performance under this Agreement as soon as reasonably practicable unless this Agreement has previously been terminated under Article V or under this Section 9.03 .  During the period of a Force Majeure, the Recipient shall be (i) relieved of the obligation to pay Charges for such Service(s) throughout the duration of such Force Majeure and (ii) entitled to permanently terminate such Service(s) (and shall be relieved of the obligation to pay Charges for such Service(s) throughout the duration of such Force Majeure) if a Force Majeure shall continue to exist for more than thirty (30) consecutive days, it being understood that the Recipient shall not be required to provide any advance notice of such termination to the Provider.

 

Section 9.04.                           Independent Contractors .  The Parties each acknowledge that they are separate entities, each of which has entered into this Agreement for independent business reasons.  The relationships of the Parties hereunder are those of independent contractors and nothing contained herein shall be deemed to create a joint venture, partnership or any other relationship.  Employees performing services hereunder do so on behalf of, under the direction of, and as employees of, the Provider, and the Recipient shall have no right, power or authority to direct such employees.

 

Section 9.05.                           Third Party Beneficiaries .  Except as provided in Article VII with respect to Provider Indemnitees, (a) the provisions of this Agreement are solely for the benefit of the Parties, their Subsidiaries and their permitted successors and assigns, and are not intended to confer upon any other Person except the Parties, their Subsidiaries and their permitted successors

 

17



 

and assigns, any rights or remedies hereunder; and (b) there are no other Third Party beneficiaries of this Agreement and this Agreement shall not provide any other Third Party with any remedy, claim, Liability, reimbursement, claim of action or other right in excess of those existing without reference to this Agreement.

 

Section 9.06.                           Governing Law .  This Agreement shall be governed by and construed and interpreted in accordance with the Laws of the State of Delaware, irrespective of the choice of Laws principles of the State of Delaware, as to all matters, including matters of validity, construction, effect, enforceability, performance and remedies.

 

Section 9.07.                           Dispute Resolution .

 

(a)                                  In the event of any controversy, dispute or claim (a “ Dispute ”) arising out of or relating to any Party’s rights or obligations under this Agreement (whether arising in contract, tort or otherwise) or calculation or allocation of the costs of any Service, or otherwise arising out of or relating in any way to this Agreement (including the interpretation or validity of this Agreement), such Dispute shall be resolved in accordance with the dispute resolution process referred to in Section 7.01 to the Separation and Distribution Agreement.

 

(b)                                  In any Dispute regarding the amount of a Charge, if such Dispute is finally resolved pursuant to the dispute resolution process set forth or referred to in Section 9.07(a)  and it is determined that the Charge that the Provider has invoiced the Recipient, and that the Recipient has paid to the Provider, is greater or less than the amount that the Charge should have been, then (i) if it is determined that the Recipient has overpaid the Charge, the Provider shall within five (5) business days after such determination reimburse the Recipient an amount of cash equal to such overpayment, plus the Interest Payment, accruing from the date of payment by the Recipient to the time of reimbursement by the Provider; and (ii) if it is determined that the Recipient has underpaid the Charge, the Recipient shall within five (5) business days after such determination reimburse the Provider an amount of cash equal to such underpayment, plus the Interest Payment, accruing from the date such payment originally should have been made by the Recipient to the time of payment by the Recipient.

 

Section 9.08.                           Specific Performance .  Subject to Section 9.07 , in the event of any actual or threatened default in, or breach of, any of the terms, conditions and provisions of this Agreement, the Party or Parties who are or are to be thereby aggrieved shall have the right to specific performance and injunctive or other equitable relief (on an interim or permanent basis) of its rights under this Agreement, in addition to any and all other rights and remedies at Law or in equity, and all such rights and remedies shall be cumulative.  The Parties agree that the remedies at Law for any breach or threatened breach, including monetary damages, may be inadequate compensation for any loss and that any defense in any Proceeding for specific performance that a remedy at Law would be adequate is waived.  Unless otherwise agreed in writing, the Parties shall continue to provide Services and honor all other commitments under this Agreement during the course of dispute resolution pursuant to the provisions of Section 9.07 and this Section 9.08 with respect to all matters subject to such Dispute; provided , however , that this obligation shall only exist during the term of this Agreement.

 

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Section 9.09.                           Interpretation .  Words in the singular shall be deemed to include the plural and vice versa and words of one gender shall be deemed to include the other genders as the context requires.  The terms “hereof,” “herein,” and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole (including all of the Schedules and Exhibits hereto and thereto) and not to any particular provision of this Agreement.  Section, Exhibit and Schedule references are to the Sections, Exhibits, and Schedules to this Agreement unless otherwise specified.  Unless otherwise stated, all references to any agreement shall be deemed to include the exhibits, schedules and annexes to such agreement.  The word “including” and words of similar import when used in this Agreement shall mean “including, without limitation,” unless the context otherwise requires or unless otherwise specified.  The word “or” shall not be exclusive.  Unless otherwise specified in a particular case, the word “days” refers to calendar days.  References herein to this Agreement or any other agreement contemplated herein shall be deemed to refer to this Agreement or such other agreement as of the date on which it is executed and as it may be amended, modified or supplemented thereafter, unless otherwise specified.  References to the performance, discharge or fulfillment of any Liability in accordance with its terms shall have meaning only to the extent such Liability has terms.  If the Liability does not have terms, the reference shall mean performance, discharge or fulfillment of such Liability.

 

Section 9.10.                           Headings .  The Article, Section and Paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

 

Section 9.11.                           Amendment .  No provisions of this Agreement shall be deemed amended, supplemented or modified unless such amendment, supplement or modification is in writing and signed by an authorized representative of each of Abbott and AbbVie.  No provisions of this Agreement shall be deemed waived unless such waiver is in writing and signed by the authorized representative of the Party against whom it is sought to be enforced.

 

Section 9.12.                           Assignability .  This Agreement shall not be assigned without the prior written consent of Abbott and AbbVie, except that:

 

(a)                                  each Party may assign all of its rights and obligations under this Agreement to any of its Subsidiaries; provided , however , that no such assignment shall release the assigning Party from any Liability under this Agreement; and

 

(b)                                  in connection with (i) either Party’s divestiture of all or substantially all of its assets to a Third Party or (ii) a Change of Control of either Party, such Party may assign to such Third Party its rights and obligations under this Agreement; provided , however , that (x) no such assignment shall release the assigning Party from any Liability under this Agreement, (y) any and all costs and expenses incurred by either Party in connection with such assignment (including in connection with clause (z) of this proviso) shall be borne solely by the assigning Party, and (z) the Parties shall in good faith negotiate any amendments to this Agreement, including the Exhibits and Schedules to this Agreement, that may be reasonably necessary in order to assign such Services.

 

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Section 9.13.                           Audit Assistance .  Each of the Parties and their respective Subsidiaries are or may be subject to regulation and audit by a Governmental Authority, standards organizations, customers or other parties to contracts with such Parties or their respective Subsidiaries under applicable Law, standards or contract provisions.  If a Governmental Authority, standards organization, customer or other party to a contract with a Party or its Subsidiary exercises its right to examine or audit such Party’s or its Subsidiary’s books, records, documents or accounting practices and procedures pursuant to such applicable Law, standards or contract provisions, and such examination or audit relates to the Services, then the other Party shall provide, at the sole cost and expense of the requesting Party, all assistance reasonably requested by the Party that is subject to the examination or audit in responding to such examination or audits or requests for information, to the extent that such assistance or information is within the reasonable control of the cooperating Party and is related to the Services.

 

Section 9.14.                           Survival of Covenants .  Except as expressly set forth in this Agreement, the covenants and other agreements contained in this Agreement, and Liability for the breach of any obligations contained herein, shall survive the Effective Time and shall remain in full force and effect thereafter.

 

Section 9.15.                           Subsidiaries .  Abbott shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth herein to be performed by an Abbott Subsidiary and AbbVie shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth herein to be performed by an AbbVie Subsidiary.

 

Section 9.16.                           Waivers of Default .  Waiver by a Party of any default by the other Party of any provision of this Agreement shall not be deemed a waiver by the waiving Party of any subsequent or other default, nor shall it prejudice the rights of the waiving Party.

 

Section 9.17.                           Notices .  All Notices under this Agreement shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by overnight courier service, by facsimile with receipt confirmed (followed by delivery of an original via overnight courier service) or by registered or certified mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a Notice):

 

If to Abbott:

 

Abbott Laboratories

100 Abbott Park Road

Abbott Park, Illinois 60064-6020

Attn: Divisional Vice President, Abbott Transition Organization

Facsimile: (847) 938-5313

 

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If to AbbVie:

 

AbbVie Inc.
1 North Waukegan Road
North Chicago, Illinois 60064

Attn: Vice President, Strategic Initiative

Facsimile: (847) 937-4330

 

Either Party may, by Notice to the other Party, change the address to which such Notices are to be given.

 

Section 9.18.                           Counterparts .  This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement.

 

Section 9.19.                           Entire Agreement .  This Agreement and the exhibits and schedules hereto contain the entire agreement between the Parties with respect to the subject matter hereof, supersede all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter and there are no agreements or understandings between the Parties other than those set forth or referred to herein or therein.

 

Section 9.20.                           Corporate Power .  Abbott represents on behalf of itself and, to the extent applicable, each Abbott Subsidiary, and AbbVie represents on behalf of itself and, to the extent applicable, each AbbVie Subsidiary, as follows:

 

(a)                                  each such Person has the requisite corporate or other power and authority and has taken all corporate or other action necessary in order to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby; and

 

(b)                                  this Agreement has been duly executed and delivered by it and constitutes a valid and binding agreement of it enforceable in accordance with the terms hereof.

 

Section 9.21.                           Signatures and Delivery .  Each of Abbott and AbbVie acknowledges that it may execute this Agreement by manual, stamp or mechanical signature, and that delivery of an executed counterpart of a signature page to this Agreement (whether executed by manual, stamp or mechanical signature) by facsimile or by email in portable document format (PDF) shall be effective as delivery of such executed counterpart of this Agreement.  Each of Abbott and AbbVie expressly adopts and confirms a stamp or mechanical signature (regardless of whether delivered in person, by mail, by courier, by facsimile or by email in portable document format (PDF)) made in its respective name as if it were a manual signature delivered in person, agrees that it shall not assert that any such signature or delivery is not adequate to bind it to the same extent as if it were signed manually and delivered in person and agrees that, at the reasonable request of the other Party at any time, it shall as promptly as reasonably practicable cause this Agreement to be manually executed (any such execution to be as of the date of the initial date hereof) and delivered in person, by mail or by courier.

 

Section 9.22.                           Severability .  In the event that any one or more of the terms or provisions of this Agreement or the application thereof to any Person or circumstance is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other term or provision of this

 

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Agreement, or the application of such term or provision to Persons or circumstances or in jurisdictions other than those as to which it has been determined to be invalid, illegal or unenforceable, and the Parties shall use their commercially reasonable efforts to substitute one or more valid, legal and enforceable terms or provisions into this Agreement which, insofar as practicable, implement the purposes and intent of the Parties.  Any term or provision of this Agreement held invalid or unenforceable only in part, degree or within certain jurisdictions shall remain in full force and effect to the extent not held invalid or unenforceable to the extent consistent with the intent of the Parties as reflected by this Agreement.  To the extent permitted by applicable Law, each Party waives any term or provision of Law which renders any term or provision of this Agreement to be invalid, illegal or unenforceable in any respect.

 

Section 9.23.                           Further Assurances .  Each Party hereto shall take, or cause to be taken, any and all reasonable actions, including the execution, acknowledgment, filing and delivery of any and all documents and instruments that any other Party hereto may reasonably request in order to effect the intent and purpose of this Agreement and the transactions contemplated hereby.

 

Section 9.24.                           Public Announcements .  From and after the Effective Time, the Parties shall consult with each other before issuing, and give each other the opportunity to review and comment upon, that portion of any press release or other public statements that relates to the transactions contemplated by this Agreement, and shall not issue any such press release or make any such public statement prior to such consultation, except (a) 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; or (b) as otherwise set forth on Schedule 9.16 to the Separation and Distribution Agreement.

 

Section 9.25.                           Mutual Drafting .  This Agreement shall be deemed to be the joint work product of the Parties and any rule of construction that a document shall be interpreted or construed against a drafter of such document shall not be applicable.

 

* * * * *

 

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives.

 

 

ABBOTT LABORATORIES

ABBVIE INC.

 

 

 

 

By:

/s/ Thomas C. Freyman

 

By:

/s/ Richard A. Gonzalez

 

Name:

Thomas C. Freyman

 

 

Name:

Richard A. Gonzalez

 

Title:

Executive Vice President, Finance and Chief Financial Officer

 

 

Title:

Chairman of the Board and Chief Executive Officer

 

 

[Signature Page to U.S. Transition Services Agreement]

 



 

Exhibit A

Omitted Services/Additional Services Template

 

 Function:

 

 Service Provider:

 

 Service Recipient:

 

 Description of  Transition Services:

 

 Term:

 

 

A-1


 

Schedule 1

Services

 

Function:

Human Resources

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

HR program administration, HR related communications consulting and certain payroll and HR services.

Term:

Up to 24 months

 

Sch 1-1



 

Function:

Purchasing

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Access to purchasing content, systems and related support, sourcing and rebate management.

Term:

Up to 24 months

 

Sch 1-2



 

Function:

Information Systems

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Application support and maintenance; mainframe and services access and support; IT customer support, training and administration; planning and program management support; Finance/SFA functional support; and IT support, maintenance, infrastructure, subject matter expertise and system access to key systems.

Term:

24 Months

 

Sch 1-3



 

Function:

Information Systems

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Application support and maintenance, program management for upgrades of server and coordination for DRP & Disaster Recovery Testing, change management coordination and quality & privacy-related web monitoring on behalf of the affiliates, system support for Prisms CRM system, project management support for special area special projects, IT support, maintenance, infrastructure, subject matter expertise and system access to key systems.

Term:

Up to 24 months

 

Sch 1-4



 

Function:

Internal Audit

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Internal audits of international shared locations and Sarbanes-Oxley related support.

Term:

24 Months

 

Sch 1-5



 

Function:

Internal Audit

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Sarbanes-Oxley related support.

Term:

24 Months

 

Sch 1-6



 

Function:

AN

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

System support, consulting services, subject matter expertise, medical safety and surveillance, certain manufacturing and labor support, AbbVie operations service/support at certain manufacturing site(s).

Term:

Up to 24 months

 

Sch 1-7



 

Function:

Administrative Services

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Corporate records, creative network communications and public affairs, delivery service, fleet management, food service contracts, conference rooms/audio visual, interior design storage, library information contracts/systems, travel, meetings, telepresence/video services, and management oversight.

Term:

Up to 24 months

 

Sch 1-8



 

Function:

Administrative Services

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

J-28 building floorspace, cafeteria catering related services.

Term:

24 Months

 

Sch 1-9



 

Function:

AVD

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Clinical trial support.

Term:

24 Months

 

Sch 1-10


 

Function:

Finance

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Controlled drug reporting, cost maintenance, product identification coding, lot number location coding, RGL ledger accounting support, royalty contract administration/accounting, SOX support, corporate C&TC, US accounts payable, expense reporting, US freight payment, knowledge transfer, US payroll processing, CEPA support, corporate accounting staffing and training, and abandoned property compliance tasks.

Term:

Up to 24 months

 

Sch 1-11



 

Function:

Finance

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Deferred margin services, sales reporting and consolidation, transfer pricing, IT system access/support, forecast information for transfer pricing, and knowledge sharing.

Term:

24 Months

 

Sch 1-12



 

Function:

Engineering Services

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Crisis management, EHS&E consultation, global project management, security/guard, Lake County related support, emergency generator access, Calibration/Metrology, and IT system access and support.

Term:

24 Months

 

Sch 1-13



 

Function:

Engineering Services

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Crisis management, EHS&E consultation, global project management, security/guard, Lake County support, emergency generator access, Calibration/Metrology support, and IT system access and support.

Term:

Up to 24 months

 

Sch 1-14



 

Function:

Research and Development

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Certain co-development-related services and subject matter expertise.

Term:

Up to 24 months.

 

Sch 1-15



 

Function:

Research and Development

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

IT system/application access and business support, mass spectrometry support, NMR support, extrusion of nutritional products, scientific stockroom/lab services, chemical hygiene plan, outsourcing grant plan, PV case processing, PV data management, and microscopy/physical analytical chemistry support.

Term:

Up to 24 months.

 

Sch 1-16



 

Function:

L&A

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Finance variable and fixed allocations.

Term:

Up to 24 months

 

Sch 1-17



 

Function:

Legal

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Financial consulting, patent search, legal operations consulting, IP property operations consulting, and legal IT systems support.

Term:

Up to 24 months

 

Sch 1-18



 

Function:

Legal

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Financial consulting, patent search, and legal operations consulting.

Term:

24 Months

 

Sch 1-19



 

Function:

Ethics and Compliance

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

IT systems/applications access and support, transparency support, investigations management, and 3PP & anticorruption management.

Term:

Up to 24 months

 

Sch 1-20


 

Function:

Ethics and Compliance

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Transparency support and investigations management support.

Term:

24 Months

 

Sch 1-21



 

Function:

Public Affairs

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Product donation administration, administration/advisory support (employee giving, matching grants, volunteerism programs, and blood drive), and knowledge transfer of related giving programs and IRPA functional expertise.

Term:

Up to 24 months

 

Sch 1-22



 

Function:

Public Affairs

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Knowledge transfer of related giving programs and IRPA functional expertise.

Term:

Up to 24 months

 

Sch 1-23



 

Function:

US Commercial

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Patient Assistance Foundation administrative support, and IT system access/support.

Term:

Up to 24 months

 

Sch 1-24



 

Function:

Commercial/Headquarters

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Expat benefits, front office support, international HQ and affiliate IT system/application/infrastructure, international IT planning, affiliate external website support, financial reporting & consolidation IT services/support, certain Corp Purchasing Legal pass-through, AS/400 support, international IT policy training, and international SOX support.

Term:

24 Months

 

Sch 1-25



 

Function:

Regulatory

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

IT systems/applications support, and regulatory subject matter expertise.

Term:

24 Months

 

Sch 1-26



 

Function:

Regulatory

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

IT systems/applications support, and regulatory subject matter expertise.

Term:

24 Months

 

Sch 1-27



 

Function:

Tax

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Corporate tax support.

Term:

24 Months

 

Sch 1-28



 

Function:

Tax

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

Corporate tax support.

Term:

24 Months

 

Sch 1-29



 

Function:

Treasury

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Cash management, treasury operations, shareholder services, netting coordination, FX hedging, inter-company loan account maintenance, Luxembourg office and accounting support, real estate consulting, and retirement funds consulting.

Term:

Up to 24 months

 

Sch 1-30


 

Function:

Quality

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

Pharma label support, QA plant services, animal services, AQR subject matter expertise, and complaint processing.

Term:

Up to 24 months

 

Sch 1-31



 

Function:

Quality

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

IT system/application access, QA plant services, stability storage, subject matter expertise, PV QA audit and compliance, GCP affiliate audit/management, Global Inspection Management services, and AEGIS workflow support.

Term:

Up to 24 months

 

Sch 1-32



 

Function:

Manufacturing and Supply Chain

Service Provider:

Abbott

Service Recipient:

AbbVie

Description of Transition Services:

IT system/application access and support, supply/provide storage of solvents recovery used as comparable fuel, anti-counterfeiting service support, State Departments of Agriculture Synermax Registrations maintenance, anti-body production, supply materials, Global Standards and Serialization Office (GSSO) support, and corporate customs & trade compliance support.

Term:

Up to 24 months

 

Sch 1-33



 

Function:

Manufacturing and Supply Chain

Service Provider:

AbbVie

Service Recipient:

Abbott

Description of Transition Services:

IT system/application access and support, logistics/customs compliance, accounts payable, treasury, project accounting, payroll, tax, Foreign Trade Zone (FTZ) Services, occupational health, emergency spill response support, industrial hygiene, metrology, freight handling, housekeeping, waste management, distribution, Global Supply Dept. support, stability, serialization support, anti-counterfeiting service support, supply materials, contract administrative, freight audit functions, cold storage, operations, warehouse space and receiving, and hazardous waste recovery.

Term:

Up to 24 months

 

Sch 1-34




Exhibit 10.2

 

EXECUTION VERSION

 

EX-U.S. TRANSITION SERVICES AGREEMENT

 

BY AND BETWEEN

 

ABBOTT LABORATORIES

 

AND

 

ABBVIE INC.

 

DATED AS OF DECEMBER 31, 2012

 



 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE I

DEFINITIONS

1

 

 

 

Section 1.01.

Definitions

1

 

 

 

ARTICLE II

SERVICES

4

 

 

 

Section 2.01.

Initial Services

4

Section 2.02.

Omitted Services; Excluded Services; Additional Services

4

Section 2.03.

Performance of Services

6

Section 2.04.

Charges for Services

7

Section 2.05.

Reimbursement for Out-of-Pocket Expenses

8

Section 2.06.

Changes to Services

8

Section 2.07.

Transitional Nature of Services

8

Section 2.08.

Use of Third Parties to Provide Services

9

Section 2.09.

Joinder Agreement

9

 

 

 

ARTICLE III

OTHER ARRANGEMENTS

10

 

 

 

Section 3.01.

Access

10

 

 

 

ARTICLE IV

BILLING; TAXES

11

 

 

 

Section 4.01.

Procedure

11

Section 4.02.

Late Payments

11

Section 4.03.

Taxes

11

Section 4.04.

No Set-Off

11

 

 

 

ARTICLE V

TERM AND TERMINATION

11

 

 

 

Section 5.01.

Term

11

Section 5.02.

Early Termination

12

Section 5.03.

Reduction of Services

12

Section 5.04.

Extension of Services

13

Section 5.05.

Interdependencies

14

Section 5.06.

Effect of Termination

14

Section 5.07.

Information Transmission

15

 

 

 

ARTICLE VI

CONFIDENTIALITY; PROTECTIVE ARRANGEMENTS

15

 

 

 

Section 6.01.

Abbott and AbbVie Obligations

15

Section 6.02.

No Release

16

Section 6.03.

Third Party Information; Privacy and Data Protection Laws

16

Section 6.04.

Protective Arrangements

16

 

i



 

TABLE OF CONTENTS
(continued)

 

 

 

Page

 

 

 

ARTICLE VII

LIMITED LIABILITY AND INDEMNIFICATION

17

 

 

 

Section 7.01.

Limitations on Liability

17

Section 7.02.

Obligation to Re-Perform; Liabilities

17

Section 7.03.

Third Party Claims

18

Section 7.04.

Indemnification Procedures

18

 

 

 

ARTICLE VIII

TRANSITION COMMITTEE; ABBOTT AND ABBVIE RIGHTS

18

 

 

 

Section 8.01.

Establishment

18

Section 8.02.

Rights of Abbott and AbbVie

18

 

 

 

ARTICLE IX

MISCELLANEOUS

18

 

 

 

Section 9.01.

Mutual Cooperation

18

Section 9.02.

Title to Intellectual Property

18

Section 9.03.

Force Majeure

19

Section 9.04.

Independent Contractors

19

Section 9.05.

Third Party Beneficiaries

19

Section 9.06.

Governing Law

20

Section 9.07.

Dispute Resolution

20

Section 9.08.

Specific Performance

20

Section 9.09.

Interpretation

20

Section 9.10.

Headings

21

Section 9.11.

Amendment

21

Section 9.12.

Assignability

21

Section 9.13.

Audit Assistance

21

Section 9.14.

Survival of Covenants

22

Section 9.15.

Subsidiaries

22

Section 9.16.

Waivers of Default

22

Section 9.17.

Notices

22

Section 9.18.

Counterparts

23

Section 9.19.

Entire Agreement

23

Section 9.20.

Corporate Power

23

Section 9.21.

Signatures and Delivery

23

Section 9.22.

Severability

23

 

ii



 

TABLE OF CONTENTS
(continued)

 

 

 

Page

 

 

 

Section 9.23.

Attorney-in-Fact

24

Section 9.24.

Further Assurances

24

Section 9.25.

Public Announcements

25

Section 9.26.

Mutual Drafting

25

 

iii



 

EXHIBITS

 

Exhibit A-1

Other Manufacturing Costs

 

Exhibit A-2

Quality Assurance

 

Exhibit A-3

Distribution — Order Entry

 

Exhibit A-4

Distribution — Warehousing

 

Exhibit A-5

Other Charges to COGS

 

Exhibit A-6

Regulatory Affairs

 

Exhibit A-7

Medical Affairs

 

Exhibit A-8

Pharmacovigilance

 

Exhibit A-9

Development

 

Exhibit A-10

Other R&D / Medical

 

Exhibit A-11

Advertising / Marketing

 

Exhibit A-12

Sales Force Support

 

Exhibit A-13

Accounting, Reporting & Financial Services

 

Exhibit A-14

Financial Planning & Analysis

 

Exhibit A-15

Information Technology

 

Exhibit A-16

Office Space, Facilities & Related

 

Exhibit A-17

Other General Administration

 

Exhibit B

Omitted Services/Additional Services Template

 

Exhibit C

Form of Joinder Agreement

 

 

iv



 

THIS EX-U.S. TRANSITION SERVICES AGREEMENT, dated as of December 31, 2012, is by and between ABBOTT LABORATORIES, an Illinois corporation (“ Abbott ”) and ABBVIE INC., a Delaware corporation (“ AbbVie ”), and each of their respective Subsidiaries (as defined herein) who execute a Joinder Agreement (as defined herein) in accordance with the terms and provisions of this Agreement (as defined herein).

 

R E C I T A L S:

 

WHEREAS, the board of directors of Abbott has determined that it is appropriate and advisable to separate Abbott’s research-based pharmaceuticals business from its other businesses;

 

WHEREAS, in order to effectuate the foregoing, Abbott and AbbVie have entered into a Separation and Distribution Agreement, dated as of November 28, 2012 (the “ Separation and Distribution Agreement ”), which provides for, among other things, the contribution from Abbott to AbbVie of certain assets, the assumption by AbbVie of certain Liabilities (as defined in the Separation and Distribution Agreement) from Abbott, the distribution by Abbott of AbbVie common stock to Abbott shareholders, and the execution and delivery of certain agreements in order to facilitate and provide for the foregoing, in each case subject to the terms and conditions set forth therein; and

 

WHEREAS, in order to facilitate and provide for an orderly transition under the Separation and Distribution Agreement, the Parties desire to enter into this Agreement to set forth the terms and conditions pursuant to which each Provider (as defined herein) shall provide to the applicable Recipient (as defined herein) the Services (as defined herein) for a transitional period.

 

NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this Agreement, the Parties (as defined herein) hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

Section 1.01.                           Definitions .  Reference is made to Section 9.09 regarding the interpretation of certain words and phrases used in this Agreement.  In addition, for the purpose of this Agreement, the following terms shall have the meanings set forth below; provided that where such term is defined to have the meaning set forth in the Separation and Distribution Agreement and such definition includes the term “Party”, then “Party” as used in the definition of such term in the Separation and Distribution Agreement shall be construed to have the meaning set forth in this Agreement.

 

Abbott ” has the meaning set forth in the Preamble.

 

Abbott Subsidiary ” has the meaning set forth in the Separation and Distribution Agreement.

 

AbbVie ” has the meaning set forth in the Preamble.

 

1



 

AbbVie Business ” has the meaning set forth in the Separation and Distribution Agreement.

 

AbbVie Subsidiary ” has the meaning set forth in the Separation and Distribution Agreement.

 

Accounting, Reporting & Financial Services ” has the meaning set forth in Section 5.04(c) .

 

Additional Service ” has the meaning set forth in Section 2.02(c) .

 

Affiliate ” has the meaning set forth in the Separation and Distribution Agreement.

 

Agreement ” means this Ex-U.S. Transition Services Agreement, each of the Schedules and Exhibits hereto and each Joinder Agreement executed in accordance with Section 2.09 .

 

ARF Service Period End Date ” has the meaning set forth in Section 5.04(c) .

 

Change of Control ” has the meaning set forth in the Separation and Distribution Agreement.

 

Charges ” has the meaning set forth in Section 2.04 .

 

Collection Service ” has the meaning set forth in Section 5.04(c) .

 

Commencement Date ” means, with respect to a given Recipient and the applicable Provider, the date set forth under the heading “Commencement Date” on Schedule 1 to the applicable Joinder Agreement executed by such Recipient and the applicable Provider.

 

Dispute ” has the meaning set forth in Section 9.07(a) .

 

Effective Time ” has the meaning set forth in the Separation and Distribution Agreement.

 

Excluded Service ” has the meaning set forth in Section 2.02(b) .

 

Force Majeure ” has the meaning set forth in the Separation and Distribution Agreement.

 

Governmental Authority ” has the meaning set forth in the Separation and Distribution Agreement.

 

Information ” has the meaning set forth in the Separation and Distribution Agreement.

 

Initial Services ” has the meaning set forth in Section 2.01 .

 

2



 

Interest Payment ” has the meaning set forth in Section 4.02 .

 

Joinder Agreement ” has the meaning set forth in Section 2.09 .

 

Law ” has the meaning set forth in the Separation and Distribution Agreement.

 

Liabilities ” has the meaning set forth in the Separation and Distribution Agreement.

 

Notice ” means any written notice, request, demand or other communication specifically referencing this Agreement and given in accordance with Section 9.17 .

 

Omitted Service ” has the meaning set forth in Section 2.02(a) .

 

Parties ” means Abbott and the Abbott Subsidiaries who execute a Joinder Agreement pursuant to Section 2.09 , on the one hand, and AbbVie and the AbbVie Subsidiaries who execute a Joinder Agreement pursuant to Section 2.09 , on the other hand.

 

Person ” has the meaning set forth in the Separation and Distribution Agreement.

 

Personal Data ” means data that can be used by itself or in combination with other available data to identify a specific individual.

 

Prime Rate ” has the meaning set forth in the Separation and Distribution Agreement.

 

Privileged Information ” has the meaning set forth in the Separation and Distribution Agreement.

 

Proceeding ” has the meaning set forth in the Separation and Distribution Agreement.

 

Provider ” means, with respect to any Service, the Affiliate or Affiliates of Abbott or AbbVie who have executed a Joinder Agreement and is or are identified therein as the “Provider,” or Abbott or AbbVie, as the case may be, if they are identified as the “Provider” in any Joinder Agreement.

 

Provider Indemnitees ” has the meaning set forth in Section 7.03 .

 

Recipient ” means, with respect to any Service, the Affiliate or Affiliates of Abbott or AbbVie who have executed a Joinder Agreement and is or are identified therein as the “Recipient,” or Abbott or AbbVie, as the case may be, if they are identified as the “Recipient” in any Joinder Agreement.

 

Reinstated Service ” has the meaning set forth in Section 2.02(b) .

 

Representatives ” has the meaning set forth in the Separation and Distribution Agreement.

 

3



 

Separation and Distribution Agreement ” has the meaning set forth in the Recitals.

 

Service Baseline Period ” has the meaning set forth in Section 2.03(c) .

 

Service Extension ” has the meaning set forth in Section 5.04(a) .

 

Service Period ” means, with respect to any Service provided to a given Recipient, the period commencing on the later of (a) the Commencement Date for such Service and (b) the date on which any Omitted Service, Excluded Service or Additional Service becomes a “Service” pursuant to the terms of this Agreement, and ending on the earlier of (i) the date the Recipient terminates the provision of such Service pursuant to Section 5.02 and (ii) the second anniversary of the Effective Time, unless extended pursuant to Section 5.04 .

 

Services ” means, with respect to a given Recipient, the Initial Services and the applicable Omitted Services, Reinstated Services and Additional Services for such Recipient.

 

Subsidiary ” has the meaning set forth in the Separation and Distribution Agreement.

 

Tax ” has the meaning set forth in the Separation and Distribution Agreement.

 

Tax Authority ” has the meaning set forth in the Separation and Distribution Agreement.

 

Third Party ” has the meaning set forth in the Separation and Distribution Agreement.

 

Transition Committee ” has the meaning set forth in the Separation and Distribution Agreement.

 

ARTICLE II

 

SERVICES

 

Section 2.01.                           Initial Services .  Effective as of the commencement of the Service Period, the applicable Provider shall provide, or Abbott or AbbVie, as applicable, shall cause one or more of its other Subsidiaries to provide, to the applicable Recipient, the services (the “ Initial Services ”) for which a Commencement Date is indicated on Schedule 1 of the applicable Joinder Agreement for such Recipient and as described in greater detail on the subsections of Exhibit A hereto.

 

Section 2.02.                           Omitted Services; Excluded Services; Additional Services .

 

(a)                                  If, following the Effective Time and during the term of this Agreement, a Recipient identifies a service that, prior to the Effective Time, its applicable Provider or any of its Subsidiaries provided to such Recipient, but such service was inadvertently omitted from the Services set forth on Schedule 1 of the applicable Joinder Agreement (each such service, an

 

4



 

Omitted Service ”), then such Provider shall use commercially reasonable efforts to provide, or to cause one of its Subsidiaries to provide, any such Omitted Service to such Recipient; provided that such Provider shall not be obligated to provide any Omitted Service if it does not, in its reasonable judgment, have adequate resources to provide such Omitted Service or if the provision of such Omitted Service would significantly disrupt the operation of its businesses.  Abbott and AbbVie shall cooperate and act in good faith to create a supplemental subsection of Exhibit A hereto for each Omitted Service in the form attached hereto as Exhibit B .  The applicable Provider and Recipient shall (i) amend Schedule 1 of the applicable Joinder Agreement to include such Omitted Service and (ii) promptly provide Notice of such amendment (including a copy thereof) to Abbott and AbbVie.  Each such supplemental subsection of Exhibit A hereto and each such amended Schedule 1 to such Joinder Agreement shall be deemed part of this Agreement as of the date of such agreement and the Omitted Services set forth therein shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

(b)                                  If, following the Effective Time and during the term of this Agreement, a Recipient identifies a service that, prior to the Effective Time, its applicable Provider or any of its Subsidiaries provided to such Recipient, but Abbott and AbbVie had mutually agreed that such service would not be provided under the terms of this Agreement (each such service, an “ Excluded Service ”), then such Recipient or Provider shall provide Notice thereof to Abbott and AbbVie, and Abbott and AbbVie shall cooperate and act in good faith to determine whether such Provider shall provide such Excluded Service to such Recipient under the terms of this Agreement.  If Abbott and AbbVie determine that such Provider shall provide such Excluded Service to such Recipient (each such Excluded Service, a “ Reinstated Service ”), then Abbott and AbbVie will act in good faith to create a supplemental subsection of Exhibit A hereto for each Reinstated Service in the form attached hereto as Exhibit B .  The applicable Provider and Recipient shall (i) amend Schedule 1 of the applicable Joinder Agreement to include such Reinstated Service and (ii) promptly provide Notice of such amendment (including a copy thereof) to Abbott and AbbVie.  Each such supplemental subsection of Exhibit A hereto and each such amended Schedule 1 to such Joinder Agreement shall be deemed part of this Agreement as of the date of such agreement and the Reinstated Services set forth therein shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

(c)                                   If, following the Effective Time and during the term of this Agreement, a Recipient identifies a service, other than an Omitted Service or an Excluded Service, that it desires for its applicable Provider or any of its Subsidiaries to provide to such Recipient (each such service, an “ Additional Service ”), then such Provider shall consider such request, in conjunction with Abbott and AbbVie; provided that nothing shall require such Provider to provide such Additional Service to such Recipient.  If such Provider consents to providing an Additional Service to such Recipient, then such Recipient or Provider shall provide Notice thereof to Abbott and AbbVie, and Abbott and AbbVie shall cooperate and act in good faith to create a supplemental subsection of Exhibit A hereto for each Additional Service in the form attached hereto as Exhibit B .  The applicable Provider and Recipient shall (i) amend Schedule 1 of the applicable Joinder Agreement to include such Additional Service and (ii) promptly provide Notice of such amendment (including a copy thereof) to Abbott and AbbVie.  Each such supplemental subsection of Exhibit A hereto and each such amended Schedule 1 to such Joinder

 

5


 

Agreement shall be deemed part of this Agreement as of the date of such agreement and the Additional Services set forth therein shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

Section 2.03.                           Performance of Services .

 

(a)                                  Each Provider shall perform and cause its Subsidiaries to perform all Services to be provided by such Provider in a manner that is based on its past practice and that is substantially similar in nature, quality and timeliness to the analogous services provided by Abbott to the Abbott Subsidiaries prior to the Commencement Date.  Each Provider shall, and shall cause its Subsidiaries to, perform its duties and responsibilities hereunder in good faith.

 

(b)                                  Nothing in this Agreement shall require a Provider to perform or cause to be performed any Service to the extent the manner of such performance would constitute a violation of applicable Laws, the Abbott Code of Business Conduct or any existing contract or agreement with a Third Party.  If a Provider is or becomes aware of any potential violation on the part of the Provider, such Provider shall use commercially reasonable efforts to promptly send a Notice to its applicable Recipient of such potential violation.  Each Provider and Recipient agrees to cooperate and use commercially reasonable efforts to obtain any necessary Third Party consents required under any existing contract or agreement with a Third Party to allow the applicable Provider to perform or cause to be performed any Service in accordance with the standards set forth in this Section 2.03 .  Any costs and expenses incurred by any Provider or Recipient or any of its respective Subsidiaries in connection with obtaining any such Third Party consent that is required to allow the applicable Provider to perform or cause to be performed (i) any Service (other than an Additional Service) shall be split between the applicable Provider and Recipient in accordance with such Parties’ respective utilization of the applicable Service at such time (except with respect to fees imposed by Third Parties to allow joint participation by the Provider and the Recipient under information technology contracts and licenses, which fees shall be split equally between the applicable Provider and the Recipient) and (ii) any Additional Service shall be solely the responsibility of the Recipient.  If, with respect to a Service, the applicable Provider and Recipient, despite the use of such commercially reasonable efforts, are unable to obtain a required Third Party consent or the performance of such Service by the applicable Provider would continue to constitute a violation of applicable Laws or the Abbott Code of Business Conduct, the applicable Provider shall use commercially reasonable efforts in good faith to provide such Services in a manner as closely as possible to the standards described in this Section 2.03 that would apply absent the exception provided for in the first sentence of this Section 2.03(b) .

 

(c)                                   No Provider shall be obligated to perform or to cause to be performed any Service in a volume or quantity in any calendar year that exceeds the highest volumes or quantities of analogous services provided to the applicable Recipient during calendar year 2012, as set forth in the 2012 plan (without reference to the transactions contemplated by the Separation and Distribution Agreement) (the “ Service Baseline Period ”).  If a Recipient requests that its Provider perform or cause to be performed any Service in a volume or quantity that exceeds the highest volumes or quantities of analogous services that were provided to such Recipient during the Service Baseline Period, then: (i) if such higher volume or quantity results from fluctuations occurring in the ordinary course of business of such Recipient, the applicable

 

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Provider shall use commercially reasonable efforts to provide such requested higher volume or quantity; and (ii) if such higher volume or quantity results from any other source, including an acquisition, merger, purchase or other business combination by such Recipient, then such Recipient or Provider shall provide Notice thereof to Abbott and AbbVie, and Abbott and AbbVie shall cooperate and act in good faith to determine whether the applicable Provider will be required to provide such requested higher volume or quantity.  If Abbott and AbbVie determine that the applicable Provider shall provide the requested higher volume or quantity then such higher volume or quantity shall be documented in a written agreement signed by the applicable Recipient and Provider who shall promptly provide Notice of such agreement (including a copy thereof) to Abbott and AbbVie.  The volume or quantity increases set forth in such written agreement shall be deemed a part of the “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement.

 

(d)                                  (i) No Provider or any of its Subsidiaries shall be required to perform or to cause to be performed any of the Services for the benefit of any Third Party or any other Person other than the applicable Recipient, and (ii) EXCEPT AS EXPRESSLY PROVIDED IN THIS SECTION 2.03 , EACH PARTY ACKNOWLEDGES AND AGREES THAT ALL SERVICES AND PRODUCTS ARE PROVIDED ON AN “AS IS” BASIS, THAT EACH RECIPIENT ASSUMES ALL RISK AND LIABILITY ARISING FROM OR RELATING TO ITS USE OF AND RELIANCE UPON THE SERVICES, AND THAT EACH PROVIDER MAKES NO OTHER REPRESENTATIONS OR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, WITH RESPECT TO THE SERVICES AND PRODUCTS.  EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

 

(e)                                   Each Party shall be responsible for its own compliance with any and all Laws applicable to its performance under this Agreement.  No Party shall knowingly take any action in violation of any such applicable Law that results in Liability being imposed on any other Party.

 

Section 2.04.                           Charges for Services .  Each Recipient shall pay to its applicable Provider a monthly fee for the Services (or category of Services, as applicable) (each fee constituting a “ Charge ” and, collectively, “ Charges ”) provided by such Provider or its applicable Subsidiaries, which Charges shall be agreed to by the applicable Provider and Recipient from time to time.  During the term of this Agreement, the amount of a Charge for any Services may adjust to the extent of:  (a) any adjustments mutually agreed to by the applicable Provider and Recipient; (b) any Charges applicable to any Omitted Services, Reinstated Services or Additional Services; and (c) in accordance with Section 2.08 , any proportional adjustment in the rates or charges imposed by any Third Party provider that is providing Services.  Together with any monthly invoice for Charges, each Provider shall provide its applicable Recipient with reasonable documentation, including any additional documentation reasonably requested by such Recipient to the extent such documentation is in such Provider’s or its Subsidiaries’ possession or control, to support the calculation of such Charges.

 

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Section 2.05.                           Reimbursement for Out-of-Pocket Expenses .  Each Recipient shall reimburse its applicable Provider for reasonable out-of-pocket costs and expenses incurred by such Provider or any of its Subsidiaries in connection with providing the Services (including reasonable travel-related expenses) to the extent that such costs and expenses are not reflected in the Charges for such Services; provided , however , that any such cost or expense not consistent with historical practice between such Provider and Recipient for any Service (including business travel and related expenses) shall require advance approval of such Recipient.  Any authorized travel-related expenses incurred in performing the Services shall be incurred and charged to the applicable Recipient in accordance with such Provider’s then applicable business travel policies.

 

Section 2.06.                           Changes to Services .

 

(a)                                  Except as provided in Section 2.08 and subject to the performance standards set forth in this Article II , each Provider may make changes from time to time in the manner of performing the Services if such Provider is making similar changes in performing analogous services for itself and if such Provider furnishes to its applicable Recipient reasonable prior Notice (in content and timing) respecting such changes; provided , however , that no Provider may modify any of its accounting policies or its foreign exchange rate setting process as defined in the B.2.0 policy that would directly or indirectly impact the Services without the prior written consent of its applicable Recipient (such consent not to be unreasonably withheld or delayed).  No such change shall affect the timeliness or quality of, or the Charges for, the applicable Service.  If any such change by a Provider reasonably requires its applicable Recipient to incur incremental costs and expenses in order to continue to receive and utilize the applicable Services in the same manner as such Recipient was receiving and utilizing such Service prior to such change, such Provider shall be required to reimburse such Recipient for all such reasonable costs and expenses.  Upon request of a Provider, the applicable Recipient shall provide such Provider with reasonable documentation, including any additional documentation reasonably requested by such Provider to the extent such documentation is in such Recipient’s or its Subsidiaries’ possession or control, to support the calculation of such incremental costs and expenses.

 

(b)                                  AbbVie acknowledges that it has received a copy of Abbott’s B.2.0 internal calendar for 2013 from Abbott. Prior to the commencement of each subsequent calendar year during the term of this Agreement, Abbott shall make available to AbbVie a copy of Abbott’s B.2.0 internal calendar for such calendar year (and AbbVie may request the same of Abbott if Abbott has not made such copy available to AbbVie prior to the commencement of the applicable subsequent calendar year).

 

(c)                                   Prior to 12:00 p.m. Central Time on the B.2.0 day of each calendar month during the term of this Agreement, Abbott shall make available to AbbVie a copy of Abbott’s foreign exchange rates determined in accordance with Abbott’s B.2.0 policy for such calendar month (and AbbVie may request the same of Abbott if Abbott has not made such copy available to AbbVie prior to 12:00 p.m. Central Time on the B.2.0 day of the applicable calendar month).

 

Section 2.07.                           Transitional Nature of Services .  Each Provider and applicable Recipient acknowledge the transitional nature of the Services and agree to cooperate in good faith and to

 

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use commercially reasonable efforts to effectuate a smooth transition of the Services from such Provider to such Recipient (or its designee).

 

Section 2.08.                           Use of Third Parties to Provide Services .  Each Provider may perform its obligations to provide a Service through agents, subcontractors or independent contractors, provided that the delegation of performance of the applicable Service does not impact the timeliness or quality of such Service, in accordance with the following:

 

(a)                                  Provider is Currently Using Third Parties as of the Effective Time .  If, as of the Effective Time, (i) the Provider is obtaining analogous services for itself from agents, subcontractors or independent contractors, or (ii) the Provider is obtaining services from agents, subcontractors or independent contractors which services such Provider shall only provide to its applicable Recipient under this Agreement and such Provider shall not otherwise require such analogous services for itself during the term of this Agreement, then the Charges for the applicable Services such Provider is obtaining from such Third Parties may be adjusted proportionally by such Provider pursuant to Section 2.04(c) to reflect any adjustment in the rates or charges imposed by the Third Party that is providing such Services; or

 

(b)                                  Provider Elects to Switch to Third Parties After the Effective Time .

 

(i)                                      If, following the Effective Time, the Provider elects to obtain analogous services for itself from agents, subcontractors or independent contractors (A) such Provider shall furnish to its applicable Recipient reasonable prior Notice (in content and timing) respecting such use of Third Parties, and (B) the Charges for the applicable Services such Provider is obtaining from such Third Parties may be adjusted proportionally by such Provider pursuant to Section 2.04(c) to reflect any adjustment in the rates or charges imposed by the Third Party that is providing such Services; and

 

(ii)                                   If, however, following the Effective Time, the Provider is not obtaining analogous services for itself from agents, subcontractors or independent contractors (A) such Provider shall furnish to its applicable Recipient reasonable prior Notice (in content and timing) respecting such use of Third Parties, and (B) the Charges for the applicable Services such Provider is providing through such Third Parties appointed following the Effective Time may not be adjusted by such Provider as a result of any adjustments in the rates or charges imposed by such Third Parties.

 

Notwithstanding the foregoing, no Provider shall be relieved of its obligations under this Agreement by use of such agents, subcontractors or independent contractors.

 

Section 2.09.                           Joinder Agreement .  Each of Abbott and AbbVie shall cause their respective Subsidiaries who are to provide or receive Services to become a party to this Agreement and adopt this Agreement with the same force and effect as if it were originally a party hereto by executing a Joinder Agreement substantially in the form attached as Exhibit C hereto (each, a “ Joinder Agreement ”).  Each such Joinder Agreement executed pursuant to this Section 2.09 shall be deemed part of this Agreement as of the date of such Joinder Agreement.

 

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ARTICLE III

 

OTHER ARRANGEMENTS

 

Section 3.01.                           Access .

 

(a)                                  AbbVie shall, and shall cause its Subsidiaries to, allow Abbott and its Subsidiaries and their respective Representatives reasonable access to the facilities of AbbVie and its Subsidiaries that is necessary for Abbott and its Subsidiaries to fulfill their obligations under this Agreement.  In addition to the foregoing right of access, AbbVie shall, and shall cause its Subsidiaries to, afford Abbott, its Subsidiaries and their respective Representatives, upon reasonable advance notice, reasonable access during normal business hours to the facilities, Information, systems, infrastructure and personnel of AbbVie and its Subsidiaries as reasonably necessary for Abbott to verify the adequacy of internal controls over information technology, reporting of financial data and related processes employed in connection with the Services being provided by AbbVie or its Subsidiaries, including in connection with verifying compliance with Section 404 of the Sarbanes-Oxley Act of 2002; provided that (i) such access shall not unreasonably interfere with any of the business or operations of AbbVie or any of its Subsidiaries and (ii) in the event that AbbVie determines that providing such access could be commercially detrimental, violate any Law or agreement, or waive any attorney-client privilege, then Abbott and AbbVie shall use commercially reasonable efforts to permit such access in a manner that avoids any such harm or consequence.  Abbott agrees that all of its and its Subsidiaries’ employees shall, and that it shall use commercially reasonable efforts to cause its Representatives’ employees to, when on the property of AbbVie and its Subsidiaries, or when given access to any facilities, Information, systems, infrastructure or personnel of AbbVie and its Subsidiaries, conform to the policies and procedures of AbbVie and any of its Subsidiaries, as applicable, concerning health, safety, conduct and security which are made known to Abbott from time to time.

 

(b)                                  Abbott shall, and shall cause its Subsidiaries to, allow AbbVie and its Subsidiaries and their respective Representatives reasonable access to the facilities of Abbott and its Subsidiaries that is necessary for AbbVie and its Subsidiaries to fulfill their obligations under this Agreement.  In addition to the foregoing right of access, Abbott shall, and shall cause its Subsidiaries to, afford AbbVie, its Subsidiaries and their respective Representatives, upon reasonable advance notice, reasonable access during normal business hours to the facilities, Information, systems, infrastructure, and personnel of Abbott and its Subsidiaries as reasonably necessary for AbbVie to verify the adequacy of internal controls over information technology, reporting of financial data and related processes employed in connection with the Services being provided by Abbott or its Subsidiaries, including in connection with verifying compliance with Section 404 of the Sarbanes-Oxley Act of 2002; provided that (i) such access shall not unreasonably interfere with any of the business or operations of Abbott or any of its Subsidiaries and (ii) in the event that Abbott determines that providing such access could be commercially detrimental, violate any Law or agreement, or waive any attorney-client privilege, then Abbott and AbbVie shall use commercially reasonable efforts to permit such access in a manner that avoids any such harm or consequence.  AbbVie agrees that all of its and its Subsidiaries’ employees shall, and that it shall use commercially reasonable efforts to cause its Representatives’ employees to, when on the property of Abbott and its Subsidiaries, or when

 

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given access to any facilities, Information, systems, infrastructure or personnel of Abbott and its Subsidiaries, conform to the policies and procedures of Abbott and any of its Subsidiaries, as applicable, concerning health, safety, conduct and security which are made known to AbbVie from time to time.

 

ARTICLE IV

 

BILLING; TAXES

 

Section 4.01.                           Procedure .  Charges for the Services shall be charged to and payable by the Recipient.  Amounts payable pursuant to the terms of this Agreement shall be paid by wire transfer (or such other method of payment as may be agreed between the applicable Recipient and Provider) to the Provider, as directed by the Provider, on a monthly basis, which amounts shall be due within sixty (60) days after the date of invoice.  All amounts due and payable hereunder shall be invoiced and paid in the local currency of the Provider.

 

Section 4.02.                           Late Payments .  Charges not paid when due pursuant to this Agreement (and any amounts billed or otherwise invoiced or demanded and properly payable that are not paid within sixty (60) days of the date of such bill, invoice or other demand) shall accrue interest at a rate per annum equal to the Prime Rate plus 2%, or the maximum legal rate, whichever is lower (the “ Interest Payment ”).

 

Section 4.03.                           Taxes .  Without limiting any provisions of this Agreement, the Recipient shall bear any and all Taxes and other similar charges (and any related interest and penalties) imposed on, or payable with respect to, any fees or charges, including any Charges, payable by it pursuant to this Agreement, including all sales, use, value-added, and similar Taxes, but excluding Taxes based on such Provider’s net income.  Notwithstanding anything to the contrary in the previous sentence or elsewhere in this Agreement, the Recipient shall be entitled to withhold from any payments to the Provider any such Taxes that the Recipient is required by Law to withhold and shall pay such Taxes to the applicable Tax Authority.

 

Section 4.04.                           No Set-Off .  Except as mutually agreed to in writing by Abbott and AbbVie, no Party or any of its Affiliates shall have any right of set off or other similar rights with respect to (a) any amounts received pursuant to this Agreement; or (b) any other amounts claimed to be owed to the other Party or any of its Subsidiaries arising out of this Agreement.

 

ARTICLE V

 

TERM AND TERMINATION

 

Section 5.01.                           Term .  With respect to each Recipient and its applicable Provider of the applicable Services, this Agreement shall commence on the commencement of the applicable Service Period and shall terminate upon the earlier to occur of:  (a) the last date on which such Provider is obligated to provide any Service to such Recipient in accordance with the terms of this Agreement; or (b) the mutual written agreement of Abbott and AbbVie to terminate this Agreement in its entirety.  Unless otherwise terminated pursuant to Section 5.02 , this Agreement

 

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shall terminate with respect to any Service for a given Recipient at the close of business on the last day of the Service Period for such Service for such Recipient.

 

Section 5.02.                           Early Termination .

 

(a)                                  Without prejudice to any Recipient’s rights with respect to a Force Majeure, any Recipient may from time to time terminate this Agreement with respect to the entirety of any individual Service but not a portion thereof:

 

(i)                                      for any reason or no reason, upon the giving of an advance Notice to the Provider of such Service not less than the shorter of (A) one hundred eighty (180) days, or (B) one-half the original Service Period for such Service; provided , however , that any such termination may only be effective as of the last day of a month; or

 

(ii)                                   if the Provider of such Service has failed to perform any of its material obligations under this Agreement with respect to such Service, and such failure shall continue to exist forty five (45) days after receipt by such Provider of Notice of such failure from the Recipient; provided , however , that any such termination may only be effective as of the last day of a month; and provided , further , that the Recipient shall not be entitled to terminate the Agreement with respect to the applicable Service if, as of the end of such forty five (45)-day period, there remains a good faith Dispute between such Provider and Recipient (undertaken in accordance with the terms of Section 9.07 ) as to whether the Provider has cured the applicable breach.

 

(b)                                  Any Provider may terminate this Agreement with respect to any individual Service, but not a portion thereof, at any time upon prior Notice to the applicable Recipient if such Recipient has failed to perform any of its material obligations under this Agreement relating to such Services, including making payment of Charges for such Service when due, and such failure shall continue uncured for a period of forty five (45) days after receipt by such Recipient of a Notice of such failure from the Provider; provided , however , that any such termination may only be effective as of the last day of a month; and provided , further , that the Provider shall not be entitled to terminate this Agreement with respect to the applicable Service if, as of the end of such forty five (45)-day period, there remains a good faith Dispute between such Provider and Recipient (undertaken in accordance with the terms of Section 9.07 ) as to whether the Recipient has cured the applicable breach.  If a Provider has terminated a Service in accordance with the previous sentence, such Provider shall, without the consent of the Recipient, amend Schedule 1 of the applicable Joinder Agreement to reflect any terminated Service by indicating the early termination date with respect to such terminated Service for such Recipient and shall promptly provide Notice of such amendment (including a copy thereof) to Abbott, AbbVie and the applicable Recipient.

 

Section 5.03.                           Reduction of Services .  Any Recipient may from time to time request a reduction in part of the scope or amount of any Service; provided that any such reduction may only take effect as of the end of a month.  If requested to do so by a Recipient by Notice to Abbott and AbbVie, Abbott and AbbVie shall discuss in good faith appropriate adjustments to the relevant Charges in light of all relevant factors.  If, after such discussions, Abbott and AbbVie do not approve any requested reduction of the scope or amount of any Service and the

 

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relevant Charges in connection therewith, then (a) there shall be no change to the Charges under this Agreement and (b) unless the applicable Recipient and Provider otherwise agree in writing, there shall be no change to the scope or amount of any Services under this Agreement.  If, after such discussions, Abbott and AbbVie approve any reduction of Service, such reduction of Service shall be documented in a written agreement executed on behalf of the applicable Recipient and Provider and such Recipient and Provider shall promptly provide Notice of such agreement (including a copy thereof) to Abbott and AbbVie.  Additionally, in connection with any such reduction of Service, Abbott and AbbVie may approve an appropriate reduction to the Charges related to the applicable reduced Service.

 

Section 5.04.                           Extension of Services .

 

(a)                                  Each Recipient may request to extend the Service Period of any Service (each such extension, a “ Service Extension ”) one time for each Service unless Abbott and AbbVie shall authorize additional extensions, by providing the Provider of such Service with advance Notice not less than the shorter of (i) one hundred eighty (180) days, or (ii) one-half of the original Service Period for such Service.  Notwithstanding the foregoing, if any Provider and Recipient shall first execute a Joinder Agreement after June 30, 2014, the Service Period for the Services provided by such Provider to such Recipient shall automatically be deemed to terminate on December 31, 2015, unless such Recipient and Provider agree in their applicable Joinder Agreement to a shorter Service Period of any Service to be provided to such Recipient by such Provider, in which case such shorter Service Period shall apply to the particular Service.

 

(b)                                  If the Recipient (other than a Recipient who first executed a Joinder Agreement after June 30, 2014) is requesting a Service Extension for a particular Service for the first time and the requested Service Extension is for a period of twelve (12) months or less past the originally scheduled expiration of the Service Period for the applicable Service, then the Provider shall be obligated to provide such requested Service Extension and the applicable Recipient and Provider shall in good faith (i) negotiate the terms of an amendment to the applicable Joinder Agreement and promptly provide Notice of such amendment (including a copy thereof) to Abbott and AbbVie, which amendment shall be consistent with the terms of the applicable Service, and (ii) determine the costs and expenses (which shall not include any Charges payable under this Agreement), if any, that would be incurred by such Provider or Recipient, as the case may be, in connection with the provision of such Service Extension, which costs and expenses shall be borne solely by the Recipient.  If (A) the requested Service Extension is for a period of longer than twelve (12) months past the originally scheduled expiration of the Service Period for the applicable Service or (B) the applicable Recipient has previously requested a Service Extension for the particular Service that such Recipient is currently requesting a Service Extension, then such Recipient or Provider shall provide Notice of such request to Abbott and AbbVie, and Abbott and AbbVie shall cooperate and act in good faith to determine whether the Provider shall provide the applicable Service for the requested Service Extension period.  If Abbott and AbbVie determine that the Provider shall provide such Service during the requested Service Extension period, then the applicable Recipient and Provider shall in good faith (1) negotiate the terms of an amendment to Schedule 1 of the applicable Joinder Agreement and promptly provide Notice of such amendment (including a copy thereof) to Abbott and AbbVie, which amendment shall be consistent with the terms of the applicable Service, and (2) determine the costs and expenses (which shall not include any Charges payable

 

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under this Agreement), if any, that would be incurred by such Provider or Recipient, as the case may be, in connection with the provision of such Service Extension, which costs and expenses shall be borne solely by the Recipient.

 

(c)                                   Notwithstanding anything in this Agreement to the contrary, that portion of the Service described on Exhibit A-13 (the “ Accounting, Reporting & Financial Services ”) which relates solely to the applicable Provider’s obligation under this Agreement to collect amounts owed by any Third Party with respect to the AbbVie Business pursuant to a contract between such Third Party, on the one hand, and such Provider alone, on the other hand (such portion of such Service, the “ Collection Service ”) shall be deemed automatically extended without further action on the part of the applicable Provider or Recipient until the earlier of (i) such date when ninety-five percent (95%) of all amounts owed under all such contracts with respect to the AbbVie Business as of the third (3 rd ) anniversary of the Effective Time have been collected and (ii) the seventh (7 th ) anniversary of the Effective Time.

 

Section 5.05.                           Interdependencies .  The Parties acknowledge and agree that (i) there may be interdependencies among the Services being provided under this Agreement, (ii) upon the request of any Provider or Recipient by Notice to Abbott and AbbVie, Abbott and AbbVie shall cooperate and act in good faith to determine whether (A) any such interdependencies exist with respect to the particular Service that such Provider or Recipient is seeking to terminate, reduce part of the scope or amount of, or extend, as applicable, in accordance with Section 5.02 , Section 5.03 or Section 5.04 , respectively, and (B) in the case of a termination or reduction, the Provider’s ability to provide a particular Service in accordance with this Agreement would be materially and adversely affected by such termination, or reduction in part of the scope or amount, of another Service, as applicable, in accordance with Section 5.02 or Section 5.03 , respectively, prior to the expiration of the period of the maximum duration for such Service, and (iii) in the event that Abbott and AbbVie have determined that such interdependencies exist (and, in the case of a termination or reduction, as applicable, that the Provider’s ability to provide a particular Service in accordance with this Agreement would be materially and adversely affected by the termination, or reduction in part of the scope or amount, of another Service, as applicable, in accordance with Section 5.02 or Section 5.03 , respectively, prior to the expiration of the period of the maximum duration for such Service), the applicable Provider and Recipient shall negotiate in good faith to amend Schedule 1 of the applicable Joinder Agreement relating to the termination dates of such impacted Services and shall promptly provide Notice of such amendment (including a copy thereof) to Abbott and AbbVie.  Each such amended Joinder Agreement pursuant to this Section 5.02 shall be deemed part of this Agreement as of the date of such amendment.

 

Section 5.06.                           Effect of Termination .  Upon the termination of any Service for any Recipient pursuant to this Agreement, the Provider of the terminated Service shall have no further obligation to provide the terminated Service to such Recipient, and such Recipient shall have no obligation to pay any future Charges relating to any such Service; provided , however , that the Recipient shall remain obligated to the relevant Provider for the Charges owed and payable in respect of Services provided prior to the effective date of termination for such Service.  In connection with the termination of any Service, the provisions of this Agreement not relating solely to such terminated Service shall survive any such termination, and in connection with a termination of this Agreement, Article I , this Article V , Article VII and Article IX , all

 

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confidentiality obligations under this Agreement and Liability for all due and unpaid Charges, shall continue to survive indefinitely.

 

Section 5.07.                           Information Transmission .  Each Provider, on behalf of itself and its respective Subsidiaries, shall use commercially reasonable efforts to provide or make available, or cause to be provided or made available, to its applicable Recipient, in accordance with Section 6.01(a) of the Separation and Distribution Agreement, any Information received or computed by the Provider for the benefit of such Recipient concerning the relevant Service during the Service Period; provided , however , that, except as otherwise agreed to in writing by the Provider and Recipient (a) no Provider shall have any obligation to provide or cause to provide Information in any non-standard format, (b) the Provider and its Subsidiaries shall be reimbursed for their reasonable costs in accordance with Section 6.01(c) of the Separation and Distribution Agreement for creating, gathering, copying, transporting and otherwise providing such Information, and (c) the Provider shall use commercially reasonable efforts to maintain any such Information in accordance with Section 6.03 of the Separation and Distribution Agreement.

 

ARTICLE VI

 

CONFIDENTIALITY; PROTECTIVE ARRANGEMENTS

 

Section 6.01.                           Abbott and AbbVie Obligations .  Subject to Section 6.04 , Abbott, on behalf of itself and each of the Abbott Subsidiaries, on the one hand, and AbbVie, on behalf of itself and each of the AbbVie Subsidiaries, on the other hand, agrees to hold, and to cause its respective Representatives to hold, in strict confidence, with at least the same degree of care that applies to Abbott’s confidential and proprietary information pursuant to policies in effect as of the Effective Time, all confidential and proprietary information concerning the other Party (or its business) and the other Party’s Subsidiaries (or their respective businesses) that is either in its possession (including confidential and proprietary information in its possession prior to the Effective Time) or furnished by such other Party or such other Party’s Subsidiaries or their respective Representatives at any time pursuant to this Agreement, and shall not use any such confidential and proprietary information other than for such purposes as may be expressly permitted hereunder, except, in each case, to the extent that such confidential and proprietary information has been (a) in the public domain or generally available to the public, other than as a result of a disclosure by such Party or any of its Subsidiaries or any of their respective Representatives in violation of this Agreement; (b) later lawfully acquired from other sources by such Party or any of its Subsidiaries, which sources are not themselves bound by a confidentiality obligation or other contractual, legal or fiduciary obligation of confidentiality with respect to such confidential and proprietary information; or (c) independently developed or generated without reference to or use of the respective proprietary or confidential information of such other Party or any of its Subsidiaries.  If any confidential and proprietary information of Abbott or any of its Subsidiaries is disclosed to AbbVie or any of its Subsidiaries in connection with providing the Services, then such disclosed confidential and proprietary information shall be used only as required to perform the Services.  If any confidential and proprietary information of AbbVie or any of its Subsidiaries is disclosed to Abbott or any of its Subsidiaries in connection with providing the Services, then such disclosed confidential and proprietary information shall be used only as required to perform such Services.

 

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Section 6.02.                           No Release .  Each Party agrees (a) not to release or disclose, or permit to be released or disclosed, any information addressed in Section 6.01 to any other Person, except its Representatives who need to know such information in their capacities as such, and except in compliance with Section 6.04 , and (b) to use commercially reasonable efforts to maintain any such information in accordance with Section 6.03 of the Separation and Distribution Agreement.

 

Section 6.03.                           Third Party Information; Privacy and Data Protection Laws .  Each Party acknowledges that it and its respective Subsidiaries may presently have and, following the Effective Time, may gain access to or possession of confidential or proprietary information of, or personal information relating to, Third Parties (a) that was received under confidentiality or non-disclosure agreements entered into between such Third Parties, on the one hand, and the other Party or the other Party’s Subsidiaries, on the other hand, prior to the Effective Time; or (b) that, as between the Parties, was originally collected by the other Party or the other Party’s Subsidiaries and that may be subject to and protected by privacy, data protection or other applicable Laws.  As provided in more detail in a data protection agreement to be entered into between Abbott and AbbVie as of the Effective Time, each of Abbott and AbbVie agrees that it shall hold, protect and use, and shall cause its Subsidiaries and its and its Subsidiaries’ respective Representatives to hold, protect and use, in strict confidence the confidential and proprietary information of, or personal information relating to, Third Parties in accordance with privacy, data protection or other applicable Laws and the terms of any agreements that were either entered into before the Effective Time or affirmative commitments or representations that were made before the Effective Time by, between or among such other Party or such other Party’s Subsidiaries, on the one hand, and such Third Parties, on the other hand.

 

Section 6.04.                           Protective Arrangements .  In the event that any Party or any of its Affiliates is requested or required (by oral question, interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) by any Governmental Authority or pursuant to applicable Law to disclose or provide any confidential or proprietary information of the other Party that is subject to the confidentiality provisions hereof, or to disclose or provide any Personal Data that it processes on behalf of the other Party in accordance with the data protection agreement to be entered into between Abbott and AbbVie as of the Effective Time, such Party shall, unless prohibited by such request or requirement of the applicable Governmental Authority or under applicable Law, provide such other Party with Notice of such request or demand as promptly as practicable under the circumstances so that such other Party shall have an opportunity to seek an appropriate protective order, at such other Party’s own cost and expense.  In the event that such other Party fails to receive such appropriate protective order in a timely manner and the Party receiving the request or demand reasonably determines that its failure to disclose or provide such information shall actually prejudice the Party receiving the request or demand, then the Party that received such request or demand may thereafter disclose or provide information to the extent required by such Law (as so advised by counsel) or by lawful process or such Governmental Authority.

 

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ARTICLE VII

 

LIMITED LIABILITY AND INDEMNIFICATION

 

Section 7.01.                           Limitations on Liability .

 

(a)                                  SUBJECT TO SECTION 7.02 , THE LIABILITIES OF EACH PROVIDER AND ITS SUBSIDIARIES AND THEIR RESPECTIVE REPRESENTATIVES, COLLECTIVELY, UNDER THIS AGREEMENT FOR ANY ACT OR FAILURE TO ACT IN CONNECTION HEREWITH (INCLUDING THE PERFORMANCE OR BREACH OF THIS AGREEMENT), OR FROM THE SALE, DELIVERY, PROVISION OR USE OF ANY SERVICES PROVIDED UNDER OR CONTEMPLATED BY THIS AGREEMENT, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY) OR OTHERWISE, SHALL NOT EXCEED SUCH PROVIDER’S PROFITS FOR PERFORMING SERVICES HEREUNDER, WHICH SHALL BE DEEMED TO BE EQUAL TO THE AMOUNT OF THE MARK-UP RECEIVED BY SUCH PROVIDER DURING THE PREVIOUS TWELVE (12) MONTH PERIOD.

 

(b)                                  IN NO EVENT SHALL ANY PARTY, ITS SUBSIDIARIES OR THEIR RESPECTIVE REPRESENTATIVES BE LIABLE TO ANY OTHER PARTY FOR INDIRECT, EXEMPLARY, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES IN CONNECTION WITH THE PERFORMANCE OF THIS AGREEMENT, EVEN IF THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND EACH PARTY HEREBY WAIVES ON BEHALF OF ITSELF, ITS SUBSIDIARIES AND ITS REPRESENTATIVES ANY CLAIM FOR SUCH DAMAGES, INCLUDING ANY CLAIM FOR PROPERTY DAMAGE OR LOST PROFITS, WHETHER ARISING IN CONTRACT, TORT OR OTHERWISE.

 

(c)                                   The foregoing limitations on Liability in this Section 7.01 shall not apply to any Party’s Liability for breaches of confidentiality under Article VI or any Party’s obligations under Section 7.03 .

 

(d)                                  The limitations in Section 7.01(a) and Section 7.01(b) shall not apply in respect of any Liability arising out of or in connection with the gross negligence, willful misconduct, or fraud of or by the Party to be charged.

 

Section 7.02.                           Obligation to Re-Perform; Liabilities .  In the event of any breach of this Agreement by any Provider with respect to the provision of any Services (with respect to which the Provider can reasonably be expected to re-perform in a commercially reasonable manner), such Provider shall (a) promptly correct in all material respects such error, defect or breach or re-perform in all material respects such Services at the request of its applicable Recipient and at the sole cost and expense of the Provider and (b) subject to the limitations set forth in Section 7.01 , reimburse such Recipient and its Subsidiaries and Representatives for Liabilities attributable to such breach by such Provider.  The remedy set forth in this Section 7.02 shall be the sole and exclusive remedy of the Recipient for any such breach of this Agreement.  Any request for re-performance in accordance with this Section 7.02 by any Recipient must be in writing and specify in reasonable detail the particular error, defect or breach, and such request must be made

 

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no more than one (1) month from the later of the date on which such breach occurred and the date on which such breach was reasonably discovered by the Recipient.

 

Section 7.03.                           Third Party Claims .  Each Recipient shall indemnify, defend and hold harmless its applicable Provider, its Subsidiaries and each of their respective Representatives, and each of the successors and assigns of any of the foregoing (collectively, the “ Provider Indemnitees ”), from and against any and all claims of Third Parties relating to, arising out of or resulting from such Provider’s furnishing or failing to furnish the Services provided for in this Agreement, other than (a) Third Party claims arising out of the gross negligence, willful misconduct or fraud of any Provider Indemnitee and (b) as set forth in Section 2.03(b) .

 

Section 7.04.                           Indemnification Procedures .  The provisions of Article IV of the Separation and Distribution Agreement shall govern claims for indemnification under this Agreement; provided that, for purposes of this Section 7.04 , in the event of any conflict between the provisions of Article IV of the Separation and Distribution Agreement and this Article VII , the provisions of this Agreement shall control.

 

ARTICLE VIII

 

TRANSITION COMMITTEE; ABBOTT AND ABBVIE RIGHTS

 

Section 8.01.                           Establishment .  Pursuant to the Separation and Distribution Agreement, a Transition Committee is to be established by Abbott and AbbVie to, among other things, monitor and manage matters arising out of or resulting from this Agreement.

 

Section 8.02.                           Rights of Abbott and AbbVie .  Notwithstanding any provision in this Agreement to the contrary, each Provider and Recipient acknowledges and agrees that Abbott and AbbVie shall have the right to review and amend any prior actions taken, decisions made or amendments or modifications agreed to, by each Provider and Recipient, and jointly to proscribe that any Provider and applicable Recipient take such actions or make such amendments or modifications as Abbott and AbbVie deem appropriate in order to effect the intent and purpose of this Agreement and the transactions contemplated hereby.  Each Provider and Recipient shall take, or cause to be taken, any and all reasonable actions that Abbott and AbbVie jointly may reasonably request to carry out the intent and purpose of this Article VIII .

 

ARTICLE IX

 

MISCELLANEOUS

 

Section 9.01.                           Mutual Cooperation .  The Parties and their respective Subsidiaries shall cooperate with each other in connection with the performance of the Services hereunder; provided , however , that such cooperation shall not unreasonably disrupt the normal operations of the Parties and their respective Subsidiaries; and, provided , further , that this Section 9.01 shall not require any Party to incur any out-of-pocket costs or expenses unless and except as expressly provided in this Agreement or otherwise agreed to in writing by Abbott and AbbVie.

 

Section 9.02.                           Title to Intellectual Property .  Except as expressly provided for under the terms of this Agreement, each Recipient acknowledges that it shall acquire no right, title or

 

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interest (including any license rights or rights of use) in any intellectual property which is owned or licensed by any Provider, by reason of the provision of the Services provided hereunder.  No Recipient shall remove or alter any copyright, trademark, confidentiality or other proprietary notices that appear on any intellectual property owned or licensed by any Provider, and each Recipient shall reproduce any such notices on any and all copies thereof.  No Recipient shall attempt to decompile, translate, reverse engineer or make excessive copies of any intellectual property owned or licensed by any Provider, and each Recipient shall promptly notify such Provider of any such attempt, regardless of whether by the Recipient or any Third Party, of which the Recipient becomes aware.

 

Section 9.03.                           Force Majeure .  No Party shall be deemed in default of this Agreement for failure to fulfill any obligation so long as and to the extent to which any delay or failure in the fulfillment of such obligations is prevented, frustrated, hindered or delayed as a consequence of circumstances of Force Majeure.  In the event of any such excused delay, the time for performance shall be extended for a period equal to the time lost by reason of the delay unless this Agreement has previously been terminated under Article V or under this Section 9.03 .  Any Party claiming the benefit of this provision shall, as soon as reasonably practicable after the occurrence of any such event, (a) provide Notice to the other Party of the nature and extent of any such Force Majeure condition; and (b) use commercially reasonable efforts to remove any such causes and resume performance under this Agreement as soon as reasonably practicable unless this Agreement has previously been terminated under Article V or under this Section 9.03 .  During the period of a Force Majeure, the applicable Recipient shall be (i) relieved of the obligation to pay Charges for such Service(s) throughout the duration of such Force Majeure and (ii) entitled to permanently terminate such Service(s) (and shall be relieved of the obligation to pay Charges for such Service(s) throughout the duration of such Force Majeure) if a Force Majeure shall continue to exist for more than thirty (30) consecutive days, it being understood that such Recipient shall not be required to provide any advance notice of such termination to the Provider.

 

Section 9.04.                           Independent Contractors .  The Parties each acknowledge that they are separate entities, each of which has entered into this Agreement for independent business reasons.  The relationships of the Parties hereunder are those of independent contractors and nothing contained herein shall be deemed to create a joint venture, partnership or any other relationship.  Employees performing services hereunder do so on behalf of, under the direction of, and as employees of, the applicable Provider, and the applicable Recipient shall have no right, power or authority to direct such employees.

 

Section 9.05.                           Third Party Beneficiaries .  Except as provided in Article VII with respect to Provider Indemnitees, (a) the provisions of this Agreement are solely for the benefit of the Parties, their Subsidiaries and their permitted successors and assigns, and are not intended to confer upon any other Person except the Parties, their Subsidiaries and their permitted successors and assigns, any rights or remedies hereunder; and (b) there are no other Third Party beneficiaries of this Agreement and this Agreement shall not provide any other Third Party with any remedy, claim, Liability, reimbursement, claim of action or other right in excess of those existing without reference to this Agreement.

 

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Section 9.06.                           Governing Law .  This Agreement shall be governed by and construed and interpreted in accordance with the Laws of the State of Delaware, irrespective of the choice of Laws principles of the State of Delaware, as to all matters, including matters of validity, construction, effect, enforceability, performance and remedies.

 

Section 9.07.                           Dispute Resolution .

 

(a)                                  In the event of any controversy, dispute or claim (a “ Dispute ”) arising out of or relating to any Party’s rights or obligations under this Agreement (whether arising in contract, tort or otherwise) or calculation or allocation of the costs of any Service, or otherwise arising out of or relating in any way to this Agreement (including the interpretation or validity of this Agreement), such Dispute shall be resolved in accordance with the dispute resolution process referred to in Section 7.01 to the Separation and Distribution Agreement.

 

(b)                                  In any Dispute regarding the amount of a Charge, if such Dispute is finally resolved pursuant to the dispute resolution process set forth or referred to in Section 9.07(a) and it is determined that the Charge that the Provider has invoiced the Recipient, and that the Recipient has paid to the Provider, is greater or less than the amount that the Charge should have been, then (i) if it is determined that the Recipient has overpaid the Charge, the Provider shall within five (5) business days after such determination reimburse the Recipient an amount of cash equal to such overpayment, plus the Interest Payment, accruing from the date of payment by the Recipient to the time of reimbursement by the Provider; and (ii) if it is determined that the Recipient has underpaid the Charge, the Recipient shall within five (5) business days after such determination reimburse the Provider an amount of cash equal to such underpayment, plus the Interest Payment, accruing from the date such payment originally should have been made by the Recipient to the time of payment by the Recipient.

 

Section 9.08.                           Specific Performance .  Subject to Section 9.07 , in the event of any actual or threatened default in, or breach of, any of the terms, conditions and provisions of this Agreement, the Party or Parties who are or are to be thereby aggrieved shall have the right to specific performance and injunctive or other equitable relief (on an interim or permanent basis) of its rights under this Agreement, in addition to any and all other rights and remedies at Law or in equity, and all such rights and remedies shall be cumulative.  The Parties agree that the remedies at Law for any breach or threatened breach, including monetary damages, may be inadequate compensation for any loss and that any defense in any Proceeding for specific performance that a remedy at Law would be adequate is waived.  Unless otherwise agreed in writing, the Parties shall continue to provide Services and honor all other commitments under this Agreement during the course of dispute resolution pursuant to the provisions of Section 9.07 and this Section 9.08 with respect to all matters subject to such Dispute; provided , however , that this obligation shall only exist during the term of this Agreement.

 

Section 9.09.                           Interpretation .  Words in the singular shall be deemed to include the plural and vice versa and words of one gender shall be deemed to include the other genders as the context requires.  The terms “hereof,” “herein,” and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole (including all of the Schedules and Exhibits hereto and thereto) and not to any particular provision of this Agreement.  Section, Exhibit and Schedule references are to the Sections, Exhibits, and

 

20



 

Schedules to this Agreement unless otherwise specified.  Unless otherwise stated, all references to any agreement shall be deemed to include the exhibits, schedules and annexes to such agreement.  The word “including” and words of similar import when used in this Agreement shall mean “including, without limitation,” unless the context otherwise requires or unless otherwise specified.  The word “or” shall not be exclusive.  Unless otherwise specified in a particular case, the word “days” refers to calendar days.  References herein to this Agreement or any other agreement contemplated herein shall be deemed to refer to this Agreement or such other agreement as of the date on which it is executed and as it may be amended, modified or supplemented thereafter, unless otherwise specified.  References to the performance, discharge or fulfillment of any Liability in accordance with its terms shall have meaning only to the extent such Liability has terms.  If the Liability does not have terms, the reference shall mean performance, discharge or fulfillment of such Liability.

 

Section 9.10.                           Headings .  The Article, Section and Paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

 

Section 9.11.                           Amendment .  Except with respect to the execution of any Joinder Agreement, or the amendment, supplementation or modification thereof in accordance with the terms and provisions of such Joinder Agreement, no provisions of this Agreement shall be deemed amended, supplemented or modified unless such amendment, supplement or modification is in writing and signed by an authorized representative of each of Abbott and AbbVie.  No provisions of this Agreement shall be deemed waived unless such waiver is in writing and signed by the authorized representative of the Party against whom it is sought to be enforced.

 

Section 9.12.                           Assignability .  This Agreement shall not be assigned without the prior written consent of Abbott and AbbVie, except that:

 

(a)                                  each Party may assign all of its rights and obligations under this Agreement to any of its Subsidiaries; provided , however , that no such assignment shall release the assigning Party from any Liability under this Agreement; and

 

(b)                                  in connection with (i) the divestiture of all or substantially all of the assets of a Recipient or Provider to a Third Party or (ii) a Change of Control of a Recipient or Provider, the applicable Recipient or Provider may assign to such Third Party its rights and obligations as a Recipient or Provider under this Agreement; provided , however , that (x) no such assignment shall release the assigning Party from any Liability under this Agreement, (y) any and all costs and expenses incurred by any Party in connection with such assignment (including in connection with clause (z) of this proviso) shall be borne solely by the assigning Party, and (z) Abbott and AbbVie shall in good faith negotiate any amendments to this Agreement, including the Exhibits and Schedules to this Agreement, that may be reasonably necessary in order to assign such Services.

 

Section 9.13.                           Audit Assistance .  Each of the Parties and their respective Subsidiaries are or may be subject to regulation and audit by a Governmental Authority, standards organizations, customers or other parties to contracts with such Parties or their respective Subsidiaries under

 

21



 

applicable Law, standards or contract provisions.  If a Governmental Authority, standards organization, customer or other party to a contract with a Party or its Subsidiary exercises its right to examine or audit such Party’s or its Subsidiary’s books, records, documents or accounting practices and procedures pursuant to such applicable Law, standards or contract provisions, and such examination or audit relates to the Services, then the other Parties shall provide, at the sole cost and expense of the requesting Party, all assistance reasonably requested by the Party that is subject to the examination or audit in responding to such examination or audits or requests for information, to the extent that such assistance or information is within the reasonable control of the cooperating Party and is related to the Services.

 

Section 9.14.                           Survival of Covenants .  Except as expressly set forth in this Agreement, the covenants and other agreements contained in this Agreement, and Liability for the breach of any obligations contained herein, shall survive the Effective Time and shall remain in full force and effect thereafter.

 

Section 9.15.                           Subsidiaries .  Abbott shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth herein and in any Joinder Agreement to be performed by an Abbott Subsidiary and AbbVie shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth herein and in any Joinder Agreement to be performed by an AbbVie Subsidiary.

 

Section 9.16.                           Waivers of Default .  Waiver by any Party of any default by the other Party of any provision of this Agreement shall not be deemed a waiver by the waiving Party of any subsequent or other default, nor shall it prejudice the rights of the waiving Party.

 

Section 9.17.                           Notices .  All Notices under this Agreement shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by overnight courier service, by facsimile with receipt confirmed (followed by delivery of an original via overnight courier service) or by registered or certified mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses, with a copy (which shall not constitute Notice) to the applicable Abbott Subsidiary or applicable AbbVie Subsidiary at the respective addresses set forth in the applicable Joinder Agreement (or at such other address for a Party as shall be specified in a Notice):

 

If to Abbott:

 

Abbott Laboratories
100 Abbott Park Road
Abbott Park, Illinois 60064-6020
Attn: Divisional Vice President, Abbott Transition Organization

Facsimile: (847) 938-5313

 

22



 

If to AbbVie:

 

AbbVie Inc.
1 North Waukegan Road
North Chicago, Illinois 60064
Attn: Vice President, Strategic Initiative

Facsimile: (847) 937-4330

 

Abbott and AbbVie may, by Notice to such other Party, change the address to which such Notices are to be given.

 

Section 9.18.                           Counterparts .  This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement.

 

Section 9.19.                           Entire Agreement .  This Agreement, the Joinder Agreements, and the exhibits and schedules hereto and thereto contain the entire agreement between the Parties with respect to the subject matter hereof, supersede all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter and there are no agreements or understandings between the Parties other than those set forth or referred to herein or therein.

 

Section 9.20.                           Corporate Power .  Abbott represents on behalf of itself and, to the extent applicable, each Abbott Subsidiary, and AbbVie represents on behalf of itself and, to the extent applicable, each AbbVie Subsidiary, as follows:

 

(a)                                  each such Person has the requisite corporate or other power and authority and has taken all corporate or other action necessary in order to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby; and

 

(b)                                  this Agreement has been duly executed and delivered by it and constitutes a valid and binding agreement of it enforceable in accordance with the terms hereof.

 

Section 9.21.                           Signatures and Delivery .  Each of Abbott and AbbVie acknowledges that it may execute this Agreement by manual, stamp or mechanical signature, and that delivery of an executed counterpart of a signature page to this Agreement (whether executed by manual, stamp or mechanical signature) by facsimile or by email in portable document format (PDF) shall be effective as delivery of such executed counterpart of this Agreement.  Each of Abbott and AbbVie expressly adopts and confirms a stamp or mechanical signature (regardless of whether delivered in person, by mail, by courier, by facsimile or by email in portable document format (PDF)) made in its respective name as if it were a manual signature delivered in person, agrees that it shall not assert that any such signature or delivery is not adequate to bind it to the same extent as if it were signed manually and delivered in person and agrees that, at the reasonable request of the other Party at any time, it shall as promptly as reasonably practicable cause this Agreement to be manually executed (any such execution to be as of the date of the initial date hereof) and delivered in person, by mail or by courier.

 

Section 9.22.                           Severability .  In the event that any one or more of the terms or provisions of this Agreement or the application thereof to any Person or circumstance is determined by a

 

23



 

court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement, or the application of such term or provision to Persons or circumstances or in jurisdictions other than those as to which it has been determined to be invalid, illegal or unenforceable, and Abbott and AbbVie shall use their commercially reasonable efforts to substitute one or more valid, legal and enforceable terms or provisions into this Agreement which, insofar as practicable, implement the purposes and intent of the Parties.  Any term or provision of this Agreement held invalid or unenforceable only in part, degree or within certain jurisdictions shall remain in full force and effect to the extent not held invalid or unenforceable to the extent consistent with the intent of the Parties as reflected by this Agreement.  To the extent permitted by applicable Law, each Party waives any term or provision of Law which renders any term or provision of this Agreement to be invalid, illegal or unenforceable in any respect.

 

Section 9.23.                           Attorney-in-Fact .  Each Abbott Subsidiary that executes a Joinder Agreement designates and appoints Abbott as such Party’s agent and attorney-in-fact with full power and authority to act for and on behalf of such Party in the absolute discretion of Abbott, and each AbbVie Subsidiary that executes a Joinder Agreement designates and appoints AbbVie as such Party’s agent and attorney-in-fact with full power and authority to act for and on behalf of such Party in the absolute discretion of AbbVie, in each case with respect to all matters relating to this Agreement, including execution and delivery of any amendment, supplement, modification or termination of this Agreement and any waiver of any claim or right arising out of this Agreement, agreeing on the Charges from time to time and any adjustments thereto, and, in general, to do all things and to perform all acts, including executing and delivering all agreements, certificates, receipts, instructions, and other instruments contemplated by or deemed advisable to effectuate the provisions of this Section 9.23 .  In addition, the Parties agree that:

 

(a)                                  This appointment and grant of power and authority is coupled with an interest and is in consideration of the mutual covenants made in this Agreement and is irrevocable and will not be terminated by any act of any Abbott Subsidiary or AbbVie Subsidiary that is a Party or by operation of Law or by the occurrence of any other event.  Each Abbott Subsidiary that is a Party hereby consents to the taking of any and all actions and the making of all decisions required or permitted to be taken or made by Abbott pursuant to this Section 9.23 , and each AbbVie Subsidiary that is a Party hereby consents to the taking of any and all actions and the making of all decisions required or permitted to be taken or made by AbbVie pursuant to this Section 9.23 .  Each Abbott Subsidiary that is a Party agrees that Abbott shall have no obligation or Liability to any Person for any action taken or omitted by Abbott in good faith, and each AbbVie Subsidiary that is a Party agrees that AbbVie shall have no obligation or Liability to any Person for any action taken or omitted by AbbVie in good faith; and

 

(b)                                  Abbott shall be entitled to rely upon any document or other paper delivered by AbbVie as being authorized by each AbbVie Subsidiary that is a Party, and AbbVie shall be entitled to rely upon any document or other paper delivered by Abbott as being authorized by each Abbott Subsidiary that is a Party.

 

Section 9.24.                           Further Assurances .  Each Party hereto shall take, or cause to be taken, any and all reasonable actions, including the execution, acknowledgment, filing and delivery of

 

24



 

any and all documents and instruments that any other Party hereto may reasonably request in order to effect the intent and purpose of this Agreement and the transactions contemplated hereby.

 

Section 9.25.                           Public Announcements .  From and after the Effective Time, Abbott and AbbVie shall consult with each other before issuing, and give each other the opportunity to review and comment upon, that portion of any press release or other public statements that relates to the transactions contemplated by this Agreement, and shall not issue any such press release or make any such public statement prior to such consultation, 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.  No other Provider or Recipient shall issue any press release or other public statement with respect to the transactions contemplated by this Agreement without the prior written consent of Abbott and AbbVie.

 

Section 9.26.                           Mutual Drafting .  This Agreement shall be deemed to be the joint work product of the Parties and any rule of construction that a document shall be interpreted or construed against a drafter of such document shall not be applicable.

 

* * * * *

 

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives.

 

 

ABBOTT LABORATORIES

 

ABBVIE INC.

 

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Thomas C. Freyman

 

By:

/s/ Richard A. Gonzalez

 

Name:

Thomas C. Freyman

 

 

Name:

Richard A. Gonzalez

 

Title:

Executive Vice President, Finance and Chief Financial Officer

 

 

Title:

Chairman of the Board and Chief Executive Officer

 

[Signature Page to Ex-U.S. Transition Services Agreement]

 



 

Exhibit A-1 — Ex-US TSA Service

 

TSA Title:

 

Other Manufacturing Costs

Description of TSA Services:

 

Provide other manufacturing services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: labeling, stickering, inventory re-work and similar ancillary activities, as historically provided within or among Abbott Divisions. Services do not include core product manufacturing.

 

A-1



 

Exhibit A-2 — Ex-US TSA Service

 

TSA Title:

 

Quality Assurance

Description of TSA Services:

 

Provide quality assurance services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: quality management, validation, complaints and product actions, and documentation & change control, as historically provided within or among Abbott Divisions.

 

A-2



 

Exhibit A-3 — Ex-US TSA Service

 

TSA Title:

 

Distribution — Order Entry

Description of TSA Services:

 

Provide distribution — order entry services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: customer order-taking, administration & review of customer orders, issue resolution and related functions, as historically provided within or among Abbott Divisions.

 

A-3



 

Exhibit A-4 — Ex-US TSA Service

 

TSA Title:

 

Distribution — Warehousing

Description of TSA Services:

 

Provide distribution — warehousing services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: receipt, storage, order picking and dispatch of products and related services, as historically provided within or among Abbott Divisions.

 

A-4



 

Exhibit A-5 — Ex-US TSA Service

 

TSA Title:

 

Other Charges to COGS

Description of TSA Services:

 

Provide other charges to COGS services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: ancillary distribution or logistics support services historically provided within or among Abbott Divisions and not included as part of the order entry or warehouse / logistics service categories.

 

A-5



 

Exhibit A-6 — Ex-US TSA Service

 

TSA Title:

 

Regulatory Affairs

Description of TSA Services:

 

Provide regulatory affairs services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: promotional review, clinical study support, preparation & review of regulatory documentation, interface with key regulatory agencies and resolution of regulatory issues, as historically provided within or among Abbott Divisions.

 

A-6



 

Exhibit A-7 — Ex-US TSA Service

 

TSA Title:

 

Medical Affairs

Description of TSA Services:

 

Provide medical affairs services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: safety data analysis and collection for marketed and investigational products, review of promotional literature and interaction with physicians who may require particular information that cannot be provided by the commercial team, as historically provided within or among Abbott Divisions.

 

A-7



 

Exhibit A-8 — Ex-US TSA Service

 

TSA Title:

 

Pharmacovigilance

Description of TSA Services:

 

Provide medical affairs services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: adverse event data collection reporting and analysis and support of active surveillance and observational study activities, as historically provided within or among Abbott Divisions.

 

A-8



 

Exhibit A-9 — Ex-US TSA Service

 

TSA Title:

 

Development

Description of TSA Services:

 

Provide development services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: management of clinical trials, operations management for the planning, execution and reporting of clinical development, and support to enable commercialization of drug development projects, as historically provided within or among Abbott Divisions.

 

A-9


 

Exhibit A-10 — Ex-US TSA Service

 

TSA Title:

 

Other R&D / Medical

Description of TSA Services:

 

Provide other R&D/medical services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: ancillary R&D/medical support services as historically provided within or among Abbott Divisions and not included as part of the regulatory affairs, medical affairs, pharmacovigilance or development service categories.

 

A-10



 

Exhibit A-11 — Ex-US TSA Service

 

TSA Title:

 

Advertising / Marketing

Description of TSA Services:

 

Provide advertising / marketing services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: ancillary advertising / marketing support services, as historically provided within or among Abbott Divisions.

 

A-11



 

Exhibit A-12 — Ex-US TSA Service

 

TSA Title:

 

Sales Force Support

Description of TSA Services:

 

Provide sales force support services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: ancillary sales force support services, as historically provided within or among Abbott Divisions.

 

A-12



 

Exhibit A-13 — Ex-US TSA Service

 

TSA Title:

 

Accounting, Reporting & Financial Services

Description of TSA Services:

 

Provide accounting, reporting and financial services required to support the business of the Service Recipient. Services will be provided in accordance with U.S. Generally Accepted Accounting Principles (reported monthly), local statutory requirements (reported annually or as frequently as required by this jurisdiction), and current Abbott Financial policies and procedures. Any financial calculations will be done using established Abbott methods.

 

Services will be provided using Abbott’s existing systems and processes and may include, but are not limited to: general accounting & reporting, accounts receivable, inventory accounting, fixed asset accounting, accounts payable, travel expense processing and reporting, payroll, treasury and similar services, as historically provided within or among Abbott Divisions.

 

A-13



 

Exhibit A-14 — Ex-US TSA Service

 

TSA Title:

 

Financial Planning & Analysis

Description of TSA Services:

 

Provide financial planning & analysis services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: data aggregation, analysis and reporting services, as historically provided within or among Abbott Divisions.

 

A-14



 

Exhibit A-15 — Ex-US TSA Service

 

TSA Title:

 

Information Technology

Description of TSA Services:

 

Provide information technology services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: application support, infrastructure support, desktop support and other IT support services.  IT systems supported may include, but are not limited to: enterprise systems (email, Sharepoint, etc.), transaction systems (BPCS, SAP, etc.) and ancillary support systems (Data analytics, CRM solutions, etc.), as historically provided within or among Abbott Divisions.

 

A-15



 

Exhibit A-16 — Ex-US TSA Service

 

TSA Title:

 

Office Space, Facilities & Related

Description of TSA Services:

 

Provide office space, facilities & related services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: reception, security, mail, utilities and similar services, as historically provided within or among Abbott Divisions. Services do not include lease or sublease of facilities where those services are addressed in a separate lease or sublease agreement.

 

A-16



 

Exhibit A-17 — Ex-US TSA Service

 

TSA Title:

 

Other General Administration

Description of TSA Services:

 

Provide other general administration services required to support the business of the Service Recipient.

 

Services may include, but are not limited to: ancillary general administration support services historically provided within or among Abbott Divisions and not included as part of the accounting reporting & financials services, financial planning & analysis, or information technology service categories.

 

A-17



 

Exhibit B

 

Omitted Services/Additional Services Template

 

TSA Title:

 

 

Description of TSA Services:

 

 

 

B-1


 

Exhibit C

 

Joinder Agreement

 

C-1


 

THIS JOINDER AGREEMENT (“ Joinder Agreement ”) is executed pursuant to Section 2.09 of the Ex-U.S. Transition Services Agreement dated as of December 31, 2012 (the “ Ex-U.S. TSA ”), and is dated as of [ · ], 2012, by and between [name of Abbott Subsidiary] , a [entity type] organized under the laws of [Jurisdiction] (“ Abbott Subsidiary ”) and [name of AbbVie Subsidiary] , a [entity type] organized under the laws of [Jurisdiction] (“ AbbVie Subsidiary ”), as a Provider or Recipient, as applicable, as indicated on Schedule 1 hereto.  Terms used herein and not otherwise defined herein shall have the meanings attributed to them in the Ex-U.S. TSA.

 

R E C I T A L S :

 

WHEREAS, the board of directors of Abbott Laboratories, an Illinois corporation (“ Abbott ”), has determined that it is appropriate and advisable to separate Abbott’s research-based pharmaceuticals business from its other businesses;

 

WHEREAS, in order to effectuate the foregoing, Abbott and AbbVie Inc., a Delaware corporation (“ AbbVie ”), have entered into a Separation and Distribution Agreement, dated as of November 28, 2012 (the “ Separation and Distribution Agreement ”), which provides for, among other things, the contribution from Abbott to AbbVie of certain assets, the assumption by AbbVie of certain Liabilities (as defined in the Separation and Distribution Agreement) from Abbott, the distribution by Abbott of AbbVie common stock to Abbott shareholders, and the execution and delivery of certain agreements in order to facilitate and provide for the foregoing, in each case subject to the terms and conditions set forth therein;

 

WHEREAS, in order to facilitate and provide for an orderly transition under the Separation and Distribution Agreement, Abbott and AbbVie have entered into the Ex-U.S. TSA, which sets forth the terms and conditions pursuant to which each Provider shall provide to the applicable Recipient the Services described in the Ex-U.S. TSA for a transitional period; and

 

WHEREAS, each of Abbott Subsidiary and AbbVie Subsidiary desire to execute this Joinder Agreement to be bound by the terms of the Ex-U.S. TSA.

 

NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this Joinder Agreement and the Ex-U.S. TSA, Abbott Subsidiary and AbbVie Subsidiary hereby agree as follows:

 

1.                                       Agreement to be Bound .  Each of Abbott Subsidiary and AbbVie Subsidiary agree that, with effect from the Commencement Date set forth in Schedule 1 hereto and pursuant to Section 2.09 of the Ex-U.S. TSA, it shall become a party to the Ex-U.S. TSA as a Provider and a Recipient, respectively, and shall be fully bound by and subject to all of the covenants, terms and conditions of the Ex-U.S. TSA with the same force and effect as if it were an original party thereto.  Each of Abbott Subsidiary and AbbVie Subsidiary acknowledges that it has received a copy of the Ex-U.S. TSA.

 



 

2.                                       Corporate Power .  Each party to this Joinder Agreement represents as follows:

 

(a)                                  it has the requisite corporate or other power and authority and has taken all corporate or other action necessary in order to execute, deliver and perform this Joinder Agreement and the Ex-U.S. TSA and to consummate the transactions contemplated hereby and thereby; and

 

(b)                                  this Joinder Agreement has been duly executed and delivered by it and, together with the Ex-U.S. TSA, constitutes a valid and binding agreement of it enforceable in accordance with the terms hereof and thereof.

 

3.                                       Counterparts .  This Joinder Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement.

 

4.                                       Signature and Delivery .  Each of Abbott Subsidiary and AbbVie Subsidiary acknowledges that it may execute this Joinder Agreement by manual, stamp or mechanical signature, and that delivery of an executed counterpart of a signature page to this Joinder Agreement (whether executed by manual, stamp or mechanical signature) by facsimile or by email in portable document format (PDF) shall be effective as delivery of such executed counterpart of this Joinder Agreement.  Each of Abbott Subsidiary and AbbVie Subsidiary expressly adopts and confirms a stamp or mechanical signature (regardless of whether delivered in person, by mail, by courier, by facsimile or by email in portable document format (PDF)) made in its respective name as if it were a manual signature delivered in person, agrees that it shall not assert that any such signature or delivery is not adequate to bind it to the same extent as if it were signed manually and delivered in person and agrees that, at the reasonable request of the other party to this Joinder Agreement at any time, it shall as promptly as reasonably practicable cause this Joinder Agreement to be manually executed (any such execution to be as of the date of the initial date hereof) and delivered in person, by mail or by courier.

 

5.                                       Notices .  All Notices under this Joinder Agreement and the Ex-US TSA shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by overnight courier service, by facsimile with receipt confirmed (followed by delivery of an original via overnight courier service) or by registered or certified mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a Notice):

 

If to Abbott Subsidiary:

 

Abbott Laboratories
100 Abbott Park Road
Abbott Park, Illinois 60064-6020
Attn: Divisional Vice President, Abbott Transition Organization

Facsimile: (847) 938-5313

 

2



 

with a copy (which shall not constitute Notice) to:

 

[Name of Abbott Subsidiary]

[Address]

Attn:  Financial Director

 

If to AbbVie Subsidiary:

 

AbbVie Inc.
1 North Waukegan Road
North Chicago, Illinois 60064
Attn: Vice President, Strategic Initiative

Facsimile: (847) 937-4330

 

with a copy (which shall not constitute Notice) to:

 

[Name of AbbVie Subsidiary]

[Address]

Attn:  Financial Director

 

Abbott Subsidiary and AbbVie Subsidiary may, by Notice to the other party to this Joinder Agreement, change the address to which their respective copy of any such Notice is to be given.

 

6.                                       Headings .  The Section headings contained in this Joinder Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Joinder Agreement.

 

7.                                       Governing Law . This Joinder Agreement shall be governed by and construed and interpreted in accordance with the Laws of the State of Delaware, irrespective of the choice of Laws principles of the State of Delaware, as to all matters, including matters of validity, construction, effect, enforceability, performance and remedies.

 

8.                                       Amendment .  No provisions of this Joinder Agreement shall be deemed amended, supplemented or modified unless (a) Abbott and AbbVie have agreed in writing to such amendment, supplement or modification; and (b) such amendment, supplement or modification is in writing and signed by an authorized representative of each of Abbott Subsidiary and AbbVie Subsidiary; provided , however , that the prior written agreement of Abbott and AbbVie shall not be required if the amendment, supplement or modification relates solely to the amendment, supplement or modification to Schedule 1 hereto as contemplated by the Ex-U.S. TSA.  Promptly following any amendment to Schedule 1 hereto, Abbott Subsidiary and AbbVie Subsidiary shall deliver a copy of such amendment to Abbott and AbbVie.

 

9.                                       Relationship to Ex-U.S. TSA .  This Joinder Agreement shall be deemed to be part of, and a modification to, the Ex-U.S. TSA and shall be governed by all the terms and provisions thereof, which terms are incorporated herein by reference, are ratified and confirmed and shall continue in full force and effect as a valid and binding agreement of Abbott Subsidiary and AbbVie Subsidiary enforceable against each of Abbott Subsidiary and AbbVie Subsidiary.

 

* * * * *

 

3



 

IN WITNESS WHEREOF, Abbott Subsidiary and AbbVie Subsidiary have caused this Joinder Agreement to be executed by their duly authorized representatives.

 

 

ABBOTT [               ]

 

ABBVIE [                   ]

 

 

 

 

 

 

By:

 

 

 

By:

 

 

 

Name:

Thomas C. Freyman

 

 

Name:

William J. Chase

 

Its:

Authorized Representative

 

 

Its:

Authorized Representative

 

[Signature Page to Joinder Agreement to Ex-U.S. Transition Services Agreement]

 



 

Schedule 1

Services — Overview

 

Provider: [Abbott Subsidiary]

Recipient: [AbbVie Subsidiary]

 

Initial Services

 

Commencement Date

 

Early Termination
Date

 

Date of Expiration of
Service Extension
Period

Other Mg. Costs

 

 

 

 

 

 

Quality Assurance

 

 

 

 

 

 

Distribution — Order Entry

 

 

 

 

 

 

Distribution — Warehousing/Log

 

 

 

 

 

 

Other Charges to COGS

 

 

 

 

 

 

Regulatory Affairs

 

 

 

 

 

 

Medical Affairs

 

 

 

 

 

 

Pharmacovigilance

 

 

 

 

 

 

Development

 

 

 

 

 

 

Other R&D / Medical

 

 

 

 

 

 

Advertising / Marketing

 

 

 

 

 

 

Sales Force Support

 

 

 

 

 

 

Acctg, Reporting & Financial Services

 

 

 

 

 

 

Financial Planning & Analysis

 

 

 

 

 

 

Information Technology

 

 

 

 

 

 

Office Space, Facilities & Related

 

 

 

 

 

 

Other General Administrative

 

 

 

 

 

 

 

Schedule 1 - i



 

Provider: [AbbVie Subsidiary]

Recipient: [Abbott Subsidiary]

 

Initial Services

 

Commencement Date

 

Early Termination
Date

 

Date of Expiration of
Service Extension
Period

Other Mg. Costs

 

 

 

 

 

 

Quality Assurance

 

 

 

 

 

 

Distribution — Order Entry

 

 

 

 

 

 

Distribution — Warehousing/Log

 

 

 

 

 

 

Other Charges to COGS

 

 

 

 

 

 

Regulatory Affairs

 

 

 

 

 

 

Medical Affairs

 

 

 

 

 

 

Pharmacovigilance

 

 

 

 

 

 

Development

 

 

 

 

 

 

Other R&D / Medical

 

 

 

 

 

 

Advertising / Marketing

 

 

 

 

 

 

Sales Force Support

 

 

 

 

 

 

Acctg, Reporting & Financial Services

 

 

 

 

 

 

Financial Planning & Analysis

 

 

 

 

 

 

Information Technology

 

 

 

 

 

 

Office Space, Facilities & Related

 

 

 

 

 

 

Other General Administrative