Exhibit 10.5


 


INFORMATION TECHNOLOGY AGREEMENT


 


THIS INFORMATION TECHNOLOGY AGREEMENT, dated as of April 29, 2004
and effective as of May 1, 2004 (the “Effective Date”), is by and between
ABBOTT LABORATORIES, an Illinois corporation (“Abbott”), and HOSPIRA, INC., a
Delaware corporation (“Hospira”).


 


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 core hospital products business from its other businesses;


 


WHEREAS, in order to
effectuate the foregoing, Abbott and Hospira have entered into a Separation and
Distribution Agreement dated as of April 12, 2004 (the “Separation and
Distribution Agreement”), which provides, among other things, subject to the
terms and conditions set forth therein, for the contribution to Hospira of
certain assets, the assumption by Hospira of certain liabilities and the
distribution of Hospira common stock to Abbott shareholders, and for the
execution and delivery of certain other agreements in order to facilitate and
provide for the foregoing;


 


WHEREAS, in order to
ensure an orderly transition under the Separation and Distribution Agreement it
will be necessary for each of the Parties (as defined herein) to cooperate to
provide for the separation of various information technology systems and
services that are currently shared between the Parties, are provided by Abbott
to Hospira or are planned to be implemented by both Parties; and


 


WHEREAS, the Parties
intend that all separation activities to be completed under this Agreement
shall be completed by the end of the two-year term of this Agreement.


 


NOW, THEREFORE, in
consideration of the mutual agreements, provisions and covenants contained in
this Agreement, and subject to and on the terms and conditions herein set
forth, the Parties hereby agree as follows:


 


Section 1.                                            DEFINITIONS.


 


For purposes of this Agreement, the following terms shall have the
following meanings:


 


“Abbott” has the meaning set forth in the Preamble.


 


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


 


“Abbott Business” means all businesses and operations (whether or not
such businesses or operations are or have been terminated, divested or
discontinued) conducted prior to the Effective Date by Abbott, the Abbott
Subsidiaries, Hospira and the Hospira Subsidiaries, in each case that are not
included in the Hospira Business.


 

















 


“Abbott Indemnitee” has the meaning set forth in Section 7(c)(ii).


 


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


 


“Abbott Owned Materials” has the meaning set forth in Section 3(a)(i).


 


“ADR” has the meaning set forth in Section 7(k).


 


“Agreement” means this Information Technology Agreement and each of the
Schedules hereto.


 


“Ancillary Agreements” has the meaning set forth in the Separation and
Distribution Agreement.


 


“Business Entity” means any corporation, general or limited
partnership, trust, joint venture, unincorporated organization, limited
liability entity or other entity.


 


“Change of Control Event” has the meaning set forth in Section 7(o).


 


“Charges” has the meaning set forth in Section 2(d)(i).


 


“Consents” means any consents, waivers or approvals from, or
notification requirements to, any Third Parties.


 


“Derivative Work” means a work based on one or more preexisting works,
including a condensation, transformation, translation, modification, expansion
or adaptation that, if prepared without authorization of the owner of the
copyright of such preexisting work, would constitute a copyright infringement
under applicable law, but excluding the preexisting work.


 


“Developed Materials”  means
any Materials (including software), or any modifications, enhancements or
Derivative Works thereof, which (i) are jointly developed by or on behalf of
the Parties or any of their Subsidiaries in connection with or as part of the
Services and (ii) are not otherwise Abbott Owned Materials or Hospira Owned
Materials.


 


 “Effective Date” has the
meaning set forth in the Preamble.


 


“Expiration Date” has the meaning set forth in the Section 5(a).


 


“Governmental Authority” means any supranational, international,
national, federal, state, or local court, government, department, commission,
board, bureau, agency, official or other regulatory, administrative or
governmental authority, including the NYSE and any similar self-regulatory body
under applicable securities laws or regulations.


 


“Hospira” has the meaning set forth in the Preamble.


 


“Hospira Business” means the business and operations which are separated
from the Abbott Business pursuant to the Separation and Distribution Agreement.


 


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“Hospira Indemnitee” has the meaning set forth in Section 7(c)(i).


 


“Hospira IT Agreement” means any IT Agreement which is held in the name
of Abbott or any Abbott Subsidiary, and which is used exclusively in connection
with, or relates solely to, the Hospira Business.


 


“Hospira Owned Materials” has the meaning set forth in Section 3(a)(ii).


 


“Indemnitee” means a Hospira Indemnitee or an Abbott Indemnitee.


 


“Information” means information, whether or not patentable or
copyrightable, in written, oral, electronic or other tangible or intangible
forms, including studies, reports, records, books, contracts, instruments,
surveys, discoveries, ideas, concepts, know-how, techniques, designs,
specifications, drawings, blueprints, diagrams, models, prototypes, samples,
flow charts, data, computer data, disks, diskettes, tapes, computer programs or
other software, marketing plans, customer names, communications by or to
attorneys (including attorney-client privileged communications), memos and
other materials prepared by attorneys or under their direction (including
attorney work product), and other technical, financial, employee or business
information or data.


 


“Intellectual Property License Agreements” means the Intellectual
Property License Agreements entered into prior to the Effective Date by and
between the Parties pursuant to the Separation and Distribution Agreement.


 


“IT Agreement” means any software license or Third Party service
agreement that is: (a) used by either Party or its Subsidiaries (i) to provide
Services or Materials under this Agreement; or (ii) used to provide any
information technology services under the TSA; or (b) required in connection
with the operation of the information technology systems and services of the
Hospira Business.


 


“Materials” shall mean all computing, networking, telecommunications
and other equipment (firmware and hardware); all software programs and
programming (and all modifications, replacements, upgrades, enhancements,
documentation, materials and media related thereto), including all machine
readable and object code, and all source code, utilities, tools and validation
packages; and all other literary works, other works of authorship,
specifications, design documents and analyses, processes, methodologies,
programs, program listings, programming tools, user manuals, documentation,
reports, drawings, databases, machine readable text and files, data and similar
items.


 


“Month End Rate” means for any currency other than United States
dollars, the official average monthly rates used by Abbott for conversion of
its monthly financial statements, known as the average B.2.0 rate.  The month end B.2.0 rate is determined by
taking the numbers from the 9:00 a.m. (Central Time) Reuters screen at the
second to last Abbott Park, Illinois business day of each calendar month (with
the exception of November, when the rate is taken on the last such business
day).  For the Euro, British Pound,
Australian Dollar and New Zealand Dollar, the bid rate is used.  For all other currencies, the ask price is
used.  An average monthly rate is
determined by taking the simple average of the prior month book rate and the
current month book rate.  If the
exchange rates available locally are not reflected on the Reuters screen,
Abbott may


 


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choose to approve a deviation allowing the country to report rates
directly; provided such deviations are signed and in place in accordance with
the B.2.0 policy.


 


“NYSE” means The New York Stock Exchange, Inc.


 


“Other IT Agreement” means any IT Agreement that is not a Hospira IT
Agreement or a Shared IT Agreement.


 


“Parties” means the parties to this Agreement.  “Party” means each Party to this Agreement.


 


“Person” means any (i) individual; (ii) Business Entity; or (iii)
Governmental Authority.


 


“Prime Rate” means the rate which Citibank N.A. (or its successor or
another major money center commercial bank agreed to by the Parties) announces
as its prime lending rate, as in effect from time to time.


 


“Project Executive” has the meaning set forth in Section 7(e).


 


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


 


“Separation Project” means each individual project that is described in
the Separation Projects Plan, and that is or will be described in greater
detail in one or more Work Schedules.


 


“Separation Projects Plan” means the high level description of
information technology separation projects and the associated timeline for
completing those projects that the Parties will undertake pursuant to this
Agreement to accomplish the separation of the information technology systems
and services, as such initial list is set forth in Schedule A, and
as the same may be amended from time to time.


 


“Services” has the meaning set forth in Section 2(a).


 


“Shared IT Agreement” means any IT Agreement that is held in the name
of Abbott or any Abbott Subsidiary, which is used in connection with the Abbott
Business and the Hospira Business.  A
list of Shared IT Agreements identified by the Parties to date is set forth in Schedule C.


 


“Subsidiary” of any Party means another Business Entity that is
directly or indirectly controlled by such Party.  As used herein, “control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Business Entity, whether through ownership of voting
securities or other interests, by contract or otherwise.  For the avoidance of doubt, TAP
Pharmaceutical Products Inc., TAP Finance Inc. and TAP Pharmaceuticals Inc. are
not Subsidiaries of Abbott as that term is used in this Agreement.


 


“Taxes” means all forms of taxation or duties imposed, or required to
be collected or withheld, together with any related interest, penalties or
other additional amounts.


 


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“Third Party” means any Person other than Abbott, any Abbott Subsidiary,
Hospira and any Hospira Subsidiary.


 


“Third Party Claim” has the meaning set forth in Section 7(c)(vii).


 


“TSA” has the meaning set forth in Section 2(b).


 


“U.S.” or “United States” means the United States of America, including
each of the 50 states thereof and the District of Columbia, but excluding
Puerto Rico and all other territories and possessions.


 


“Work Schedule” means each document in the form set forth in Schedule B
that is executed by the Parties pursuant to this Agreement, including each
applicable “RFSS”, “Contract” or similar document referenced on such Work
Schedule, that details the work effort and further describes the Services to be
performed by Abbott and/or Hospira in connection with a particular Separation
Project(s).


 


Section 2.                                            SERVICES.


 


(a)                                  SERVICES.  Each of the Parties agrees to provide, or
cause its respective Subsidiaries to provide, the applicable services
(“Services”) set forth in any Work Schedule to Abbott or Hospira,
respectively, and/or any of their Subsidiaries as designated in the Work
Schedule.  Each of the Parties further
agrees to use good faith in negotiating any Work Schedules which are not
completed as of the Effective Date. 
This Agreement is a master agreement. 
Each of the Parties, respectively, shall be responsible and liable for
all the obligations under this Agreement of each of their respective
Subsidiaries that performs Services hereunder.


 


(b)                                 TRANSITION
SERVICES AGREEMENTS AND CONFLICTS.  The
Parties have entered into that certain U.S. Transition Services Agreement and
that certain Ex-U.S. Transition Services Agreement (collectively, the “TSA”)
dated as of the same date as this Agreement. 
The TSA is intended to cover all services described therein that the
Parties will require to continue to operate their respective businesses after
the Effective Date, including, without limitation, information technology
services.  This Agreement is intended to
cover all additional work effort that must be performed, and Materials that
must be developed or procured, to separate the information technology systems
and services that (i) are currently shared between the Parties and/or their
respective Subsidiaries, (ii) are currently provided by one of the Parties or
its Subsidiary to the other Party or one or more of its Subsidiaries under the
TSA, or (iii) are to be implemented by mutual agreement of the Parties.  If there is a conflict regarding Services
provided under this Agreement, and similar services described in the TSA, this
Agreement shall govern and control over such Services.  If there is a conflict between the
provisions of this Agreement and those of the Separation and Distribution
Agreement, this Agreement shall govern and control with respect to the subject
matter addressed in this Agreement.  In
addition, if there is a conflict between this Agreement and any Intellectual
Property License Agreement, the Intellectual Property License Agreement shall
govern and control solely with respect to the subject matter of such
Intellectual Property License Agreement.


 


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(c)                                  PERFORMANCE
OF SERVICES.


 


(i)                                     Each
of the Parties shall, and shall cause its Subsidiaries to, perform its duties
and responsibilities hereunder in good faith and in a timely manner.  Neither Abbott nor Hospira, nor any of their
respective Subsidiaries, shall be liable or held accountable, in damages or
otherwise, for any error of judgment or any mistake of fact or law or for
anything that Abbott or Hospira, or any of their respective Subsidiaries, does
or refrains from doing in good faith, except in the case of their gross
negligence or willful misconduct.


 


(ii)                                  Nothing
in this Agreement shall require either Party or its Subsidiaries to perform or
cause to be performed any Service in a manner that would constitute a violation
of applicable law.


 


(iii)                               (A)
Neither Party nor any of its Subsidiaries will 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 other Party under this Agreement, and its
Subsidiaries, and (B) EXCEPT AS EXPRESSLY PROVIDED IN AN APPLICABLE WORK
SCHEDULE, EACH PARTY ACKNOWLEDGES AND AGREES THAT ALL SERVICES ARE PROVIDED ON
AN “AS-IS” BASIS, AND THAT EACH PARTY MAKES NO WARRANTIES, EXPRESS OR IMPLIED,
WITH RESPECT TO THE SERVICES, AND HEREBY DISCLAIMS ANY REPRESENTATION OR
WARRANTY OF MERCHANTABILITY, FITNESS FOR ANY PARTICULAR PURPOSE,
NON-INFRINGEMENT OR ANY OTHER WARRANTY WHATSOEVER.


 


(d)                                 CHARGES
FOR SERVICES AND PERFORMANCE OF SEPARATION PROJECTS.


 


(i)                                     Estimated
Charges.  Each Work Schedule shall
specify the Party that shall bear the costs and expenses of the Services,
including the acquisition, procurement, leasing or licensing of Materials, and
all other costs and expenses associated with a Party completing a particular
Separation Project (all such costs and expenses are collectively referred to as
the “Charges”).  The Charges for
completing Separation Projects shall be borne by the Parties according to the
terms set forth in Schedule D; provided, that the Charges shall
exclude any and all amounts for services performed by a Third Party that is not
an agent, supplier, subcontractor or independent contractor of the Party
providing the Services under such Work Schedule.  The Charges set forth in a Work Schedule shall be a good
faith estimate of the charges for the Services covered by that Work Schedule,
and shall neither be binding on the Party providing such estimate nor convert
the Work Schedule into a fixed-price contract.  Any such estimate is for informational purposes only, and the
actual fees payable for any Services may be higher or lower than that estimate,
with such higher amounts, if applicable, to be paid by the Party responsible
for such Charges under the applicable Work Schedule.   The Charges shall be calculated in the local currency of the
Party providing the Services and shall be translated into U.S. Dollars using
the Month End Rate for such currency for the applicable month.   In the event that a Local Closing (as
defined under the applicable Transition Marketing and Distribution Services
Agreement) occurs for any country, but Services are still being provided for
that country under this Agreement, the Parties will negotiate in good faith
appropriate modifications to the Charges for such Services.


 


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(ii)                                  Reporting
Obligations.  The Project Executive
or their designee shall be responsible for overseeing the Separation Projects
and the progress of the Services in light of the estimated Charges.  As described in more detail in each
applicable Work Schedule, each Party shall report to the other Party regarding
the status of each Separation Project in the manner and with the frequency
described in the applicable Work Schedule (including the identification of
any known overages in the estimated Charges and an updated estimate to complete
such Separation Project), and, in any event, no less frequently than monthly
during the term of this Agreement. 
Unless otherwise agreed in writing, the Parties shall provide such
reporting using the form of status report attached hereto as Schedule G.


 


(e)                                  CHANGE
CONTROL PROCEDURES.  During the term of
this Agreement, Abbott and/or Hospira may desire a change in the scope of the
effort, including modifying, updating and/or refining any Work Schedule or
the Separation Projects Plan.  Requests
for all changes shall be made in writing and delivered to the appropriate
Project Executive.  The Project
Executives from both Parties shall review the proposed change and: (i) approve
it; (ii) return it with a request for more detail or information; or (iii)
reject it.  The Project Executives shall
agree on any Charges for such change, including the charges for investigating
such change if applicable.  If the
change is authorized, the Parties’ Project Executives shall so indicate in
writing, which writing shall constitute approval for the change and the
applicable Charges.  The writing shall
also indicate the effect that the change will have on the other terms and
conditions of the applicable Work Schedule(s). 
Except as may otherwise be agreed in writing, the Party requesting a
change shall compensate the other party for investigating and preparing any
proposed addendum or change to a Work Schedule.


 


(f)                                    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 and completion of the Separation Projects.


 


(g)                                 COOPERATION.  In the event that (i) there is
nonperformance of any Service as a result of an event described in Section 7(d),
or (ii) the provision of a Service would violate applicable law, the Parties
agree to work together in good faith to arrange for an alternative means by which
the Separation Project may be accomplished.


 


(h)                                 USE
OF THIRD PARTIES.


 


(i)                                     THIRD
PARTIES USED TO PROVIDE THE SERVICES. 
Either Party may perform its obligations herein through its Subsidiaries
or through agents, suppliers, subcontractors or independent contractors of such
Party, or of its Subsidiaries; provided, that each such agent, supplier,
subcontractor or independent contractor (and the individual employees of such
Persons) used by a Party shall be subject to the reasonable prior approval of
the other Party.  The Parties hereby
approve the use of any of the suppliers listed in Schedule E;
provided, however, that each Party reserves the right to reasonably approve or
reject individual employees of such suppliers. 
In addition, if in connection with the provision of Services or
Materials a Party uses any agent, supplier, subcontractor or independent
contractor who has been fired, dismissed or relieved of its obligations by the
other Party or its Subsidiary due to poor performance or other cause, the other
Party shall be entitled to cause the hiring Party to promptly remove and
replace such agent, supplier subcontractor or independent contractor.


 


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(ii)                                  THIRD
PARTIES USED FOR MATTERS OUTSIDE THE SCOPE OF THE SERVICES.  Each Party shall also have the right to
engage agents, suppliers, subcontractors or independent contractors to provide
services that are outside the scope of the Services, provided that such Third Parties
will not, either individually or in connection with one or more other agents,
suppliers, subcontractors or independent contractors (including the Third
Parties described in Section 2(h)(i)) materially adversely affect
the Services without the other Party’s reasonable consent; and further,
provided that the engaging Party shall be solely responsible for all such
agents, suppliers, subcontractors or independent contractors.


 


(iii)                               TERMS
APPLICABLE TO ALL THIRD PARTIES USED BY A PARTY.  Each Party shall cooperate with and work in good faith with the
agents, suppliers, subcontractors and independent contractors engaged by the
other Party in connection herewith or in connection with related services that
require the cooperation of such Party. 
Such cooperation may include providing reasonable access to the
facilities, systems, equipment and/or software required by the other Party to
provide the Services or such related services, solely to the extent necessary
for such agents, suppliers, subcontractors and independent contractors to
perform the work assigned to them.  The
engaging Party shall cause all such agents, suppliers, subcontractors and
independent contractors to comply with the other Party’s security and
confidentiality requirements. 
Notwithstanding anything in this Agreement to the contrary, a Party
shall not be relieved of its obligations under this Agreement by use of any
Subsidiaries, agents, suppliers, subcontractors or independent contractors.


 


(i)                                     SECURITY
PROCEDURES.  Each Party’s respective
security administration groups shall, subject to the reasonable approval of the
other Party, establish and maintain environmental, safety and facility
procedures, data security procedures and other safeguards against the
destruction, loss, unauthorized access or alteration of systems or Materials of
the other Party which are (i) no less rigorous than those maintained by a Party
for its own information of a similar nature, and (ii) adequate to meet the
requirements of the other Party’s 
security policies and applicable law. 
In the event a Party discovers or is notified of a breach or potential
breach of security relating to systems or Materials of the other Party, such
Party will expeditiously under the circumstances notify the other Party, and
will cooperate in the investigation and remediation of the effects of such
breach or potential breach of security.


 


(j)                                     CONSENTS.


 


(i)                                     Hospira
IT Agreements.  Subject to the
Parties obtaining any required Consents, Abbott or the applicable Abbott
Subsidiary shall assign to Hospira or the applicable Hospira Subsidiary any
Hospira IT Agreement.  The assignment
shall be subject to the terms of the Separation and Distribution Agreement, and
the rights and obligations under such IT Agreement shall be Hospira Assets and
Hospira Liabilities and, if applicable, Delayed Transfer Assets and Delayed
Transfer Liabilities, as such terms are defined in the Separation and
Distribution Agreement.  The costs of
obtaining any required Consent in connection with the assignment of any Hospira
IT Agreement shall be borne solely by Hospira. 
If, despite using their commercially reasonable efforts, the Parties are
unable to obtain a Consent in connection with a Hospira IT Agreement, then,
unless and until such Consent is obtained, the Parties shall use their
commercially reasonable efforts to use mutually acceptable alternative
approaches to provide the Services or to deliver substantially similar benefits
at the sole cost and expense of Hospira.


 


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(ii)                                  Shared
IT Agreements.  Subject to the
Parties obtaining any required Consents, Abbott or the applicable Abbott
Subsidiary shall assign to Hospira or the applicable Hospira Subsidiary that
portion of any Shared IT Agreement that relates to the Hospira Business.  The partial assignment shall be subject to
the terms of the Separation and Distribution Agreement, and the rights and
obligations under the assigned portion of such IT Agreement shall be Hospira
Assets and Hospira Liabilities and, if applicable, Delayed Transfer Assets and
Delayed Transfer Liabilities, as such terms are defined in the Separation and
Distribution Agreement.  If, despite
using their commercially reasonable efforts, the Parties are unable to obtain a
Consent in connection with a Shared IT Agreement, then, unless and until such
Consent is obtained, the Parties shall use their commercially reasonable
efforts to use mutually acceptable alternative approaches to provide the
Services or to deliver substantially similar benefits at the sole cost and
expense of Hospira.  The Parties shall
cooperate in obtaining Consents in connection with Shared IT Agreements in a
manner which is substantially similar to such Parties’ efforts during the two
month period prior to the Effective Date (“Assignment Efforts”).  Notwithstanding the foregoing in this Section 2(j)(ii),
if the partial assignment of a Shared IT Agreement to Hospira or a Hospira
Subsidiary will require a transfer fee to a Third Party (a “Third Party
Payment”), then the Parties will use Assignment Efforts to effect the partial
assignment and make the Third Party Payment; provided that Abbott shall be
responsible for such Third Party Payment only if such partial assignment is
effected prior to July 1, 2004 and Hospira shall be responsible for such
Third Party Payment if such partial assignment is effected after June 30,
2004.  The use of the term “Assignment
Efforts” in the previous sentence shall not be deemed to limit Abbott’s
responsibility for making Third Party Payments from the Effective Time through
June 30, 2004.


 


(iii)                               The
Parties recognize that the ultimate resolution of assignments of Shared IT
Agreements will require the agreement of three (3) parties (i.e., the Third
Party, Abbott and Hospira) regarding the number of licenses to be assigned, and
that, as of the Effective Date, the number of licenses which Abbott has and
which Hospira requires is unknown. 
Accordingly, the Parties agree that the ultimate division of licenses
between them shall be fair and equitable based upon their usage of the
Effective Date.  The Parties agree to
use Assignment Efforts and work in good faith to assign the licenses in a
timely manner as the number of licenses becomes known, or as the license
assignments  become critical path
projects for Hospira.


 


Section 3.                                            OWNERSHIP AND LICENSE RIGHTS IN MATERIALS.


 


(a)                                  OWNED
MATERIALS.


 


(i)                                     Abbott
shall be the sole and exclusive owner of Materials which are used in connection
with the Services and are owned by Abbott, or licensed from Third Parties by
Abbott, or any of its Subsidiaries, including all enhancements and Derivative
Works of such Materials, including United States and foreign intellectual
property rights in such Materials and shall retain all of Abbott’s, its
Subsidiaries’ and Third Party licensors’ rights in such Materials (all such owned,
licensed, developed and provided Materials, “Abbott Owned Materials”). Subject
to the terms of any Consents, Abbott grants to Hospira, its Subsidiaries and
their contractors and agents a non-exclusive, non-transferable, worldwide,
limited right and license to use, execute, reproduce, display, perform, modify
and distribute the Abbott Owned Materials for the sole purpose of providing
and/or receiving the Services during the term of this Agreement;


 


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provided, that this license does not give
Hospira and its Subsidiaries, or their contractors or agents, the right, and
Hospira and its Subsidiaries, and their contractors and agents, are not
authorized, to sublicense such Materials or use them for the benefit of other
customers or for any other purpose without Abbott’s prior written consent.  Abbott may, in its sole discretion and upon
such terms and at such prices as the Parties may agree, grant Hospira a license
to use the Abbott Owned Materials for other purposes and to sublicense such
Materials.


 


(ii)                                  Hospira
shall be the sole and exclusive owner of Materials which are used in connection
with the Services and are owned by Hospira, or licensed from Third Parties by
Hospira, or any of its Subsidiaries, including all enhancements and Derivative
Works of such Materials, including United States and foreign intellectual
property rights in such Materials and shall retain all of Hospira’s, its
Subsidiaries’ and Third Party licensors’ rights in such Materials (all such
owned, licensed, developed and provided Materials, “Hospira Owned
Materials”).  Subject to the terms of
any Consents, Hospira grants to Abbott, its Subsidiaries and their contractors
and agents a non-exclusive, non-transferable, worldwide, limited right and
license to use, execute, reproduce, display, perform, modify and distribute the
Hospira Owned Materials for the sole purpose of providing and/or receiving the
Services during the term of  this
Agreement; provided, that this license does not give Abbott and its
Subsidiaries or their contractors or agents, the right, and Abbott and its
Subsidiaries, and their contractors and agents, are not authorized, to
sublicense such Materials or use them for the benefit of other customers or for
any other purpose without Hospira’s prior written consent.  Hospira may, in its sole discretion and upon
such terms and at such prices as the Parties may agree, grant Abbott a license
to use the Hospira Owned Materials for other purposes and to sublicense such
Materials.


 


(b)                                 DEVELOPED
MATERIALS.


 


(i)                                     Ownership.  The Parties shall jointly own all
intellectual property rights in all Developed Materials.  The Parties will, without limitation, retain
the right to make, have made, use, lease, import, offer for sale, or sell and
practice methods used in the creation or provision of products or services that
incorporate the Developed Materials to the extent that such actions do not
infringe upon the intellectual property rights of  the other Party.  Each
Party shall retain the right to grant non-exclusive licenses to any
intellectual property right in the Developed Materials without any payment or
accounting to the other Party.


 


(ii)                                  Cost
Sharing of Developed Materials. 
Each Party agrees to pay one-half (1/2) the costs associated with
obtaining and perfecting any intellectual property rights in the Developed
Materials.  If, within ninety (90) days
of receiving notice from the other Party of payments made by the other Party
associated with obtaining and perfecting intellectual property rights in the
subject Developed Materials in a particular jurisdiction, a Party subsequently
fails to provide its share of the costs, it will promptly assign, transfer and
convey to the other Party any and all intellectual property rights in the
subject Developed Materials, and such assignment of rights shall be the paying
Party’s sole and exclusive remedy for the assigning Party’s exercise of its
option not to pay one-half (1⁄2) of the costs of obtaining or perfecting any such
rights in the Developed Materials.  The
assigning Party shall deliver to the other Party, upon request therefor, such
documentation and assignments of interest as may be necessary to evidence its
ownership and enforce its interests in the assigned rights.  In any event, both Parties agree, at their
own


 


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expense, to cooperate fully with the other Party in obtaining and
perfecting intellectual property rights in the Developed Materials, or in
assisting in such efforts.


 


(iii)                               Embedded
Materials.  To the extent that
Abbott Owned Materials or Hospira Owned Materials are embedded in any Developed
Materials by the owner of such Materials, the owner of such Materials shall not
be deemed to have assigned its intellectual property rights in such owned
Materials to the other Party, but subject to the terms and restrictions of any
Consent, the owner of such embedded Materials hereby grants to the other Party
and its Subsidiaries a worldwide, perpetual, irrevocable, non-exclusive, fully
paid-up license, with the right to grant sublicenses, to use, execute,
reproduce, display, perform, modify, enhance, distribute and create Derivative
Works of such embedded Materials for the benefit and use of the other Party and
its Subsidiaries for so long as such Materials remain embedded in such
Developed Materials.  Notwithstanding
the foregoing, neither Party shall embed any Abbott Owned Materials or Hospira
Owned Materials into Developed Materials without the express written agreement
of both Parties to do so, as set forth in the applicable Work Schedule.  In addition, should either Party incorporate
into Developed Materials any intellectual property subject to Third Party
patent, copyright or license rights, any ownership or license rights granted
herein with respect to such Materials shall be limited by and subject to any
such patents, copyrights or license rights; provided that, prior to
incorporating any such intellectual property in any Materials, the Party
incorporating such intellectual property in the Materials has disclosed this
fact and obtained the prior written approval of the other Party and has
obtained any Consents.


 


(iv)                              Source
Code and Documentation.  If either
Party requests that the source code for particular Materials be placed in
escrow for the benefit of the requesting Party, then the Parties shall
cooperate in good faith to establish such source code escrow arrangements on
terms and conditions that shall be reasonably acceptable to both Parties.


 


(c)                                  GENERAL
RIGHTS AND OBLIGATIONS REGARDING MATERIALS.


 


(i)                                     Copyright
Legends. 
Each Party agrees to reproduce copyright legends which appear
on any portion of the Materials which may be owned by the other Party or Third
Parties.


 


(ii)                                  No
Implied Licenses.  Except as
expressly specified in this Agreement, nothing in this Agreement shall be
deemed to grant to one Party, by implication, estoppel or otherwise, license
rights, ownership rights or any other intellectual property rights in any
Materials owned by the other Party or any Subsidiary of the other Party.


 


(iii)                               Residuals.  Nothing in this Agreement shall restrict any
employee or representative of a Party from using general ideas, concepts or
know-how relating to the Services or Materials that are retained solely in the
unaided memory of such employee or representative after performing the
obligations of a Party under this Agreement, except to the extent that such use
infringes upon any patent, copyright or other intellectual property right of a
Party or its Subsidiaries; provided, however, that this Section shall not
be deemed to limit either Party’s obligations under this Agreement with respect
to the disclosure or use of confidential Information or Materials of the other
Party.  An individual’s memory is
unaided if the individual


 


11

















 


has not intentionally memorized the confidential Information or subject
Materials for the purpose of retaining and subsequently using or disclosing it.


 


(iv)                              Required
Consents.  Subject to Section 2(j) above, each Party shall, at its own expense, use
commercially reasonable efforts to obtain all Consents necessary in connection
with (i) in the case of Abbott, all Abbott Owned Materials, and (ii) in the
case of Hospira, all Hospira Owned Materials. 
Each of the Parties will reasonably cooperate with the other in
obtaining such Consents.


 


Section 4.                                            BILLING; TAXES.


 


(a)                                  PROCEDURE.  Each Work Schedule shall set forth the
types of, and where possible, the amount of, Charges that each Party shall be
financially responsible for in connection with the Services and the Materials
to be developed, procured or provided pursuant to a Work Schedule.  Where Charges are to be paid to a Third
Party for Services or Materials under a Work Schedule, the Party listed as the
responsible Party under the Work Schedule shall pay such Charges directly
to the Third Party.  Where Charges are
to be paid to the other Party, the Party who is entitled to reimbursement for
Services or other Charges pursuant to a Work Schedule shall issue an
invoice detailing such charges to the other Party.  Amounts payable pursuant to the terms of this Agreement shall be
paid to the invoicing Party on a monthly basis, which amounts shall be due
within thirty (30) days after the date of invoice.  All amounts due and payable hereunder shall be invoiced and paid
in U.S. dollars.


 


(b)                                 LATE
PAYMENTS.  Charges not paid when due
shall bear interest at a rate per annum equal to the Prime Rate plus two
percent (2%).


 


(c)                                  TAXES.  The Party who is primarily responsible for
payment for Charges under a particular Work Schedule shall pay any and all
Taxes incurred in connection with the Services under that Work Schedule,
including all sales, use, value-added and similar Taxes, but excluding Taxes
based on the other Party’s net income. 
Each Party shall be responsible for all sales, service, value-added,
lease, use, personal property, excise, consumption, and other taxes and duties,
including VAT, payable by such Party on any goods or services used or consumed
by such Party in providing Services where the tax is imposed on such Party’s
acquisition or use of such goods or services.


 


(d)                                 NO
SET-OFF.  The obligation to pay Charges
or to make any other required payments under this Agreement shall not be
subject to any right of offset, set-off, deduction or counterclaim, however
arising.


 


Section 5.                                            TERM; TERMINATION OF WORK SCHEDULES; TRANSFER
ASSISTANCE.


 


(a)                                  TERM.  This Agreement will expire two (2) years
after the Effective Date (the “Expiration Date”).  In the event that, despite commercially reasonable efforts by
both Parties, there are uncompleted Work Orders related to quality control
systems and other systems subject to regulatory review at the Expiration Date,
the Party receiving the Services may elect to extend the term of this Agreement
with respect to those Work Orders to the extent necessary to complete those
Work Orders as long as that Party continues to use commercially reasonable


 


12

















 


efforts to complete those Work Orders. 
In no event, however, shall any such extension exceed an additional two
(2) years.  No later than three (3)
months prior to the Expiration Date, the Parties shall meet and confer to
discuss the status of all uncompleted Work Schedules and, where feasible,
develop a plan to complete such Work Schedule on or before the Expiration
Date.


 


(b)                                 TERMINATION
OF WORK SCHEDULES.


 


(i)                                     Termination
for Convenience.  Upon receipt by
the other Party of at least thirty (30) days prior written notice, either Party
may terminate a Work Schedule without the consent of the other Party
solely for the purpose of transferring the control and responsibility for the
Services under such Work Schedule to the terminating Party; provided, that
(A) the terminating Party shall be solely responsible for completing such Work
Schedule during the term of this Agreement, and (B) upon receipt of such
notice, the terminated Party shall be released from all responsibility in
connection with the terminated Work Schedule, except as provided in Section 5(b)(ii).


 


(ii)                                  Transfer
Assistance.  Upon receipt of a
notice to terminate a Work Schedule pursuant to Section 5(b)(i),
each Party shall provide to the other Party such assistance as is reasonably
necessary to permit the orderly transfer of the Services to be performed under
such Work Schedule to the terminating Party, including providing
reasonable access to any facilities, systems, equipment and/or software being
used by the other Party to provide the Services under the terminated Work
Schedule; provided, that the terminating Party shall comply with the other
Party’s security and confidentiality requirements in connection with such
access.


 


Section 6.                                            CONFIDENTIALITY; PROTECTIVE ARRANGEMENTS.


 


(a)                                  CONFIDENTIALITY
OBLIGATIONS.  Subject to Section 6(c),
Abbott, on behalf of itself and each Abbott Subsidiary, and Hospira, on behalf
of itself and each Hospira Subsidiary, agrees to hold, and to cause its
respective directors, officers, employees, agents, accountants, counsel and
other advisors and 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 Date, all
Information and Materials concerning the other (or its business) and the
other’s Subsidiaries (or their respective businesses) that is either in its
possession (including Information and Materials in its possession prior to the
Effective Date) or furnished by the other or the other’s Subsidiaries or their
respective directors, officers, employees, agents, accountants, counsel and
other advisors and representatives at any time pursuant to this Agreement, and
shall not use any such Information or Materials other than for such purposes as
may be expressly permitted hereunder, except, in each case, to the extent that
such Information or Materials has been (i) in the public domain through no
fault of such Party or its Subsidiaries or any of their respective directors,
officers, employees, agents, accountants, counsel and other advisors and
representatives; (ii) 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 (iii) independently generated without reference
to any proprietary or confidential Information or Materials of the other Party.


 


(b)                                 NO
RELEASE, RETURN OR DESTRUCTION.  Each
Party agrees not to release or disclose, or permit to be released or disclosed,
any such Information or Materials to any other


 


13

















 


Person, except its directors, officers, employees, agents, accountants,
counsel, lenders, investors and other advisors and representatives who need to
know such Information or Materials, and except in compliance with Section 6(c).  Without limiting the foregoing, when any
Information or Materials furnished by the other Party after the Effective Date
pursuant to this Agreement is no longer needed for the purposes contemplated by
this Agreement, each Party shall, at such Party’s option, promptly after
receiving a written request from the other Party either return to the other
Party all such Information and Materials in a tangible form (including all
copies thereof and all notes, extracts or summaries based thereon) or certify
to the other Party that it has destroyed such Information and Materials (and
such copies thereof and such notes, extracts or summaries based thereon).


 


(c)                                  PROTECTIVE
ARRANGEMENTS.  In the event that either
Party or any of its Subsidiaries either determines on the advice of its counsel
that it is required to disclose any Information or Materials pursuant to
applicable law or the rules or regulations of any Governmental Authority or
receives any demand under lawful process or from any Governmental Authority to
disclose or provide Information or Materials of any other Party that is subject
to the confidentiality provisions hereof, such Party shall notify the other
Party prior to disclosing or providing such Information and Materials and shall
cooperate at the expense of the requesting Party in seeking any reasonable
protective arrangements requested by such other Party.  Subject to the foregoing, the Party that
received such request, or its Subsidiaries, may thereafter disclose or provide
Information and Materials to the extent required by such law (as so advised by
counsel) or by lawful process or such Governmental Authority.


 


Section 7.                                            MISCELLANEOUS.


 


(a)                                  MUTUAL
COOPERATION.  The Parties and their
respective Subsidiaries shall cooperate with each other in connection with the
performance of the Services hereunder and the completion of the Separation
Projects, including producing on a timely basis all Information and Materials
that is reasonably requested with respect to the performance of Services and the
completion of the Separation Projects, by the end of the term of this
Agreement; provided, however, that such cooperation shall not unreasonably
disrupt the normal operations of the Parties and their respective Subsidiaries.


 


(b)                                 LIMITATIONS
ON LIABILITY.


 


(i)                                     FOR
EACH TWELVE (12) MONTH PERIOD DURING WHICH THIS AGREEMENT IS IN EFFECT, THE
FIRST SUCH PERIOD COMMENCING ON THE EFFECTIVE DATE AND THE SECOND (AND ANY
SUBSEQUENT PERIODS) COMMENCING ON EACH ANNUAL ANNIVERSARY THEREOF, THE MAXIMUM
LIABILITY OF EACH PARTY AND ITS SUBSIDIARIES TO, AND THE SOLE REMEDY OF, EACH
PARTY AND ANY OF ITS SUBSIDIARIES WITH RESPECT TO ANY AND ALL CLAIMS ARISING
UNDER OR IN CONNECTION WITH THIS AGREEMENT, REGARDLESS OF THE THEORY UPON WHICH
THE LIABILITY IS PREMISED, SHALL NOT EXCEED THE PROFITS OF THE PARTY PROVIDING
THE SERVICES HEREUNDER, WHICH SHALL BE DEEMED TO BE EQUAL TO THE AMOUNT OF THE
MARK-UP RECEIVED BY THE PARTY PROVIDING THE SERVICES DURING SUCH


 


14

















 


TWELVE (12) MONTH PERIOD, AS SUCH AMOUNT IS SPECIFIED IN SCHEDULE D
AND AS MAY BE ADJUSTED PURSUANT TO THE TERMS OF SCHEDULE D.


 


(ii)                                  IN
NO EVENT SHALL EITHER PARTY, ITS SUBSIDIARIES OR ITS DIRECTORS, OFFICERS,
EMPLOYEES OR AGENTS BE LIABLE TO THE OTHER PARTY FOR INDIRECT, EXEMPLARY,
CONSEQUENTIAL, INCIDENTAL 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
AND ITS SUBSIDIARIES ANY CLAIM FOR SUCH DAMAGES, INCLUDING ANY CLAIM FOR
PROPERTY DAMAGE OR LOST PROFITS, WHETHER ARISING IN CONTRACT, TORT OR
OTHERWISE.


 


(iii)                               The
foregoing limitations on liability in this Section 7(b) shall not
apply to:  (i) either Party’s liability
for breaches of confidentiality under Section 6 (Confidentiality),
and (ii) either Party’s obligations under Section 7(c) (Third Party
Claims).


 


(c)                                  THIRD
PARTY CLAIMS AND INFRINGEMENT.


 


(i)                                     Except
for Third Party Claims addressed in Section 7(c)(iv) below, Abbott
shall indemnify, defend and hold harmless Hospira and its Subsidiaries, and
each of their respective directors, officers and employees, and each of the
successors and assigns of any of the foregoing (collectively, the “Hospira
Indemnitees”), from and against any and all Third Party claims relating to,
arising out of or resulting from Hospira, its Subsidiaries and/or any of their
respective officers, directors, employees, agents or contractors, furnishing or
failing to furnish the Services or Hospira Owned Materials required to be
provided by Hospira under this Agreement, other than Third Party claims arising
out of gross negligence or willful misconduct of Hospira, its Subsidiaries
and/or any of their respective directors, officers, employees, agents or contractors.


 


(ii)                                  Except
for Third Party Claims addressed in Section 7(c)(iii) below,
Hospira shall indemnify, defend and hold harmless Abbott and its Subsidiaries,
and each of their respective directors, officers and employees, and each of the
successors and assigns, of any of the foregoing (collectively, the “Abbott
Indemnitees”), from and against any and all Third Party claims relating to,
arising out of or resulting from Abbott, its Subsidiaries and/or any of their
respective officers, directors, employees, agents or contractors, furnishing or
failing to furnish the Services or Abbott Owned Materials required to be
provided by Abbott under this Agreement, other than Third Party claims arising
out of gross negligence or willful misconduct of Abbott, its Subsidiaries
and/or any of their respective directors, officers, employees, agents or
contractors.


 


(iii)                               For
any Abbott Owned Materials used or provided by Abbott or any Abbott Subsidiary
in connection with Abbott’s or any Abbott Subsidiary’s provision of Services
hereunder, but excluding any Materials provided or licensed under any Hospira
IT Agreement or any Shared IT Agreement, Abbott shall indemnify, defend and
hold harmless the Hospira Indemnitees from and against any and all Third Party
claims alleging that such Materials infringe upon the intellectual property
rights of any such Third Party.


 


15

















 


(iv)                              For
any Hospira Owned Materials used or provided by Hospira or any Hospira
Subsidiary in connection with Hospira’s or any Hospira Subsidiary’s provision
of Services hereunder, but excluding any Materials provided or licensed under
any Shared IT Agreement, Hospira shall indemnify, defend and hold harmless the
Abbott Indemnitees from and against any and all Third Party claims alleging
that such Materials infringe upon the intellectual property rights of any such
Third Party.


 


(v)                                 In
connection with any Third Party Claim alleging infringement regarding any
Materials, the indemnifying Party shall have the right in connection with such
affected Materials to (i) modify or replace the affected Materials so that they
are not infringing; (ii) procure a license for the indemnified Party in the
affected Materials such that use of the affected Materials may continue in the
required manner; or (iii) at the indemnifying Party’s sole option, the
indemnifying Party may cease use of the affected Materials, and, subject to any
rights and obligations set forth in Section 2(j), thereafter the
Parties shall cooperate in good faith and use commercially reasonable efforts
to arrive at an alternative solution or workaround that eliminates the need for
the affected Materials.


 


(vi)                              The
indemnification rights and obligations set forth in Sections 7(c)(iii), 7(c)(iv)
and 7(c)(v) shall be the sole and exclusive remedy for the indemnified
Party with respect to claims of infringement of intellectual property rights.


 


(vii)                           Notice
of Third Party Claims.  If at or
following the date of this Agreement an Indemnitee receives notice or otherwise
learns of the assertion or commencement by a Person (including any Governmental
Authority) other than Abbott or Hospira and their respective Subsidiaries of
any proceeding with respect to which an indemnifying Party may be obligated to
provide indemnification to such Indemnitee pursuant to Section 7(c)
(collectively, a “Third Party Claim”), such Indemnitee shall give such
indemnifying Party written notice thereof within twenty (20) days after
becoming aware of such Third Party Claim. 
Any such notice must describe the Third Party Claim in reasonable
detail.  Notwithstanding the foregoing,
the failure of any Indemnitee or other Person to give notice as provided in
this Section 7(c)(vii) shall not relieve the related indemnifying
Party of its obligations under Section 7(c), except to the extent
that such indemnifying Party is actually prejudiced by such failure to give
notice.


 


(d)                                 FORCE
MAJEURE.  Neither Party shall be deemed
in default of this Agreement to the extent that any delay or failure in the
performance of its obligations under this Agreement results from any cause
beyond its reasonable control and without its fault or negligence, such as acts
of God, acts of Governmental Authority, embargoes, epidemics, war, riots,
insurrections, acts of terrorism, fires, explosions, earthquakes, floods,
unusually severe weather conditions, labor problems or unavailability of parts,
or, in the case of computer systems, any failure in electrical or air
conditioning equipment, viruses or similar disabling devices, or breaches of
network or system security.  The Party
claiming an event of force majeure shall promptly notify the other Party in
writing, and provide full particulars of the cause or event and the date of
first occurrence thereof, as soon as possible after the event and also keep the
other Party informed of any further developments.  The Party so affected shall use its commercially reasonable
efforts to remove the cause of non-performance, and both the Parties shall
resume performance hereunder with the utmost dispatch when such cause is
removed unless this Agreement has previously been terminated under Section 5
hereof.


 


16

















 


(e)                                  RELATIONSHIP
GOVERNANCE.  Each of the Parties shall
appoint a separation services project executive or their designee from time to
time (each a “Project Executive”) who has responsibility for overseeing the
completion of the Services, respectively, and who shall have the authority to
act on behalf of the Parties, respectively, for all day-to-day matters
pertaining to this Agreement.  These
Project Executives shall meet no less frequently than monthly to review status,
consider changes to the Separation Project Plan, review and sign Work
Schedules, discuss, and if possible, resolve disputes, and provide direction to
the team members performing the Services. 
Additionally, each Party will have the option, but will not be
obligated, to designate additional representatives who will be authorized to
make certain decisions (e.g., regarding emergencies) if the Project Executive
is not available.  Each Party shall
cooperate with the other by, among other things, making available, as
reasonably requested by the other Party, management decisions, Information,
Materials, approvals and acceptances so that each Party may accomplish its
obligations and responsibilities hereunder. 
All transfers of Developed Materials and communications regarding the
scope of work shall be accomplished through the Project Executives.  In addition, the Project Executives shall arrange
and chair any progress review meetings, be responsible for ensuring that each
Party’s responsibilities have been met on a timely basis and shall control all
changes to the applicable Work Schedule(s). Either Party may change the person
designated to be its Project Executives for any Work Schedule at any time
upon written notice to the other Party’s Project Executive.  As of the Effective Date, except as
otherwise designated on an applicable Work Schedule, the Parties have
designated the following positions as the Project Executives for purposes of
this Agreement:


 


Abbott: Vice President, Information Technology


 


Hospira: Vice President, Information Technology


 


(f)                                    ACCEPTANCE.  Acceptance shall occur when the Services and
Materials described in the Work Schedule meet the agreed upon acceptance
criteria as described in the Work Schedule. 
If the Services and Materials do not meet the acceptance criteria as set
forth in the Work Schedule when they are ready for acceptance evaluation,
a Party may give the other Party detailed written notification of the
deficiency or non-conformance within thirty (30) business days of delivery of
the Services or Materials.  The
providing Party then shall either correct the deficiency or non-conformance or
provide a plan acceptable for correcting the deficiency or
non-conformance.  If the deficiency or
non-conformance is not corrected or if an acceptable plan for correcting such
deficiency or non-conformance is not established during such period, then the
aggrieved Party may initiate an ADR proceeding pursuant to Section 7(k).


 


(g)                                 AUDIT
ASSISTANCE.


 


(i)                                     Generally.  Each of the Parties and their respective
Subsidiaries are or may be subject to regulation and audit by governmental
bodies, standards organizations, other regulatory authorities, customers or
other parties to contracts with such parties under applicable law and contract
provisions.  If a governmental body,
standards organization, other regulatory authority or customer or other Party
to a contract with a Party or a 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, rules, regulations,
standards or contract provisions, the other Party shall provide all assistance
requested by the Party that is subject to the


 


17

















 


audit in responding to such audits or requests for information, to the
extent that such assistance or information is within the reasonable control of
the cooperating Party.  The Parties may
execute a Work Schedule if mutually desired to document the work effort
and Charges that may be required in connection with an audit.


 


(ii)                                  Controls.  After the Effective Date and continuing no
longer than required in accordance with the maintaining Party’s applicable
document retention policies, subject to the provisions of the TSA, each of the
Parties will maintain in effect, at its own cost and expense, adequate controls
to the extent reasonably necessary to enable the other Party to satisfy its
reporting, accounting, audit and other obligations.


 


(h)                                 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.


 


(i)                                     NO
THIRD PARTY BENEFICIARIES.  Except as
expressly provided in Section 7(c), the provisions of this
Agreement are solely for the benefit of the Parties and their Subsidiaries and
are not intended to confer upon any Person except the Parties any rights or
remedies hereunder.  Except for the
Hospira Indemnitees and the Abbott Indemnitees, there are no Third Party
beneficiaries of this Agreement and this Agreement shall not provide any Third
Party with any remedy, claim, liability, reimbursement, claim of action or
other right in excess of those existing without reference to this Agreement.


 


(j)                                     GOVERNING
LAW.  This Agreement shall be governed
by and construed and interpreted in accordance with the laws of the State of
Illinois irrespective of the choice of laws principles of the State of
Illinois, as to all matters, including matters of validity, construction,
effect, enforceability, performance and remedies.


 


(k)                                  ADR
PROCEDURES; EQUITABLE RELIEF.  The
Parties acknowledge that from time to time during the term of this Agreement a
dispute may arise relating to either Party’s rights or obligations under this
Agreement.  The Parties agree that any
such controversy, dispute or claim (whether arising in contract, tort or
otherwise) arising out of or relating in any way to this Agreement (including
the interpretation or validity of this Agreement), shall be resolved by the
Alternative Dispute Resolution (“ADR”) provisions set forth in this Section 7(k)
and Schedule F, the result of which shall be binding upon the
Parties.


 


(i)                                     Notice.  To initiate the ADR process, a Party first
must send written notice to the other Party in accordance with the provisions
of Section 7(q) describing the dispute and requesting attempted
resolution by good faith negotiations. 
Good faith negotiations shall be conducted in two stages, with the
second stage being triggered only if first stage negotiations do not result in
a resolution of the dispute.


 


(ii)                                  First
Stage Negotiations.  Following
receipt of the written notice described in the preceding paragraph, the
respective CEOs or Presidents of the Parties shall designate a group of no more
than three individuals, exclusive of counsel, to participate in good faith


 


18

















 


negotiations aimed at resolving the dispute.  Within 21 days from receipt of the written notice, the respective
groups shall meet in-person to conduct good faith negotiations.  By mutual written consent, the Parties may
extend the 21-day period for conducting first stage negotiations.  If the Parties fail to meet within the
21-day period or the Parties fail to resolve the dispute during such period,
and the period is not extended by mutual written agreement, the Parties shall
engage in second stage negotiations as described in the next paragraph.


 


(iii)                               Second
Stage Negotiations.  Following the
expiration of the 21-day period described in the preceding paragraph, or any
extension thereof mutually agreed to in writing, if the Parties are unable to
resolve the dispute, they shall engage in second stage negotiations.  Second stage negotiations shall be conducted
between the respective CEOs or Presidents (or their designees) of the Parties
within 14 days following the conclusion of first stage negotiations.  If the dispute has not been resolved within
the 14 days provided for second stage negotiations, either Party may initiate
an ADR proceeding as provided in Schedule F.  The Parties shall have the right to be
represented by counsel in such a proceeding.


 


Notwithstanding the foregoing, the Parties acknowledge that the breach
of Section 3 (Ownership and License Rights in Materials), Section 6
(Confidentiality), and/or Section 2(i) (Security Procedures) by one
Party may give rise to irreparable injury to the other Party which is not
adequately compensable in damages or at law. 
Accordingly, the Parties agree that in such event, the non-breaching
party may seek equitable relief to enforce or prevent violation of such Party’s
respective rights and/or obligations under those Sections.  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 this Section 7(k) and Schedule F with
respect to all matters subject to such dispute, controversy or claim; provided,
however, that this obligation shall only exist during the term of this
Agreement.


 


(l)                                     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 hereto) and not to any particular
provision of this Agreement.  “Section”
and “Schedule” references are to the Sections 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 agreements contemplated
herein shall be deemed to refer to this Agreement or such other agreement as of
11:59 pm Eastern Daylight Time on the Effective Date and as such time may be
amended thereafter, unless otherwise specified.


 


(m)                               SURVIVAL.  Section 1 (Definitions), Section 3
(Billing; Taxes), Section 5 (Confidentiality), Sections 2(b),
2(c)(iii), 2(d), 2(e) (with respect to those portions of Schedule F
that survive termination), 7(b) (Liability), 7(c) (Third Party
Claims), 7(g) (Audit Assistance), and


 


19

















 


7(i) (No Third Party Beneficiaries) through  7(t) (Severability) shall
survive any expiration or termination of this Agreement.


 


(n)                                 ASSIGNMENT.  This Agreement shall be binding upon and
inure to the benefit of the Parties hereto and their respective successors and
permitted assigns; PROVIDED, HOWEVER, that neither Party may assign its rights
or delegate its obligations under this Agreement without the express prior
written consent of the other Party hereto. 
Notwithstanding the foregoing, this Agreement shall be assignable by
either Party in whole with the prior written consent of the other Party (which
consent shall not be unreasonably withheld, delayed or conditioned) in
connection with: (i) a merger or consolidation of such Party if (a) such Party
is not the surviving entity, or (b) such Party’s shareholders constitute less
than 70% of the surviving shareholders; (ii) the sale of all or substantially
all of the assets of such Party; or (iii) the acquisition by a Third Party of
at least 30% of the combined voting power of the then-outstanding securities of
such Party entitled to vote generally in the election of directors (each such
occurrence, a “Change of Control Event”), in each case so long as the
resulting, surviving or transferee Person assumes all the obligations of the
assignor hereunder by operation of law or pursuant to an agreement in form and
substance reasonably satisfactory to the other Party.  It shall not be deemed to be unreasonable for a Party to withhold
consent to assignment in connection with a Change of Control Event on the basis
that the proposed assignee is a competitor of such Party.  In the event a Party effects a Change of
Control Event without the other Party’s prior written consent to assign this
Agreement as set forth above, the latter Party may terminate this Agreement, in
its sole discretion, with effect immediately upon the occurrence of such Change
of Control Event.


 


(o)                                 AMENDMENT.  No amendment to this Agreement shall be
effective unless it is in writing and signed by a duly authorized
representative of each Party or, in the case of an amendment (including an
early termination) of a Work Schedule, signed by the contact listed on the
applicable Work Schedule, or by such contact’s senior management.


 


(p)                                 NO
WAIVERS.  No failure or delay of any
Party in exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power,
or any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power.  The rights and remedies
of the Parties and their Subsidiaries hereunder are cumulative and are not
exclusive of any rights or remedies which they would otherwise have hereunder.  No provision 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.


 


(q)                                 NOTICES.  All notices or other communications under
this Agreement must be in writing and shall be deemed to be duly given (i) when
delivered in person, (ii) upon transmission via confirmed facsimile
transmission, provided that such transmission is followed by delivery of a
physical copy thereof in person, via U.S. first class mail, or via a private
express mail courier, or (iii) two days after deposit with a private express
mail courier, in any such case addressed as follows:


 


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  To Abbott:

  	
   

  	
  Abbott Laboratories

  200 Abbott Park Road

  Building J46, Department 334

  Abbott Park, Illinois 60064-6020

  Attn: Vice President, Information Technology

  Facsimile Number: (847) 935-3253

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  Abbott Laboratories

  100 Abbott Park Road

  Building AP6D, Department 364

  Abbott Park, Illinois 60064-6020

  Attn: General Counsel

  Facsimile Number: (847) 938-1561

  
	
   

  	
   

  	
   

  
	
  To Hospira:

  	
   

  	
  Hospira, Inc.

  Dept. 98F

  275 North Field Drive

  Lake Forest, Illinois 60045-5045

  Attn:  Vice President, Information
  Technology

  Facsimile Number: (847) 937-2927

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  Hospira, Inc.

  Legal Department

  Dept. NLEG

  275 North Field Drive

  Lake Forest, Illinois 60045-5045

  Attn: General Counsel

  Facsimile Number: (224) 212-3312

  



 


Any Party may, by notice to the other Party, change the address to
which such notices are to be given.


 


(r)                                    COUNTERPARTS.  This Agreement may be executed in one or
more counterparts (including by means of faxed signature pages), all of which
shall be considered one and the same agreement, and shall become effective when
one or more such counterparts have been signed by each of the Parties and
delivered to the other Party.


 


(s)                                  ENTIRE
AGREEMENT.  This Agreement and the
Schedules hereto contain the entire agreement and understanding between the
Parties with respect to the subject matter hereof and supersede all prior
agreements and understandings, whether written or oral, relating to such
subject matter; provided, that except as otherwise expressly agreed by the
Parties.


 


(t)                                    SEVERABILITY.  If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof or thereof, or the application of such provision to Persons
or circumstances or in jurisdictions other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall in no
way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby or thereby, as the case
may be, is not affected in any manner adverse to any Party.  Upon such determination, the Parties shall
negotiate in good faith in an effort to agree upon a suitable and equitable
provision to effect the original intent of the Parties.


 


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IN WITNESS WHEREOF,
the Parties have executed this Agreement as of the date first written above.


 


	
  ABBOTT LABORATORIES

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:  Thomas C. Freyman

  	
   

  
	
   

  	
  Title: 
  Executive Vice President, Finance

  and Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  HOSPIRA, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:  John Arnott

  	
   

  
	
   

  	
  Title: Senior Vice President, Global Commercial Operations

  	
   

  
					



 


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