WWW.EXFILE.COM, INC. -- 14526 -- BOSTON SCIENTIFIC CORP. -- EXHIBIT 10.2 TO FORM 10-Q


    EXHIBIT
      10.2

     

    FINAL
      FORM

     

    


     

    


     

    


     

    


     

    ____________________

     

    PURCHASE
      AGREEMENT

     

    ____________________

     

    Between


     

    GUIDANT
      CORPORATION


     

    and


     

    ABBOTT
      LABORATORIES


     

    


     

    


     

    Dated
      as
      of April 21, 2006

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    TABLE
      OF CONTENTS

    

      
        	
                 

              	
                Page 

              
	
                ARTICLE
                  I 

              
	
                DEFINITIONS

              
	 	 
	
                SECTION
                  1.01. Certain Defined Terms

              	
                2

              
	 	 
	
                SECTION
                  1.02. Definitions

              	
                9

              
	
                ARTICLE
                  II 

              
	
                PURCHASE
                  AND SALE

              
	 	 
	
                SECTION
                  2.01. Purchase and Sale of the Shares

              	
                11

              
	
                SECTION
                  2.02. Purchase and Sale of Assets

              	
                11

              
	
                SECTION
                  2.03. Assumption and Exclusion of Liabilities

              	
                15

              
	
                SECTION
                  2.04. Purchase Price; Allocation of Purchase Price

              	
                16

              
	
                SECTION
                  2.05. Milestone Payments

              	
                17

              
	
                SECTION
                  2.06. Closing

              	
                17

              
	
                SECTION
                  2.07. Closing Deliveries by Guidant

              	
                18

              
	
                SECTION
                  2.08. Closing Deliveries by Abbott

              	
                19

              
	 
	
                ARTICLE
                  III 

              
	
                REPRESENTATIONS
                  AND WARRANTIES OF GUIDANT

              
	 
	
                SECTION
                  3.01. Organization, Authority and Qualification

              	
                20

              
	
                SECTION
                  3.02. Organization, Authority and Qualification of the Transferred
                  Subsidiaries

              	
                20

              
	
                SECTION
                  3.03. Capitalization; Ownership of Shares

              	
                20

              
	
                SECTION
                  3.04. No Conflict

              	
                21

              
	
                SECTION
                  3.05. Governmental Consents and Approvals

              	
                22

              
	
                SECTION
                  3.06. Conduct in the Ordinary Course

              	
                22

              
	
                SECTION
                  3.07. Litigation

              	
                23

              
	
                SECTION
                  3.08. Compliance with Laws

              	
                23

              
	
                SECTION
                  3.09. Environmental Matters

              	
                24

              
	
                SECTION
                  3.10. Intellectual Property

              	
                24

              
	
                SECTION
                  3.11. Title

              	
                26

              
	
                SECTION
                  3.12. Employee Benefit Matters

              	
                26

              
	
                SECTION
                  3.13. Taxes

              	
                30

              
	
                SECTION
                  3.14. Material Contracts

              	
                31

              
	
                SECTION
                  3.15. Regulatory Matters

              	
                32

              
	
                SECTION
                  3.16. Assets

              	
                34

              
	
                SECTION
                  3.17. Brokers

              	
                34

              
	
                SECTION
                  3.18. Disclaimer

              	
                34

              
	 
	
                ARTICLE
                  IV 

              
	
                REPRESENTATIONS
                  AND WARRANTIES OF ABBOTT

              
	 
	
                SECTION
                  4.01. Organization and Authority

              	
                34

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	
                SECTION
                  4.02. No Conflict

              	
                35

              
	
                SECTION
                  4.03. Governmental Consents and Approvals

              	
                35

              
	
                SECTION
                  4.04. Litigation

              	
                36

              
	
                SECTION
                  4.05. Brokers

              	
                36

              
	
                SECTION
                  4.06. Disclaimer

              	
                36

              
	 
	
                ARTICLE
                  V 

              
	
                ADDITIONAL
                  AGREEMENTS

              
	 
	
                SECTION
                  5.01. Acknowledgment

              	
                36

              
	
                SECTION
                  5.02. Access to Information; Confidentiality

              	
                36

              
	
                SECTION
                  5.03. Regulatory and Other Authorizations; Notices and
                  Consents

              	
                37

              
	
                SECTION
                  5.04. Notifications

              	
                38

              
	
                SECTION
                  5.05. Release of Indemnity Obligations

              	
                39

              
	
                SECTION
                  5.06. Tax Election

              	
                39

              
	
                SECTION
                  5.07. Insurance

              	
                41

              
	
                SECTION
                  5.08. Trademarks

              	
                41

              
	
                SECTION
                  5.09. Further Action

              	
                43

              
	
                SECTION
                  5.10. Mixed Contracts and Accounts

              	
                44

              
	
                SECTION
                  5.11. Intercompany Arrangements

              	
                45

              
	
                SECTION
                  5.12. Restructuring

              	
                45

              
	
                SECTION
                  5.13. Books, Records and Files

              	
                45

              
	
                SECTION
                  5.14. Other Agreements

              	
                46

              
	
                SECTION
                  5.15. Third Party Claims Against Both the Business and the Excluded
                  Business

              	
                46

              
	 
	
                ARTICLE
                  VI 

              
	
                EMPLOYEE
                  MATTERS

              
	 
	
                SECTION
                  6.01. Transferred Employees

              	
                47

              
	
                SECTION
                  6.02. Employee Benefits

              	
                47

              
	
                SECTION
                  6.03. General Matters

              	
                50

              
	
                SECTION
                  6.04. Mutual Non-Solicitation

              	
                51

              
	 
	
                ARTICLE
                  VII 

              
	
                TAXES

              
	 
	
                SECTION
                  7.01. Apportionment

              	
                52

              
	
                SECTION
                  7.02. Tax Return Filing and Amendment

              	
                52

              
	
                SECTION
                  7.03. Refunds

              	
                53

              
	
                SECTION
                  7.04. Resolution of Tax Controversies

              	
                53

              
	
                SECTION
                  7.05. Tax Cooperation

              	
                53

              
	
                SECTION
                  7.06. Conveyance Taxes

              	
                53

              
	 
	
                ARTICLE
                  VIII 

              
	
                CONDITIONS
                  TO CLOSING

              
	 
	
                SECTION
                  8.01. Conditions to Obligation of Guidant

              	
                54

              
	
                SECTION
                  8.02. Conditions to Obligation of Abbott

              	
                55

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	 
	
                ARTICLE
                  IX 

              
	
                TERMINATION

              
	 
	
                SECTION
                  9.01. Termination

              	
                56

              
	
                SECTION
                  9.02. Effect of Termination

              	
                56

              
	 
	
                ARTICLE
                  X 

              
	
                INDEMNIFICATION

              
	 
	
                SECTION
                  10.01. Survival of Representations and Warranties

              	
                56

              
	
                SECTION
                  10.02. Indemnification by Guidant

              	
                56

              
	
                SECTION
                  10.03. Indemnification by Abbott

              	
                57

              
	
                SECTION
                  10.04. Limits on Indemnification

              	
                57

              
	
                SECTION
                  10.05. Notice of Loss; Third Party Claims

              	
                58

              
	
                SECTION
                  10.06. Tax Treatment of Indemnity Payments

              	
                58

              
	 
	
                ARTICLE
                  XI 

              
	
                GENERAL
                  PROVISIONS

              
	 
	
                SECTION
                  11.01. Expenses

              	
                59

              
	
                SECTION
                  11.02. Notices

              	
                59

              
	
                SECTION
                  11.03. Public Announcements

              	
                60

              
	
                SECTION
                  11.04. Severability

              	
                60

              
	
                SECTION
                  11.05. Entire Agreement

              	
                60

              
	
                SECTION
                  11.06. Assignment

              	
                61

              
	
                SECTION
                  11.07. Amendment

              	
                61

              
	
                SECTION
                  11.08. Waiver

              	
                61

              
	
                SECTION
                  11.09. No Third Party Beneficiaries

              	
                61

              
	
                SECTION
                  11.10. Other Remedies; Specific Performance

              	
                61

              
	
                SECTION
                  11.11. Interpretive Rules

              	
                62

              
	
                SECTION
                  11.12. Guarantees of Performance

              	
                62

              
	
                SECTION
                  11.13. Governing Law

              	
                62

              
	
                SECTION
                  11.14. Waiver of Jury Trial

              	
                63

              
	
                SECTION
                  11.15. Exchange Rate

              	
                63

              
	
                SECTION
                  11.16. Counterparts

              	
                63

              
	
                 

              	 


      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBITS:

     

    Exhibit
      A -
      Form of
      Assumption Agreement

    Exhibit
      B -
      Form of
      Bill of Sale

    Exhibit
      C -
      Form of
      Business Transfer Agreement

    Exhibit
      D -
      Form of
      Equity Purchase Agreement

    Exhibit
      E -
      Form of
      Intellectual Property Transfer Agreement

    Exhibit
      F -
      Form of
      License and Technology Transfer Agreement

    Exhibit
      G -
      Form of
      Note

    Exhibit
      H -
      Form of
      Release

    Exhibit
      I -
      Form of
      Supply Agreement

    Exhibit
      J -
      Form of
      Transition Services Agreement


     

    SCHEDULES:

     

    Schedule
      1.01(a)  - Asset
      Purchasers & Asset Sellers 

    Schedule
      1.01(b) - Leased
      Business Real Property

    Schedule
      1.01(c) - Owned
      Business Real Property

    Schedule
      1.01(d) - Share
      Sellers, Share Purchasers & Transferred Subsidiaries

    Schedule
      2.02(a)(i) - Clonmel
      -
      Purchased Assets

    Schedule
      2.02(a)(ii) - Leased
      Business Real Property - Purchased Assets

    Schedule
      2.02(a)(iii) - Guidelines
      for Tangible Personal Property

    Schedule
      2.02(a)(xv) - Guidelines
      for Permits, Licenses, Certifications & Approvals

    Schedule
      2.02(a)(xvi) - Guidelines
      for Computer Software Data and Information

    Schedule
      2.02(a)(xxi) - Assets

    Schedule
      2.02(c)(iv) - Real
      Property - Excluded Assets

    Schedule
      2.02(d) - Investments

    Schedule
      2.02(e) - Intellectual
      Property Transfers

    Schedule
      2.04(a) - Withholding
      Taxes

    Schedule
      2.06 - Required
      Consent Jurisdictions & Deferred Local Closings

    Schedule
      5.12 - Restructuring
      Actions

    Schedule
      6.01(a) - U.S.
      Business Employees

    Schedule
      6.01(b) - Non-U.S.
      Business Employees

    Schedule
      6.02(f) - Payment
      Principles

     

    


     

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     


    PURCHASE
      AGREEMENT, dated as of April 21, 2006 (this “Agreement”),
      between GUIDANT CORPORATION, an Indiana corporation (“Guidant”),
      and
      ABBOTT LABORATORIES, an Illinois corporation (“Abbott”).

     

    WHEREAS,
      Boston Scientific Corporation, a Delaware corporation (“Boston
      Scientific”),
      Galaxy Merger Sub, Inc., an Indiana corporation and a wholly owned subsidiary
      of
      the Boston Scientific (“Sub”),
      and
      Guidant have entered into an Agreement and Plan of Merger (the “Merger
      Agreement”),
      dated
      as of January 25, 2006, pursuant to which, upon consummation of the Merger
      (as
      defined in the Merger Agreement), Sub will be merged with and into Guidant
      and
      Guidant will become a wholly owned subsidiary of Boston Scientific;


     

    WHEREAS,
      Guidant, directly and through its various Affiliates (as defined below),
      including the Transferred Subsidiaries (as defined below) and the Asset Sellers
      (as defined below), is engaged in, among other things, the vascular intervention
      and endovascular solutions businesses at various locations around the world
      (such businesses of Guidant and its Affiliates, collectively, the “Business”);

     

    WHEREAS,
      certain assets of the Transferred Subsidiaries that are not primarily used
      in
      the Business will be transferred by the Transferred Subsidiaries to Guidant,
      Boston Scientific or one of their respective Affiliates prior to the Closing,
      the Excluded Liabilities (as defined below) of the Transferred Subsidiaries
      will
      be assumed by Guidant, Boston Scientific or one of their respective Affiliates
      prior to the Closing, and the Shares (as defined below) and the Purchased Assets
      (as defined below) will be sold by Guidant or the applicable Seller (as defined
      below) to the applicable Purchaser (as defined below) at the Closing, all as
      more fully set forth herein; 

     

    WHEREAS,
      for purposes of this Agreement, references to the Business shall be deemed
      to
      include the Assets (as defined below) and the Shares if the context so requires;
      

     

    WHEREAS,
      subject to the satisfaction or (to the extent permitted by Law) waiver of the
      conditions to the parties’ obligations to close the transactions contemplated by
      the Merger Agreement, Guidant wishes to sell, or cause to be sold, to the
      Purchasers, and the Purchasers wish to purchase from Guidant and the Sellers,
      the Transferred Subsidiaries and all right, title and interest in and to all
      assets of the Business, and in connection therewith the Purchasers are willing
      to assume certain liabilities relating thereto, all upon the terms and subject
      to the conditions set forth herein; and

     

    WHEREAS,
      simultaneously with the execution of this Agreement, Boston Scientific has
      executed that certain Guarantee of Performance (the “Guarantee
      of Performance”),
      pursuant to which Boston Scientific unconditionally guarantees to Abbott the
      prompt and complete performance of all the obligations required to be performed
      by Guidant and its Affiliates pursuant to this Agreement.

     

    NOW,
      THEREFORE, in consideration of the promises and the mutual agreements and
      covenants hereinafter set forth, and intending to be legally bound, the parties
      hereby agree as follows:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ARTICLE
      I


     

    DEFINITIONS

    SECTION
      1.01.   Certain
      Defined Terms. 
      For
      purposes of this Agreement:

     

    “Action”
means
      any claim, action, suit, arbitration, inquiry, proceeding or investigation
      by or
      before any Governmental Authority or arbitral or similar forum.

     

    “Affiliate”
means,
      with respect to any specified Person, any other Person that directly, or
      indirectly through one or more intermediaries, controls, is controlled by,
      or is
      under common control with, such specified Person; provided,
      however
      that TAP
      Pharmaceutical Products, Inc. (“TAP”)
      and
      its subsidiaries shall be deemed not to be Affiliates of Abbott, but only for
      so
      long as Abbott (either directly or indirectly) owns fifty percent or less of
      the
      voting stock of TAP (or its subsidiaries) or does not otherwise have control
      of
      TAP (or its subsidiaries). For purposes of this Agreement, with respect to
      all
      periods following consummation of the Merger or the transactions contemplated
      by
      this Agreement, as applicable, “Affiliate” shall include, (a) with respect to
      Boston Scientific, Guidant and its Affiliates following the Merger, (b) with
      respect to Guidant, Boston Scientific and its Affiliates following the Merger,
      (c) with respect to Abbott, any Person to be acquired pursuant to this
      Agreement, and (d) with respect to each party hereto, any Person resulting
      from
      any internal reorganization, provided such resulting Person is an
      Affiliate.

     

    “Ancillary
      Agreements”
means
      the Assumption Agreements, the Equity Purchase Agreement, the Bills of Sale,
      the
      Transfer Agreements, the Supply Agreements, the License and Technology Transfer
      Agreement, the Transition Services Agreement, the Note, the Release and any
      other agreements that the parties may mutually agree.

     

    “Assets”
means
      (i) the Purchased Assets and (ii) the assets, rights, properties and businesses
      of every kind and description (wherever located, whether tangible or intangible,
      real, personal or mixed) of the Transferred Subsidiaries, in each case that
      (except as otherwise expressly set forth in this Agreement or the Ancillary
      Agreements) are used primarily in, or related primarily to (with “primarily”
being determined by taking into account revenues, assets, personnel,
      registrations and other relevant factors), the Business. 

     

    “Asset
      Purchasers”
means,
      individually or collectively, the Affiliates of Abbott that are identified
      on
      Schedule 1.01(a) attached hereto.

     

    “Asset
      Sellers”
means,
      individually or collectively, the Affiliates of Guidant that are identified
      on
      Schedule 1.01(a) attached hereto.

     

    “Assumption
      Agreements”
means
      the Assumption Agreements to be executed by the applicable Asset Purchasers
      and
      Guidant and/or the applicable Asset Sellers at the Closing, substantially in
      the
      form of Exhibit A. 

     

    “Bills
      of Sale”
means
      the Bills of Sale and Assignment to be executed by Guidant and/or the applicable
      Asset Sellers at the Closing, substantially in the form of
      Exhibit B.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Books,
      Records and Files”
means
      any studies, reports, records (including shipping and personnel records), books
      of account, invoices, contracts, instruments, surveys, data (including
      financial, sales, purchasing and operating data), computer data, disks,
      diskettes, tapes, marketing plans, customer lists, supplier lists, distributor
      lists, correspondence and other documents. 

     

    “Business
      Day”
means
      any day that is not a Saturday, a Sunday or other day on which banks are
      required or authorized by Law to be closed in The City of New York.

     

    “Business
      Intellectual Property”
means
      all Intellectual Property used primarily in, or related primarily to, the
      Business and (a) owned by Guidant or any of its Affiliates or (b) licensed
      to or
      by, or controlled by, Guidant or any of its Affiliates.

     

    “Business
      Transfer Agreements”
means
      the Business Transfer Agreements with respect to the relevant jurisdiction
      to be
      executed by the applicable Asset Sellers and the applicable Asset Purchasers
      at
      the Closing, substantially in the form of Exhibit C.

     

    “Carotid
      Stent Assets”
means
      the Assets related to the research, development, manufacture, distribution,
      marketing and sale of carotid stent systems, including embolic protection
      devices.

     

    “Code”
means
      the Internal Revenue Code of 1986, as amended through the date
      hereof.

     

    “Contract”
means
      any loan or credit agreement, bond, debenture, note, mortgage, indenture, lease,
      supply agreement, license agreement, development agreement or other contract,
      agreement, obligation, commitment or instrument that is intended by Guidant
      or
      any of its Affiliates to be legally binding, including all amendments
      thereto.

     

    “control”
      (including the terms “controlled
      by”
and
      “under
      common control with”),
      with
      respect to the relationship between or among two or more Persons, means the
      possession, directly or indirectly or as trustee, personal representative or
      executor, of the power to direct or cause the direction of the affairs or
      management of a Person, whether through the ownership of voting securities,
      as
      trustee, personal representative or executor, by contract, credit arrangement
      or
      otherwise.

     

    “Credit
      Agreement”
means
      the principal credit agreement of Boston Scientific, as amended, restated,
      modified, renewed, refunded, replaced or refinanced, in whole or in part from
      time to time.

     

    “Disclosure
      Schedule”
means
      the Disclosure Schedule attached hereto, dated as of the date hereof, delivered
      by Guidant to Abbott in connection with this Agreement. 

     

    “Encumbrance”
means
      (a) with respect to the Shares, or any other shares of capital stock of a
      Transferred Subsidiary, any voting trusts, shareholders’ agreement, proxy or
      other similar restriction, and (b) with respect to the Assets and the Shares,
      any security interest, pledge, hypothecation, mortgage, lien, adverse ownership
      claim, title defect or other 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    encumbrance
      of any kind or nature whatsoever, other than, with respect to Intellectual
      Property included in the Assets, any licenses of Intellectual
      Property.

     

    “Environmental
      Laws”
means
      any United States Federal, state or local or any foreign Laws (including the
      common law), Governmental Orders, notices, Permits or binding Contracts issued,
      promulgated or entered into by any Governmental Authority, relating in any
      way
      to the environment, preservation or reclamation of natural resources or the
      presence, management, Environmental Release of, or exposure to, Hazardous
      Materials, or to human health and safety.

     

    “Environmental
      Release”
means
      any spilling, leaking, pumping, pouring, emitting, emptying, discharging,
      injecting, escaping, leaching, dumping, disposing or migrating into or through
      the environment or any natural or man-made structure.

     

    “Equity
      Purchase Agreement”
means
      the Subscription and Stockholders Agreement, to be executed at the Closing
      between Boston Scientific and Abbott in the form of Exhibit D.

     

    “FDA”
means
      the United States Food and Drug Administration.

     

    “GAAP”
means
      United States generally accepted accounting principles and practices in effect
      from time to time applied consistently throughout the periods
      involved.

     

    “Governmental
      Authority”
means
      any United States federal, state or local or any non-United States government,
      governmental, regulatory or administrative authority, agency or commission
      or
      any court, tribunal, or judicial or arbitral body.

     

    “Governmental
      Order”
means
      any order, writ, judgment, injunction, decree, stipulation, determination or
      award entered by or with any Governmental Authority.

     

    “Hazardous
      Materials”
means
      (a) petroleum products and by-products, asbestos and asbestos-containing
      materials, urea formaldehyde foam insulation, medical or infectious wastes,
      polychlorinated byphenyls, radon gas, radioactive substances, chloroflurocarbons
      and all other ozone-depleting substances, and (b) any other chemical, material,
      substance, waste, pollutant or contaminant that is prohibited, limited or
      regulated by or pursuant to any Environmental Law.

     

    “HSR
      Act”
means
      the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the
      rules and regulations thereunder.

     

    “Indebtedness”
means,
      with respect to any Person at any date, without duplication, (a) all
      indebtedness of such Person for borrowed money, (b) all obligations of such
      Person for the deferred purchase price of property or services (other than
      current trade payables incurred in the ordinary course of such Person’s
      business), (c) all obligations of such Person evidenced by notes, bonds,
      debentures or other similar instruments, (d) all indebtedness created or arising
      under any conditional sale or other title retention agreement with respect
      to
      property acquired by such Person (even though the rights and remedies of the
      seller or lender under such agreement in the event of default are limited to
      repossession or sale of such property), (e) all 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    capital
      lease obligations of such Person, (f) all obligations of such Person, contingent
      or otherwise, as an account party or applicant under or in respect of
      acceptances, letters of credit, surety bonds or similar arrangements, (g) all
      guarantee obligations of such Person in respect of obligations of the kind
      referred to in clauses (a) through (f) above and (h) all obligations of the
      kind
      referred to in clauses (a) through (g) above secured by (or for which the holder
      of such obligation has an existing right, contingent or otherwise, to be secured
      by) any lien on property (including accounts and contract rights) owned by
      such
      Person, whether or not such Person has assumed or become liable for the payment
      of such obligation. The Indebtedness of any Person shall include the
      Indebtedness of any other entity (including any partnership in which such Person
      is a general partner) to the extent such Person is liable therefor as a result
      of such Person’s ownership interest in or other relationship with such entity,
      except to the extent the terms of such Indebtedness expressly provide that
      such
      Person is not liable therefor.

     

    “Intellectual
      Property”
means
      all intellectual property rights of any kind, including rights in, to and
      concerning (a) patents, patent applications and statutory invention
      registrations, including divisionals, continuations, continuations-in-part,
      re-issues and re-examinations thereof, (b) Trademarks, (c) published
      and unpublished works of authorship and copyrights therein, and copyright
      registrations and applications for registration thereof and all renewals,
      extensions, restorations and reversions thereof, (d) software, code, data,
      databases and compilations of information, and (e) confidential and
      proprietary information, inventions, formulas, processes, developments,
      technology, research, trade secrets and know-how.

     

    “Intellectual
      Property Transfer Agreement”
means
      the Intellectual Property Transfer Agreements with respect to the relevant
      jurisdictions to be executed by Advanced Cardiovascular Systems, Inc., its
      subsidiaries or Guidant Endovascular Solutions, Inc. and the applicable Asset
      Purchaser immediately prior to the Closing, substantially in the form of Exhibit
      E.

     

    “IRS”
means
      the Internal Revenue Service of the United States.

     

    “Knowledge”
means,
      when used in connection with (a) a Purchaser with respect to any matter in
      question, the actual knowledge of Abbott’s executive officers after making due
      inquiry of the current employees having primary responsibility for such matter,
      and (b) Guidant with respect to any matter in question, the actual knowledge
      of
      Guidant’s executive officers after making due inquiry of the current employees
      of Guidant or any of its Affiliates having primary responsibility for such
      matter who are treated as a Tier I Employee and Tier II Employee for purposes
      of
      the Guidant CIC Plans.

     

    “Law”
means
      any United States federal, state, local or foreign statute, law, ordinance,
      regulation, rule, code, order, other requirement or rule of law.

     

    “Leased
      Business Real Property”
means
      all the Real Property leased by Guidant, any Asset Seller or any Transferred
      Subsidiary, as tenant and described on Schedule 1.01(b) that are acquired,
      directly or indirectly, by the Purchasers by the way of a Share purchase or
      as a
      Purchased Asset pursuant to the transactions contemplated by this Agreement.
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Liabilities”
means
      any and all debts, liabilities and obligations, whether accrued or fixed,
      absolute or contingent, matured or unmatured or determined or determinable,
      including those arising under any Law, Action or Governmental Order and those
      arising under any contract, agreement, arrangement or undertaking (but excluding
      any performance obligations under any such contracts, agreements, arrangements
      or undertakings).

     

    “License
      and Technology Transfer Agreement”
means
      the License and Technology Transfer Agreement dated as of ________, 2006, among
      Boston Scientific, Guidant and Abbott, in the form of Exhibit F.

     

    “Material
      Adverse Effect”
means
      any change, effect, event, occurrence, state of facts or development which
      individually or in the aggregate would reasonably be expected to result in
      any
      change or effect, that is materially adverse to the business, financial
      condition or results of operations of the Business, taken as a whole;
provided,
      however,
      that
      none of the following shall be deemed, either alone or in combination, to
      constitute, and none of the following shall be taken into account in determining
      whether there has been or will be, a Material Adverse Effect: (a) any change,
      effect, event, occurrence, state of facts or development (i) in the financial
      or
      securities markets or the economy in general, (ii) in the industries in which
      the Business operates in general, to the extent that such change, effect, event,
      occurrence, state of facts or development does not disproportionately impact
      the
      Business, or (iii) resulting from any divestiture that may be required to be
      effected pursuant to the terms of this Agreement, or (b) any failure, in and
      of
      itself, by the Business to meet any internal or published projections, forecasts
      or revenue or earnings predictions (it being understood that the facts or
      occurrences giving rise or contributing to such failure may be deemed to
      constitute, or be taken into account in determining whether there has been
      or
      would reasonably be expected to be, a Material Adverse Effect).

     

    “Merger”
means
      the merger pursuant to the Merger Agreement.

     

    “Note”
means
      the Promissory Note to be executed by BCS International Holding, Limited, as
      Borrower (as defined in the Note), Boston Scientific as guarantor, and Abbott
      at
      the Closing, in the form of Exhibit G.

     

    “Owned
      Business Real Property”
means
      all the Real Property in which Guidant, any Asset Seller or Transferred
      Subsidiary has fee title (or equivalent) interest described on Schedule 1.01(c)
      that are acquired, directly or indirectly, by the Purchasers by the way of
      a
      Share purchase or as a Purchased Asset pursuant to the transactions contemplated
      by this Agreement. 

     

    “Permitted
      Encumbrances”
means
      liens, charges and Encumbrances for current Taxes not yet due and payable.
      

     

    “Person”
means
      any individual, partnership, firm, corporation, limited liability company,
      association, trust, unincorporated organization, joint venture or other
      entity.

     

    “Pre-Closing
      Tax Period”
means
      any taxable period (or portion thereof) ending on or prior to the Closing,
      including such portion of any Straddle Period up to and including the date
      of
      Closing.

     

    “Principal
      Indebtedness”
means
      the amounts owing in respect of the Credit Agreement and any Public
      Indebtedness.

     

    “Post-Closing
      Tax Period”
means
      any taxable period (or portion thereof) commencing after the Closing, including
      such portion of any Straddle Period commencing after the Closing.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Public
      Indebtedness”
means
      Indebtedness of Boston Scientific or any of its Affiliates issued in a public
      offering.

     

    “Purchasers”
means,
      individually or collectively, Abbott, the Asset Purchasers and the Share
      Purchasers.

     

    “Real
      Property”
means
      all land, buildings and other structures, facilities or improvements located
      thereon and all easements, licenses, rights and appurtenances relating to the
      foregoing.

     

    “Registrations”
means
      authorizations and/or approvals issued by any Governmental Authority (including
      premarket approval applications, premarket notifications, investigational device
      exemptions, manufacturing approvals or authorizations, CE Marks, pricing and
      reimbursement approvals, labeling approvals or their foreign equivalent) held
      by
      Guidant or its Affiliates as of the Closing, that are required for the
      manufacture, distribution, marketing, storage, transportation, use and sale
      of
      the products of the Business.

     

    “Regulations”
means
      the Treasury Regulations (including temporary regulations) promulgated by the
      United States Department of Treasury with respect to the Code or other federal
      Tax statutes.

     

    “Release”
means
      the Release to be executed by Abbott and Boston Scientific at the Closing,
      in
      the form of Exhibit H.

     

    “SEC”
means
      the United States Securities and Exchange Commission.

     

    “Sellers”
means,
      individually or collectively, the Asset Sellers and the Share
      Sellers.

     

    “Share
      Purchasers”
means,
      individually or collectively, Abbott and the Affiliates of Abbott that are
      identified on Schedule 1.01(d) attached hereto. 

     

    “Share
      Sellers”
means,
      individually or collectively, the Affiliates of Guidant that are identified
      on
      Schedule 1.01(d) attached hereto.

     

    “Shares”
means
      all the issued and outstanding shares of capital stock and other equity
      interests of the Transferred Subsidiaries. 

     

    “Straddle
      Period”
means
      any taxable period beginning on or before the date of the Closing and ending
      after the date of the Closing.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Supply
      Agreements”
means
      the interim Supply Agreements for DES Stents (as defined in the Supply
      Agreements) and components thereof, dated as of _______, 2006, between Boston
      Scientific or certain of its Affiliates and Abbott or certain of its Affiliates,
      in the form of Exhibit I.

     

    “Tax”
or
      “Taxes”
means
      any and all taxes, levies, duties, tariffs and similar charges in the nature
      of
      a tax (together with any and all interest, penalties, additions to tax and
      additional amounts imposed with respect thereto) imposed by any Governmental
      Authority or taxing authority, including taxes on or with respect to income,
      franchises, windfall or other profits, gross receipts, property, sales, use,
      share capital, capital stock, payroll, employment, social security, workers’
compensation, unemployment compensation, or net worth; taxes in the nature
      of
      excise, withholding, ad valorem, stamp, transfer, value added, or gains taxes;
      license, registration and documentation fees; and customs’ duties, and
      tariffs.

     

    “Tax
      Returns”
means
      any report, return, document, declaration or other information or filing
      required to be filed with a Governmental Authority or taxing authority with
      respect to Taxes (whether or not a payment is required to be made with respect
      to such filing), including information returns, any documents with respect
      to or
      accompanying payments of estimated Taxes, or with respect to or accompanying
      requests for the extension of time in which to file any such report, return,
      document, declaration or other information.

     

    “Trademarks”
means
      trademarks, service marks, trade dress, logos, trade names, corporate names,
      domain names and other source identifiers and all goodwill associated with
      any
      of the foregoing, registrations and applications for registration thereof,
      including all extensions, modifications and renewals of same.

     

    “Transaction
      Agreement”
means
      the Transaction Agreement dated as of January 8, 2006, as amended, between
      Boston Scientific and Abbott.

     

    “Transfer
      Agreements”
means
      (a) with respect to the Purchased Assets and Assumed Liabilities, the Bills
      of
      Sale, the Assumption Agreements, the Business Transfer Agreements, the
      Intellectual Property Transfer Agreements, and such deeds, endorsements,
      assignments, instruments of assumption, affidavits and other instruments of
      sale, conveyance, transfer and assignment for the Asset Sellers, in form and
      substance reasonably satisfactory to Abbott and Guidant, as shall be necessary
      under Law in order to transfer all right, title and interest of the applicable
      Asset Sellers in, to and under such Purchased Assets and Assumed Liabilities
      in
      accordance with the terms hereof, and (b) with respect to the Shares, such
      instruments of sale, conveyance, transfer and assignment, and such other
      agreements or documents, if any, in each case in form and substance reasonably
      satisfactory to Abbott and Guidant, as shall be necessary under Law in order
      to
      transfer all right, title and interest of the applicable Share Seller in the
      Shares in accordance with the terms hereof.

     

    “Transferred
      Subsidiary”
means,
      individually or collectively, the Affiliates of Guidant set forth on Schedule
      1.01(d) and acquired, directly or indirectly, by way of a Share purchase
      pursuant to this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Transition
      Services Agreement”
means
      the Transition Services Agreement dated as of April 21, 2006, between Boston
      Scientific and certain of its Affiliates and Abbott and certain of its
      Affiliates, in the form of Exhibit J.

     

    SECTION
      1.02.   Definitions

     

    .
      The
      following terms have the meanings set forth in the Sections set forth
      below:

     

    
      	
              Definition

            	
              Location

            
	 	 
	
              “Abbott”

            	
              Preamble

            
	
              “Abbott
                Indemnified Parties”

            	
              10.02(a)

            
	
              “Agreement”

            	
              Preamble

            
	
              “Assumed
                Liabilities”

            	
              2.03(a)

            
	
              “Boston
                Scientific”

            	
              Recitals

            
	
              “Business”

            	
              Recitals

            
	
              “Closing”

            	
              2.06

            
	
              “Commonly
                Controlled Entity”

            	
              3.12(a)

            
	
              “Company
                Restricted Stock”
                

            	
              3.12(k)

            
	
              “Company
                Stock Based Awards”
                

            	
              3.12(k)

            
	
              “Company
                Stock Options”
                

            	
              3.12(k)

            
	
              “Company
                Stock Plans”
                

            	
              3.12(k)

            
	
              “Confidentiality
                Agreement”

            	
              5.02(b)

            
	
              “Conveyance
                Taxes”

            	
              7.06

            
	
              “Country
                Allocation”

            	
              2.04(b)

            
	
              “Country
                Allocation Accounting Firm”

            	
              2.04(b)

            
	
              “Deferred
                Local Closing”

            	
              2.06

            
	
              “ERISA”

            	
              3.08

            
	
              “ESSP”

            	
              3.12(k)

            
	
              “Estimated
                Country Allocation”

            	
              2.04(b)

            
	
              “EU
                Merger Regulation”

            	
              3.05

            
	
              “EVT”

            	
              2.02(c)(v)

            
	
              “Excluded
                Assets”

            	
              2.02(c)

            
	
              “Excluded
                Businesses”

            	
              2.02(c)(v)

            
	
              “Excluded
                Liabilities”

            	
              2.03(b)

            
	
              “FDCA”

            	
              3.08

            
	
              “Guarantee
                of Performance”
                

            	
              Recitals

            
	
              “Guidant”

            	
              Preamble

            
	
              “Guidant
                Benefit Agreements”

            	
              3.06

            
	
              “Guidant
                Benefit Plans”

            	
              3.13(a)

            
	
              “Guidant
                CIC Plans”

            	
              6.03(c)

            
	
              “Guidant
                Licensed Marks”

            	
              5.08(c)

            
	
              “In-Country
                Allocation”

            	
              2.04(b)

            
	
              “Initial
                Purchase Price”

            	
              2.04(a)

            
	
              “Intellectual
                Property Rights”

            	
              3.10(a)

            
	
              “IP
                Purchaser”
                

            	
              2.02(e)

            
	
              “IP
                Seller”
                

            	
              2.02(e)

            
	
              “Key
                Personnel”

            	
              3.06

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

       

    

    
      	
              Definition 

            	
              Location 

            
	 	 
	
              “Licensed
                Marks”

            	
              5.08(c)

            
	
              “Loss”

            	
              10.02(a)

            
	
              “Materials”

            	
              5.08(c)(ii)

            
	
              “Medical
                Device”

            	
              3.15(a)

            
	
              “Merger
                Agreement”

            	
              Recitals

            
	
              “Milestone
                Payment”

            	
              2.05

            
	
              “Mixed
                Account”

            	
              5.10(b)

            
	
              “Mixed
                Action”

            	
              5.15(a)

            
	
              “Mixed
                Contract”

            	
              5.10(a)

            
	
              “Non-Guidant
                Licensed Marks”

            	
              5.08(b)

            
	
              “Non-U.S.
                Business Employee”

            	
              6.01(b)

            
	
              “Non-U.S.
                Transferred Employee”

            	
              6.01(b)

            
	
              “Occurrence
                Based Policy”

            	
              5.07(d)

            
	
              “Permits”

            	
              3.08

            
	
              “Purchased
                Assets”

            	
              2.02(a)

            
	
              “Purchase
                Price”

            	
              2.04(a)

            
	
              “Required
                Consent Jurisdictions”

            	
              2.06

            
	
              “Settle”

            	
              5.15(c)

            
	
              “Shared
                Asset”

            	
              2.02(c)(iii)

            
	
              “Social
                Security Act”

            	
              3.15(f)

            
	
              “Sub”

            	
              Recitals

            
	
              “Third
                Party Claim”

            	
              10.05(b)

            
	
              “Tier
                I Employee”

            	
              3.06

            
	
              “Tier
                II Employee”

            	
              3.06

            
	
              “Transferred
                Employees”

            	
              6.01(b)

            
	
              “Transferred
                Subsidiary Tax Attributes”
                

            	
              5.06(d)

            
	
              “U.S.
                Business Employee”

            	
              6.01(a)

            
	
              “U.S.
                Transferred Employee”

            	
              6.01(a)

            


    

    


     

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ARTICLE
      II

     

    PURCHASE
      AND SALE

     

    SECTION
      2.01.   Purchase
      and Sale of the Shares.
      Upon
      the terms and subject to the conditions of this Agreement, at the Closing,
      Guidant shall, or shall cause the applicable Share Seller set forth on Schedule
      1.01(d) to, sell, convey, assign and transfer to the applicable Share Purchaser
      set forth on Schedule 1.01(d) the Shares of the Transferred Subsidiaries set
      forth on Schedule 1.01(d), and the applicable Share Purchaser shall purchase
      all
      of Guidant’s or such Share Seller’s right, title and interest in and to such
      Shares, free and clear of all Encumbrances. Prior to the Closing, the Excluded
      Assets and any employees who are not Transferred Employees shall be transferred
      by the Transferred Subsidiaries to Guidant, Boston Scientific or one of their
      respective Affiliates, and the Excluded Liabilities of the Transferred
      Subsidiaries shall be assumed by Guidant, Boston Scientific or one of their
      respective Affiliates, each in the manner described in Schedule 5.12.


     

    SECTION
      2.02.   Purchase
      and Sale of Assets.
      (a)
      Upon the
      terms and subject to the conditions of this Agreement, at the Closing, Guidant
      shall sell, convey, assign and transfer, and shall cause each Asset Seller
      set
      forth on Schedule 1.01(a) to sell, convey, assign and transfer, to the
      applicable Asset Purchaser set forth on Schedule 1.01(a) all the assets, rights,
      properties and businesses of Guidant and its Affiliates, of every kind and
      description and wherever located, whether tangible or intangible, real, personal
      or mixed, that (except as otherwise expressly set forth in this Agreement or
      the
      Ancillary Agreements) are used primarily in, or related primarily to (with
      “primarily” being determined by taking into account revenues, assets, personnel,
      registrations and other relevant factors), the Business (the “Purchased
      Assets”),
      and
      the applicable Purchaser shall purchase the Purchased Assets, including the
      following:

     

    (i)  that
      portion of the Owned Business Real Property located at Clonmel, Ireland
      described on Schedule 2.02(a)(i);

     

    (ii)  the
      Leased Business Real Property listed on Schedule 2.02(a)(ii);

     

    (iii)  all
      tangible personal property, including machinery, equipment, training materials
      and equipment, mechanical and spare parts, supplies, owned and leased motor
      vehicles, mobile telephones, PC equipment, PDA bar code readers, fixtures,
      trade
      fixtures, tools, tooling, dyes, cap and component molds, stores, furniture,
      furnishings, office equipment and supplies, production supplies, other
      miscellaneous supplies and other tangible property of any kind, in each case
      in
      accordance with the guidelines set forth on Schedule 2.02(a)(iii);

     

    (iv)  the
      benefit and use of any Shared Asset pursuant to this Agreement, the Transition
      Services Agreement, the License and Technology Transfer Agreement, or a lease
      or
      similar arrangement entered into by the parties or their respective
      Affiliates;

     

    (v)  the
      Business Intellectual Property;

     

    (vi)  the
      Registrations supported by and including: (A) the original documents under
      the
      possession of Guidant or the Asset Sellers (or that are accessible to Guidant
      or


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    the
      Asset
      Sellers using commercially reasonable efforts) evidencing the Registrations
      issued to Guidant or the Asset Sellers by a Governmental Authority, in each
      case
      to the extent assignable with or without the consent of the issuing Governmental
      Authority; and (B) all
      related Registration applications, clinical research and trial agreements,
      data
      results and records of clinical trials and marketing research, design history
      files, technical files, drawings, manufacturing, packaging and labeling
      specifications, validation documentation, packaging specifications, quality
      control standards and other documentation, research tools, laboratory notebooks,
      files and correspondence with regulatory agencies and quality reports and all
      relevant pricing information and correspondence with Governmental Authorities
      with respect to such pricing matters;

     

    (vii)  all
      advertising, marketing and promotional materials and all other printed or
      written materials, including website content and the design of such websites
      protected by applicable Law, in each case to the extent used primarily in,
      or
      related primarily to, the Business; 

     

    (viii)  subject
      to Section 5.10 and except as set forth in Sections 2.02(c) and 2.03(b), any
      Contract related to the Business;

     

    (ix)  subject
      to Section 5.10 and except for intercompany receivables
      between
      Guidant and any of its Affiliates, or between any Affiliate of Guidant and
      any
      other Affiliate of Guidant, all accounts, notes and other
      receivables resulting
      from sales by Guidant or its Affiliates of products to the extent generated
      by,
      or related to, the Business, whether current or noncurrent, including all file
      documentation related to such accounts, notes and other receivables, including
      invoices, shipping documents, communications and correspondence submitted to
      or
      received from customers related to such sales;

     

    (x)  all
      inventories, including raw materials, works in process, semi-finished and
      finished products, stores, replacement and spare parts, packaging materials,
      operating supplies
      and
      inventory on consignment, in transit or deposited in a warehouse, in each case
      to the extent used in, or related to, the Business;

     

    (xi)  all
      prepayments, security deposits, refunds (other than refunds described in Section
      2.02(c)(viii)) and prepaid expenses,
      in each
      case to the extent used primarily in, or related primarily to, the
      Business;

     

    (xii)  all
      claims, causes of action, choses in action, rights of recovery and rights of
      set-off of any kind (including all
      damages and payments for past, present or future infringement or
      misappropriation of Business Intellectual Property, the right to use and recover
      for past infringements or misappropriations of Business Intellectual Property,
      and any and all corresponding rights that have been, now or hereafter may be
      secured throughout the world with respect to any Business Intellectual
      Property),
      except
      to
      the extent any of the foregoing relate to (x)
      Excluded Assets or Excluded Liabilities or (y) intercompany receivables between
      Guidant
      and any of its Affiliates, or between any Affiliate of Guidant and any other
      Affiliate of Guidant; 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (xiii)  all
      income, royalties and payments receivable in respect of any Business
      Intellectual Property; 

     

    (xiv)  all
      Books, Records and Files (other than income and similar Tax Returns and related
      books, records and files), to the extent used in, or related to, the Business;
      

     

    (xv)  all
      permits, licenses, certifications and approvals from all permitting, licensing,
      accrediting and certifying agencies, and the rights to all data and records
      held
      by such permitting, licensing and certifying agencies, in each case to the
      extent transferable and used in, or related to, the Business, in each case
      in
      accordance with the guidelines set forth in Schedule 2.02(a)(xv); 

     

    (xvi)  all
      computer software data and information, and all related hardware, in
      each
      case in accordance with the guidelines set forth in Schedule
      2.02(a)(xvi);

     

    (xvii)  subject
      to Section 5.07, all claims under insurance policies and claims or benefits
      in,
      to or under any express or implied warranties from suppliers of goods
      or
      services
      relating to inventory sold or delivered to
      Guidant
      or any Asset Seller prior to the Closing, in each case to the extent related
      to
      the Business; 

     

    (xviii)  copies
      of
      any Tax Returns to the extent related primarily to the Assets, the Transferred
      Subsidiaries or the Business; 

     

    (xix)  all
      goodwill of the Business as a going concern; 

     

    (xx)  all
      rights of Abbott and its Affiliates arising under this Agreement or from the
      consummation of the transactions contemplated hereby; and

     

    (xxi)  the
      assets described on Schedule 2.02(a)(xxi).

     

    (b)  Guidant
      may redact any information related to the Excluded Businesses from any Books,
      Records and Files and similar materials conveyed pursuant to Section 2.02(a);
      provided,
      however,
      that
      such redaction shall not impair any information related to the Business
      contained in such Books, Records and Files and similar materials.

     

    (c)  Notwithstanding
      anything in Sections 2.01 and 2.02(a) to the contrary, the Purchasers shall
      not
      purchase, and the Assets shall not include, any right, title and interest in
      or
      to any of the following assets (the “Excluded
      Assets”):

     

    (i)  subject
      to Section 2.02(d), all cash and cash equivalents, securities (other than the
      Shares, if any) and negotiable instruments on hand, in lock boxes, in financial
      institutions or elsewhere, including any cash residing in any collateral cash
      account securing any obligation or contingent obligation; 

     

    (ii)  all
      intercompany receivables between Guidant
      and any of its Affiliates, or between any Affiliate of Guidant and any other
      Affiliate of Guidant;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (iii)  except
      as
      otherwise expressly set forth in this Agreement or the Ancillary Agreements,
      the
      ownership right in any property or asset (but expressly excluding all
      Intellectual Property) that is used both in the Business and in any other
      businesses of Guidant; provided,
      however,
      that
      such property or asset is not used primarily in, or related primarily to, the
      Business (a “Shared
      Asset”);

     

    (iv)  the
      Real
      Property listed on Schedule 2.02(c)(iv);

     

    (v)  all
      businesses of Guidant
      and its
      Affiliates not included in the Business, including the cardiac rhythm
      management, endovascular repair and cardiac surgery businesses, the capital
      stock and equity interests of EndoVascular Technologies, Inc., a Delaware
      corporation (“EVT”),
      or
      any subsidiary thereof or any assets of EVT or any subsidiary thereof, and
      including all rights of Guidant, EVT and any other Guidant subsidiary with
      respect to the ANCURE ENDOGRAFT System (collectively, the “Excluded
      Businesses”);
      

     

    (vi)  subject
      to Section 5.08(c), the Licensed Marks; 

     

    (vii)  all
      assets of any employee or independent contractor compensation or benefit plan,
      program or arrangement that is maintained or contributed to by Guidant or any
      of
      its Affiliates (other than a stand-alone plan, program or arrangement that
      is
      sponsored by a Transferred Subsidiary and covers primarily employees of the
      Business) and
      that
      is not transferred to a Purchaser or its Affiliate pursuant to Article VI;
      

     

    (viii)  subject
      to the provisions of Article VII, any right to any refund or credit with respect
      to Taxes relating to any Pre-Closing Tax Period; and

     

    (ix)  all
      rights of Guidant and its Affiliates arising under this Agreement or from the
      consummation of the transactions contemplated hereby.

     

    (d)  Guidant
      shall transfer, or Guidant and Abbott will share, the rights, benefits and
      obligations associated with investments by Guidant or any of its Affiliates
      in
      other Persons (other than Affiliates of Guidant) engaged in the vascular
      interventional or endovascular solutions businesses in the manner described
      on
      Schedule 2.02(d).

     

    (e)  Immediately
      prior to the Closing, specified Assets of the Transferred Subsidiaries may
      be
      transferred pursuant to the Intellectual Property Transfer Agreements by the
      applicable Transferred Subsidiary (each, an “IP
      Seller”)
      to
      certain Asset Purchasers (each, an “IP
      Purchaser”).
      No
      later than five days prior to the Closing, Abbott shall provide Guidant with
      Schedule 2.02(e) which shall set forth the specified Assets to be transferred
      pursuant to this Section 2.02(e), the identity of the IP Purchaser and the
      corresponding IP Seller, and the portion of the Purchase Price to be paid by
      the
      relevant IP Purchaser under each Intellectual Property Transfer Agreement.
      Abbott shall cause each relevant IP Purchaser, and Guidant shall cause each
      relevant IP Seller, to execute the applicable Intellectual Property Transfer
      Agreement immediately prior to the Closing.

     

    (f)  Abbott
      and Guidant hereby covenant that the transactions to be effected immediately
      prior to the Closing and described in Section 2.02(e) shall occur in the
      following 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    sequence:
      (i) first, the transfer to be effected pursuant to the Intellectual Property
      Transfer Agreements, (ii) second, the distribution by the IP Sellers set forth
      on Schedule 2.02(e) to Guidant of the proceeds to be paid by the applicable
      IP
      Purchasers under the Intellectual Property Transfer Agreements, and (iii) third,
      the transfer of the Shares and the Purchased Assets other than the Purchased
      Assets transferred pursuant to Section 2.02(e).

     

    SECTION
      2.03.   Assumption
      and Exclusion of Liabilities.
      (a)
      Upon the
      terms and subject to the conditions and exclusions set forth in this Agreement,
      at the Closing, Abbott shall, or shall cause the applicable Asset Purchaser
      to,
      assume and agree to pay, perform and discharge when due, any and all of the
      Liabilities of Guidant and its Affiliates to the extent relating to or arising
      out of the Business or the Purchased Assets, other than the Excluded Liabilities
      set forth in Section 2.03(b) below (the “Assumed
      Liabilities”).

     

    (b)  After
      the
      Closing, Guidant and/or its Affiliates shall retain (or, if necessary, expressly
      assume), and shall be responsible for paying, performing and discharging when
      due, and none of Abbott, the Purchasers or their Affiliates shall assume (by
      succession, transfer or assignment or otherwise) or have any responsibility
      for,
      any of the following Liabilities (the “Excluded
      Liabilities”):

     

    (i)  all
      Liabilities to the extent relating to or arising out of the Excluded Assets;
      

     

    (ii)  all
      Liabilities to the extent relating to or arising out of assets or businesses
      of
      Guidant or any of its Affiliates that are not included in the Assets or related
      to the Business;

     

    (iii)  all
      Liabilities (1) (A) arising from death or personal injury relating to, resulting
      from, caused by or arising out of, directly or indirectly, the ANCURE ENDOGRAFT
      System used in the treatment of abdominal aortic aneurysms, including any such
      Liabilities for negligence, strict liability, design or manufacturing defect,
      conspiracy, failure to warn, or breach of express or implied warranties of
      merchantability or fitness for any purpose or use, or (B) otherwise relating
      to
      such System, (2) arising from defibrillator product recalls and any related
      litigation, or (3) arising from any Guidant shareholder litigation with respect
      to or arising out of the transactions pursuant hereto or the Amended and
      Restated Agreement and Plan of Merger, dated as of November 14, 2005, among
      Johnson & Johnson, Shelby Merger Sub, Inc. and Guidant or any amendment or
      successor agreement thereof;

     

    (iv)  except
      as
      provided in Section 6.02(f), all Liabilities (including all claims arising
      out
      of any death, accident, disease or injury occurring on or before the Closing,
      whether asserted before or after the Closing) relating to or arising from any
      employee or independent contractor compensation or benefit plan, program or
      arrangement that is maintained or contributed to by Guidant or any of its
      Affiliates (other
      than a stand-alone plan, program or arrangement that is sponsored by a
      Transferred Subsidiary and covers primarily employees of the Business)
and
      that
      is not transferred to a Purchaser or its Affiliate pursuant to Article VI;
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (v)  all
      indebtedness for borrowed money; and

     

    (vi)  all
      intercompany payables and loans between
      Guidant
      and any of its Affiliates, or between any Affiliate of Guidant and any other
      Affiliate of Guidant.

     

    SECTION
      2.04.   Purchase
      Price; Allocation of Purchase Price.
      (a)
      Subject
      to the terms and conditions of this Agreement, at the Closing, Abbott, on behalf
      of itself and the other Purchasers, shall pay to Guidant, on behalf of itself
      and the Sellers (except (i) as required by applicable Law, in which case the
      applicable Asset Purchaser shall pay locally to the applicable Asset Seller,
      (ii) as set forth in Schedule 2.02(e), in which case the applicable IP Purchaser
      shall pay to Guidant on behalf of the applicable IP Seller, or (iii) as set
      forth in Section 2.06 with respect to a Deferred Local Closing), an aggregate
      purchase price for the Purchased Assets and the Shares in an amount in cash
      equal to $4,100,000,000 (the “Initial
      Purchase Price”).
      At
      the Closing, the Purchasers shall assume the Assumed Liabilities. The Initial
      Purchase Price, the Assumed Liabilities and the Milestone Payments are
      collectively referred to herein as the “Purchase
      Price”.
      Except
      as otherwise provided in the parenthetical of Section 2.08(a), the Initial
      Purchase Price shall be paid at the Closing by wire transfer in immediately
      available funds to a bank account designated in writing by Guidant no later
      than
      three Business Days prior to the Closing. Abbott shall make any required
      withholding of Taxes from the Purchase Price and shall pay Guidant the Purchase
      Price net of any such withholding. Abbott shall have no obligation to gross-up,
      indemnify or otherwise compensate Guidant for any withholding Tax due or imposed
      with respect to the Purchase Price. No later than five days prior to the
      Closing, Abbott shall provide Schedule 2.04(a) to Guidant which shall set forth
      the jurisdictions in which Abbott or the other applicable Purchasers intend
      to
      withhold Taxes on payment of the Purchase Price. 

     

    (b)  No
      later
      than five days prior to the Closing, Abbott shall provide Guidant with an
      allocation of the Purchase Price by country based on an estimate of the fair
      market values of the Shares and Purchased Assets (the “Estimated
      Country Allocation”).
      As
      soon as practicable, and in any event not later than five days prior to (i)
      the
      latest date required by applicable Law and (ii) seventy days after the Closing,
      Abbott shall provide for Guidant’s review and comments (A) an allocation of the
      Purchase Price among the Shares and the Purchased Assets by country based on
      the
      fair market values of such Shares and Purchased Assets (the “Country
      Allocation”),
      and
      (B) if required by applicable Law, an allocation by asset category within a
      particular country (the “In-Country
      Allocation”).
      Guidant shall have the right to consent to the Estimated Country Allocation
      and
      the In-Country Allocation, which consent shall not be unreasonably withheld
      or
      delayed. If Guidant and Abbott are unable to reach agreement on the Country
      Allocation within five days following the relevant date provided in Section
      2.04(b)(ii), the Country Allocation shall be determined by an
      internationally-recognized independent accounting firm mutually selected by
      Abbott and Guidant (the “Country
      Allocation Accounting Firm”)
      using
      customary valuation methodologies; provided, however, that the Country
      Allocation Accounting Firm shall make its determination within thirty days
      following the date provided in Section 2.04(b)(ii). The determination made
      by
      the Country Allocation Accounting Firm shall be, absent manifest error, final
      and binding on Guidant, on behalf of itself and the Sellers, and Abbott, on
      behalf of itself and the other Purchasers. The fees and expenses of the Country
      Allocation Accounting Firm shall be shared equally between Guidant and Abbott.
      Guidant, on behalf of itself and the Sellers, and Abbott, on behalf of itself
      and the other Purchasers, shall acknowledge that the Country 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Allocation
      and In-Country Allocation will be done at arm’s length based upon a good faith
      determination of fair market values. 

     

    (c)  Each
      of
      Guidant, Abbott and each of their respective Affiliates shall (i) be bound
      by
      the Country Allocation and the In-Country Allocation for purposes of determining
      any Taxes, and (ii) prepare and file, and cause its Affiliates to prepare and
      file, its Tax Returns on a basis consistent with the Country Allocation and
      the
      In-Country Allocation. None of Guidant, Abbott or their respective Affiliates
      shall take any position inconsistent with the Country Allocation or the
      In-Country Allocation in any Tax Return, in any refund claim, in any litigation,
      or otherwise unless required by final determination by an applicable taxing
      authority. In the event that the Country Allocation or the In-Country Allocation
      is disputed by any taxing authority, the party receiving notice of the dispute
      shall promptly notify the other party hereto, and Abbott and Guidant agree
      to
      use their best efforts to defend such Country Allocation or such In-Country
      Allocation in any audit or similar proceeding. 

     

    SECTION
      2.05.   Milestone
      Payments.
      In
      addition to the Initial Purchase Price, within three Business Days following
      the
      first date of the achievement of the following events, Abbott or any Purchaser
      shall pay to Guidant or, subject to the prior written consent of Abbott (not
      to
      be unreasonably withheld or delayed), its designee the following payments (each,
      a “Milestone
      Payment”)
      by
      wire transfer in immediately available funds to a bank account designated by
      Guidant (or, if notice of such designation is received by Abbott later than
      three Business Days following such first date, the applicable payment shall
      be
      made within three Business Days following receipt of such designation): (a)
      a
      single, one-time payment in cash equal to $250,000,000, upon and subject to
      the
      condition that Abbott or any of its Affiliates or designees has received
      approval from the FDA to market and sell an everolimus eluting stent in the
      United States on or before the tenth anniversary of the Closing, and (b) a
      single, one-time payment in cash equal to $250,000,000, upon and subject to
      the
      condition that Abbott or any of its Affiliates or designees has received
      approval from the Ministry of Health, Labour and Welfare of Japan to market
      and
      sell an everolimus eluting stent in Japan on or before the tenth anniversary
      of
      the Closing; provided, however, that in the event of a failure by Boston
      Scientific or any of its Affiliates to pay any principal or interest when due
      (by operation of Law or otherwise) on the Note or on Principal Indebtedness,
      any
      proceeds Guidant or its designee receives or is entitled to receive with respect
      to the Milestone Payments pursuant to this Section 2.05 will be immediately
      applied upon receipt thereof (or, in the case of any such Milestone Payments
      which shall be due but not have been paid at such time, may be applied by Abbott
      directly), by set-off or recoupment, to prepay any amounts then outstanding
      under the Note. Total Milestone Payments shall not exceed $500,000,000. As
      a
      condition to any sale, assignment or transfer of any of the Milestone Payments
      by Guidant to any Person (other than an Affiliate of Guidant), Guidant shall
      cause any such Person to acknowledge in writing (with a copy of such
      acknowledgement to be delivered to Abbott) its agreement to the provisions
      of
      this Section 2.05. 

     

    SECTION
      2.06.   Closing.
      Subject
      to the terms and conditions of this Agreement, the sale and purchase of the
      Shares and the Purchased Assets and the assumption of the Assumed Liabilities
      contemplated by this Agreement shall take place at a closing (the “Closing”)
      to be
      held immediately prior to the consummation of the Merger at the offices of
      Shearman & Sterling LLP, 599 Lexington Avenue, New York, New York at 10:00
      a.m., New York time, on the 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    second
      Business Day following the satisfaction or waiver of the conditions to the
      obligations of the parties hereto set forth in Article VIII, or at such other
      place or at such other time or on such other date as Guidant and Abbott may
      mutually agree upon in writing; provided,
      however,
      that if
      the approvals described on Schedule 2.06 required in one or more of the
      jurisdictions listed on Schedule 2.06 (“Required
      Consent Jurisdictions”)
      have
      not been obtained at the time of the Closing, then the parties shall defer
      the
      Closing solely with respect to the Shares or Purchased Assets related to such
      Required Consent Jurisdictions as described on Schedule 2.06 (each, a
“Deferred
      Local Closing”).
      In
      such event, (a) the legal interest in and to the relevant Shares or Purchased
      Assets shall not be assigned, transferred or conveyed to the applicable
      Purchaser unless and until the Deferred Local Closing occurs, (b) to the extent
      permitted under applicable Law, the applicable Purchaser shall acquire a
      beneficial interest in and to the relevant Shares or Purchased Assets at the
      Closing (including all cash and cash equivalents generated with respect
      thereto), (c) until the Deferred Local Closing occurs, Guidant and its
      Affiliates shall conduct the Business in the Required Consent Jurisdictions
      for
      the benefit and at the expense of Abbott, and (d) Guidant and its Affiliates
      shall not integrate the Excluded Assets in the Required Consent Jurisdictions
      with the businesses of Boston Scientific or its Affiliates until such time
      as
      the Deferred Local Closing has occurred. The Deferred Local Closing shall occur
      no later than three Business Days following receipt of the necessary consents
      and the expiration of all mandatory waiting periods, or at such time as the
      parties may mutually agree upon in writing. At Guidant’s election, Abbott or the
      applicable Purchaser shall either (i) deliver, on the date of the Closing,
      the
      portion of the Initial Purchase Price allocated to the Shares and the Purchased
      Assets related to each Deferred Local Closing pursuant to Section 2.04(b) to
      a
      third-party trust account maintained by an escrow agent (to be mutually agreed
      by Abbott and Guidant prior to the Closing), which portions shall be released
      to
      Guidant or the applicable Seller on the date of the applicable Deferred Local
      Closing, or (ii) pay to Guidant or the applicable Seller the portion of the
      Initial Purchase Price allocated to the Shares and the Purchased Assets related
      to each Deferred Local Closing pursuant to Section 2.04(b) on the date of such
      Deferred Local Closing. Guidant shall notify Abbott in writing of its election
      at least 10 days prior to the Closing. Solely with respect to each Deferred
      Local Closing, the conditions set forth in each of Sections 8.01(b) and (c)
      and
      8.02(b) and (c) must be satisfied at or prior to such Deferred Local Closing
      instead of the Closing.

     

    SECTION
      2.07.   Closing
      Deliveries by Guidant.
      At the
      Closing, Guidant shall deliver, or cause to be delivered, to the applicable
      Purchaser:

     

    (a)  other
      than with respect to uncertificated Shares (with respect to which such notarial
      deeds or other instruments of transfer duly executed by the applicable Share
      Seller will be delivered as required under applicable Law to give effect to
      the
      transfer of such uncertificated Shares), stock certificates evidencing the
      Shares duly endorsed in blank, or accompanied by stock powers duly executed
      in
      blank and with all required stock transfer Tax stamps affixed, in all cases
      free
      and clear of any Encumbrances;

     

    (b)  copies
      of
      the resolutions (or local equivalent) of the board of directors (or local
      equivalent) and, where required, the stockholders of each Seller, authorizing
      and approving the transactions contemplated by this Agreement and the applicable
      Ancillary Agreements, to the extent applicable to such Seller, certified by
      the
      respective corporate 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    secretary
      (or local equivalent) or a director to be true and complete and in full force
      and effect and unmodified as of the Closing;

     

    (c)  executed
      counterparts of each Ancillary Agreement to which Guidant or the applicable
      Seller is a party and such other instruments, in form and substance reasonably
      satisfactory to Abbott, as may be reasonably requested by Abbott or necessary
      under applicable Law to effect the transfer of the Purchased Assets and the
      Shares to the Purchasers and to evidence such transfer in the public records,
      in
      each case duly executed by Guidant or the applicable Seller; 

     

    (d)  a
      receipt
      for the Initial Purchase Price; and

     

    (e)  the
      certificate required by Section 8.02(a).

     

    SECTION
      2.08.   Closing
      Deliveries by Abbott.
      At the
      Closing, Abbott shall deliver, or cause to be delivered, to Guidant or the
      Applicable Seller:

     

    (a)  the
      Initial Purchase Price, by wire transfer in immediately available funds to
      an
      account or accounts designated in writing by Guidant not fewer than three
      Business Days prior to the Closing (except as otherwise may be required by
      applicable Law, in which case the portion of the Initial Purchase Price that
      must be paid locally to the applicable Asset Seller shall be paid by wire
      transfer in immediately available funds (in the local currency, if required
      by
      applicable Law) to a local bank account of such Asset Seller designated in
      writing by Guidant no fewer than three Business Days prior to the Closing);
      

     

    (b)  copies
      of
      the resolutions (or local equivalent) of the board of directors (or local
      equivalent) and, where required, the stockholders of each Purchaser, authorizing
      and approving the transactions contemplated by this Agreement and the applicable
      Ancillary Agreements to the extent applicable to such Purchaser, certified
      by
      the respective corporate secretary (or local equivalent) or a director to be
      true and complete and in full force and effect and unmodified as of the
      Closing;

     

    (c)  executed
      counterparts of each Ancillary Agreement to which Abbott or the applicable
      Purchaser is a party and such other instruments, in form and substance
      reasonably satisfactory to Guidant, as may be reasonably requested by Guidant
      or
      necessary under applicable Law to effect the assumption by Abbott and/or the
      Purchasers of the Assumed Liabilities and to evidence such assumption in the
      public records; and

     

    (d)  the
      certificate required by Section 8.01(a).

     

    ARTICLE
      III


     

    REPRESENTATIONS
      AND WARRANTIES

    OF
      GUIDANT

     

    Guidant
      hereby represents and warrants to Abbott as follows:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SECTION
      3.01.   Organization,
      Authority and Qualification.
      (a)
      Guidant
      is a corporation duly incorporated, validly existing and in good standing under
      the Laws of the State of Indiana and has all necessary corporate power and
      authority to enter into, execute and deliver this Agreement, to carry out its
      obligations hereunder and to consummate the transactions contemplated by this
      Agreement and the Ancillary Agreements to which it is a party. The execution
      and
      delivery by Guidant of this Agreement and the Ancillary Agreements to which
      it
      is a party, the performance by Guidant of its obligations hereunder and
      thereunder and the consummation by Guidant of the transactions contemplated
      hereby and thereby have been duly authorized by all requisite corporate action
      on the part of Guidant. This Agreement has been, and upon their execution each
      of the Ancillary Agreements to which Guidant is a party will be, duly executed
      and delivered by Guidant, and, assuming due authorization, execution and
      delivery by each of the other parties hereto and thereto, this Agreement is,
      and
      each of the Ancillary Agreements to which Guidant is a party will be, a legal,
      valid and binding obligation of Guidant, enforceable against it in accordance
      with its terms.

     

    (b)  Each
      Seller has been duly organized, is a validly existing legal entity and, where
      applicable, is in good standing (or its local equivalent) under the Laws of
      the
      jurisdiction of its organization, and will have when executed as provided in
      this Agreement all necessary corporate power and authority to enter into,
      execute and deliver each Ancillary Agreement to which it is a party, to carry
      out its obligations thereunder and to consummate the transactions contemplated
      thereby. The execution and delivery by each Seller of each Ancillary Agreement
      to which it is a party, the performance by such Seller of its obligations
      thereunder and the consummation by such Seller of the transactions contemplated
      thereby will be, when executed as provided in this Agreement, duly authorized
      by
      all requisite corporate action on the part of such Seller. Each Ancillary
      Agreement to which a Seller is a party will be, when executed as provided in
      this Agreement, duly executed and delivered by such Seller and, assuming due
      authorization, execution and delivery by the other parties thereto, will
      constitute, when executed as provided in this Agreement, a legal, valid and
      binding obligation of such Seller enforceable against it in accordance with
      its
      terms. 

     

    SECTION
      3.02.   Organization,
      Authority and Qualification of the Transferred Subsidiaries.
      Each
      Transferred Subsidiary is a company duly organized, validly existing under
      the
      laws of the jurisdiction of its incorporation and has all necessary corporate
      power and authority to own, operate or lease the properties and assets now
      owned, operated or leased by it and to carry on the Business as it has been
      and
      is currently conducted. Each Transferred Subsidiary is duly licensed or
      qualified to do business and is in good standing (or its local equivalent)
      in
      each jurisdiction in which the properties owned or leased by it or the operation
      of its business makes such licensing or qualification necessary or desirable,
      except to the extent that the failure to be so licensed, qualified or in good
      standing individually or in the aggregate has not had and would not reasonably
      be expected to have a Material Adverse Effect. True and correct copies of the
      certificate of incorporation and bylaws (or similar organizational documents)
      of
      each Transferred Subsidiary have been delivered by Guidant to
      Abbott.

     

    SECTION
      3.03.   Capitalization;
      Ownership of Shares.
      (a)
      Section 3.03(a) of the Disclosure Schedule sets forth a list of each
      Transferred Subsidiary, and sets forth, for each Transferred Subsidiary, the
      name, type of entity, jurisdiction and date of its incorporation or
      organization, its authorized capital stock, the number and type of its issued
      and outstanding 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    shares
      of
      capital stock or similar ownership interests of each Transferred Subsidiary
      and
      all of the Persons owning all the issued and outstanding shares of capital
      stock
      or similar ownership interests of each Transferred Subsidiary. All the issued
      and outstanding shares of capital stock or similar ownership interests of each
      Transferred Subsidiary have been validly issued and are fully paid and
      nonassessable and are owned, directly or indirectly, by Guidant, the applicable
      Share Seller or by a Transferred Subsidiary free and clear of all Encumbrances
      and free of any restriction on the right to vote, sell or otherwise dispose
      of
      such issued and outstanding shares of capital stock or similar ownership
      interests of each Transferred Subsidiary. Except as set forth in Section 3.03(a)
      of the Disclosure Schedule and except for this Agreement, there are no options,
      warrants, calls, subscriptions, convertible securities or other rights,
      securities, agreements, arrangements or commitments relating to the issued
      and
      outstanding shares of capital stock or similar ownership interests of each
      Transferred Subsidiary or obligating Guidant or its Affiliates to issue,
      transfer or sell, or cause to be issued, transferred or sold, any shares of
      capital stock or similar ownership interests of any Transferred Subsidiary,
      or
      grant, extend or enter into any such agreement, arrangement or commitment.
      The
      Shares constitute all the issued and outstanding capital stock of the
      Transferred Subsidiaries. There are no outstanding contractual obligations
      of
      Guidant or its Affiliates to repurchase, redeem or otherwise acquire any Shares
      or any other interest in the Transferred Subsidiaries. 

     

    (b) Section
      3.03(b) of the Disclosure Schedule sets forth a true and complete list of each
      investment by Guidant or any of its Affiliates in other Persons (other than
      Affiliates of Guidant) engaged in the vascular interventional or endovascular
      solutions businesses.

     

    SECTION
      3.04.   No
      Conflict.
      Assuming that all consents, approvals, authorizations and other actions
      described in Section 3.05 have been obtained, all filings and notifications
      listed in Section 3.05 of the Disclosure Schedule have been made and any
      applicable waiting period has expired or been terminated, and except as may
      result from any facts or circumstances relating solely to Abbott or the other
      Purchasers, the execution, delivery and performance by Guidant of this
      Agreement, and the execution, delivery and performance by each of Guidant and
      each Seller of the Ancillary Agreements to which it is a party, do not and
      will
      not (a) violate, conflict with or result in the breach of the certificate
      of incorporation or by laws (or similar organizational documents) of Guidant,
      the Sellers or the Transferred Subsidiaries, (b) conflict with or violate any
      Law or Governmental Order applicable to Guidant, the Sellers or the Transferred
      Subsidiaries, as applicable, or their respective properties or other assets,
      or
      (c) except as set forth in Section 3.04(c) of the Disclosure Schedule,
      conflict with, result in any violation or breach of, constitute a default (or
      event which with the giving of notice or lapse of time, or both, would become
      a
      default) under, or give to others any rights of, or result in, termination,
      cancellation or acceleration of any obligation or to the loss of a benefit
      under, or result in the creation of any Encumbrance (other than Permitted
      Encumbrances) in or upon the properties or other assets of the Business or
      any
      Transferred Subsidiary under, any Contract to which Guidant, a Seller or a
      Transferred Subsidiary is a party, or to which any of the respective Purchased
      Assets is subject, except, in the case of clauses (b) and (c), as individually
      or in the aggregate has not had and would not reasonably be expected to (i)
      have
      a Material Adverse Effect, (ii) impair in any material respect the ability
      of
      Guidant or any Seller to perform its obligations under this Agreement, or (iii)
      prevent or materially impede, interfere with, hinder or delay the consummation
      of the transactions contemplated by this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SECTION
      3.05.   Governmental
      Consents and Approvals.
      The
      execution, delivery and performance by Guidant of this Agreement, and the
      execution, delivery and performance by each of Guidant and each Seller of each
      Ancillary Agreement to which it is a party, do not and will not require any
      consent, approval or other order or authorization of, action by or in respect
      of, or registration, declaration or filing with or notification to, any
      Governmental Authority, except (a) the requirements of the applicable Council
      Regulation of the European Union, as amended (the “EU
      Merger Regulation”),
      and,
      to the extent applicable, the requirements of the HSR Act and the antitrust
      Laws
      of any other relevant jurisdiction, (c) where failure to obtain such
      consent, approval, authorization or action, or to make such filing or
      notification, individually or in the aggregate, has not had and would not
      reasonably be expected to have a Material Adverse Effect, or (d) as may be
      necessary as a result of any facts or circumstances relating solely to Abbott
      or
      any of its Affiliates.

     

    SECTION
      3.06.   Conduct
      in the Ordinary Course.
      Except
      for Liabilities incurred in connection with, and actions taken in compliance
      with, this Agreement, since the date of the most recent financial statements
      included in the “Filed Company SEC Documents” (as defined in the Merger
      Agreement), the Business has been conducted only in the ordinary course
      consistent with past practice, and there has not been any Material Adverse
      Effect, and from such date until the date hereof there has not been: (a) any
      declaration, setting aside or payment of any dividend or other distribution
      (whether in cash, stock or property) with respect to any capital stock of any
      Transferred Subsidiary, other than dividends or distributions by a Transferred
      Subsidiary to Guidant or a Share Seller, (b) any purchase, redemption or other
      acquisition by a Transferred Subsidiary of any shares of capital stock or any
      other securities of such Transferred Subsidiary or any options, warrants, calls
      or rights to acquire such shares or other securities, (c) any split, combination
      or reclassification of any capital stock of a Transferred Subsidiary or any
      issuance or the authorization of any issuance of any other securities in respect
      of, in lieu of or in substitution for shares of their respective capital stock,
      (d) (i) any granting by Guidant or any of its Affiliates to any current or
      former (A) director of a Transferred Subsidiary or (B) U.S. Business Employee
      or
      Non-U.S. Business Employee who is treated as a Tier I Employee (a “Tier
      I
      Employee”)
      or
      Tier II Employee (a “Tier
      II Employee”)
      for
      purposes of Guidant’s Change in Control Severance Pay Plan for Select Employees
      (all individuals described in the foregoing clauses (A) and (B) of this clause
      (d)(i), collectively, the “Key
      Personnel”),
      of
      any increase in compensation, bonus or fringe or other benefits, except for
      normal increases in cash compensation (including cash bonuses) in the ordinary
      course of business consistent with past practice or as was required under any
      (y) employment, deferred compensation, consulting, severance, change of control,
      termination or indemnification contract with any Key Personnel or (z) contract
      with any Key Personnel the benefits of which are contingent, or the terms of
      which are materially altered, upon the occurrence of a transaction involving
      Guidant of a nature contemplated by the Merger Agreement (all such contracts
      in
      the foregoing clauses (y) and (z) of this clause (d)(i), collectively,
“Guidant
      Benefit Agreements”)
      or
      Guidant Benefit Plan (as defined in Section 3.12), (ii) any granting by Guidant
      or any of its Affiliates to any Key Personnel of (A) any increase in severance
      or termination pay or (B) any right to receive any severance or termination
      pay
      except for severance or termination pay received in the ordinary course of
      business consistent with past practice or as was required under any Guidant
      Benefit Agreement or Guidant Benefit Plan, (iii) any entry by Guidant or any
      of
      its Affiliates into, or any amendments of, any Guidant Benefit Agreement, (iv)
      the removal or modification of any restrictions in any Guidant Benefit Agreement
      or Guidant Benefit Plan or awards made 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    thereunder,
      except as required to comply with applicable Law or any Guidant Benefit
      Agreement or Guidant Benefit Plan in effect as of the date hereof or (v) the
      adoption, amendment or termination of any Guidant Benefit Plan, other than,
      in
      the cases of clauses (i), (ii), (iii) and (iv), such increases, amendments,
      new
      agreements, removals, modifications or terminations with respect to Tier II
      Employees that (1) do not provide for any increase in compensation or benefits
      for any individual Tier II Employee that is material in relation to such Tier
      II
      Employee’s compensation or benefits prior to such increase and (2) in the
      aggregate do not result in any material increase in compensation, benefits
      or
      other similar expenses of the Business, (e) any damage, destruction or loss,
      whether or not covered by insurance, that individually or in the aggregate
      has
      had or would reasonably be expected to have a Material Adverse Effect, (f)
      any
      change in accounting methods, principles or practices of the Business materially
      affecting its assets, liabilities or businesses, except insofar as may have
      been
      required by a change in GAAP or (g) any material Tax election or any settlement
      or compromise of any material income Tax liability.

     

    SECTION
      3.07.   Litigation.
      Except
      as set forth in Section 3.07 of the Disclosure Schedule, and except with respect
      to Taxes, which are the subject of Section 3.13, there is no Action pending
      or,
      to the Knowledge of Guidant, threatened, against or affecting a Transferred
      Subsidiary, the Business or the Assets that individually or in the aggregate
      has
      had or would reasonably be expected to have a Material Adverse Effect, nor
      is
      there any demand or letter of any Governmental Authority or any Governmental
      Order outstanding against, or, to the Knowledge of Guidant, investigation by
      any
      Governmental Authority involving, a Transferred Subsidiary, the Business or
      the
      Assets that individually or in the aggregate has had or would reasonably be
      expected to have a Material Adverse Effect. As of the date hereof, no Action
      by
      or against Guidant or any of its Affiliates is pending, or to the Knowledge
      of
      Guidant, threatened, that would reasonably be expected to affect the legality,
      validity or enforceability of this Agreement or prevent the consummation of
      the
      transactions contemplated hereby.

     

    SECTION
      3.08.   Compliance
      with Laws.
      Except
      with respect to Environmental Laws, the Employee Retirement Income Security
      Act
      of 1974, as amended (“ERISA”),
      Taxes
      and regulatory compliance, which are the subjects of Sections 3.09, 3.12, 3.13
      and 3.15, respectively, each of the Transferred Subsidiaries and the Business
      is
      in compliance with all Laws and Governmental Orders applicable to it, its
      properties or other assets or its business or operations, except for failures
      to
      be in such compliance that individually or in the aggregate have not had and
      would not reasonably be expected to have a Material Adverse Effect. Each of
      the
      Transferred Subsidiaries and the Business has in effect all approvals,
      authorizations, certificates, filings, franchises, licenses, notices and permits
      of or with all Governmental Authorities (collectively, “Permits”),
      including all Permits under the Federal Food, Drug and Cosmetic Act of 1938,
      as
      amended (including the rules and regulations promulgated thereunder, the
“FDCA”),
      necessary for the Transferred Subsidiaries and the Business to own, lease or
      operate its properties and other assets and to carry on its activities and
      operations as currently conducted, except where the failure to have such Permits
      individually or in the aggregate has not had and would not reasonably be
      expected to have a Material Adverse Effect. Since January 1, 2000, there has
      not
      occurred any default under, or violation of, any such Permit, except for any
      such default or violation that individually or in the aggregate has not had
      and
      would not reasonably be expected to have a Material Adverse Effect. The
      consummation of the transactions contemplated by this Agreement, in and of
      itself, would not cause the revocation or cancellation of any such 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Permit
      that individually or in the aggregate would reasonably be expected to have
      a
      Material Adverse Effect. 

     

    SECTION
      3.09.   Environmental
      Matters.
      Except
      for those matters that individually or in the aggregate have not had and would
      not reasonably be expected to have a Material Adverse Effect: (i) during the
      period of ownership or operation by Guidant and its Affiliates of any of their
      current or former Owned Business Real Property or Leased Business Real Property,
      there have been no Environmental Releases of Hazardous Materials in, on, under
      or affecting any properties that would subject the Business to any Liability
      under any Environmental Law or require any expenditure by the Transferred
      Subsidiaries or the Business for remediation to meet applicable standards
      thereunder; (ii) prior to and after, as applicable, the period of ownership
      or
      operation by Guidant, and its Affiliates of any of their current or former
      Owned
      Business Real Property or Leased Business Real Property, to the Knowledge of
      Guidant, there were no Environmental Releases of Hazardous Materials in, on,
      under or affecting any properties that would subject the Transferred
      Subsidiaries or the Business to any Liability under any Environmental Law or
      require any expenditure by the Transferred Subsidiaries or the Business for
      remediation to meet applicable standards thereunder; (iii) none of the
      Transferred Subsidiaries are subject to any indemnity obligation or other
      contract with any Person relating to obligations or Liabilities under
      Environmental Laws; and (iv) to the Knowledge of Guidant, there are no facts,
      circumstances or conditions that would reasonably be expected to form the basis
      for any investigation, suit, claim, action, proceeding or liability against
      or
      affecting a Transferred Subsidiary or the Business relating to or arising under
      Environmental Laws. 

     

    SECTION
      3.10.   Intellectual
      Property.
      (a)
      Section 3.10(a) of the Disclosure Schedule sets forth, as of the date hereof,
      a
      complete and accurate list (in all material respects) of all patents and
      applications therefor, registered trademarks and applications therefor, domain
      name registrations and copyright registrations (if any) that are included in
      the
      Business Intellectual Property and are material to the conduct of the Business
      as currently conducted. Such Intellectual Property rights required to be listed
      in Section 3.10(a) of the Disclosure Schedule, together with any tradename
      rights, trade secret or know how rights, service mark rights, trademark rights,
      patent rights, Intellectual Property rights in computer programs or software
      or
      other type of Intellectual Property rights, in each case, that are used
      primarily in or related primarily to the Business and that are material to
      the
      conduct of the Business, taken as a whole, as currently conducted, are
      collectively referred to herein as the “Intellectual
      Property Rights”.
      All
      Intellectual Property Rights are either (i) owned by Guidant, a Transferred
      Subsidiary or an Asset Seller free and clear of all Encumbrances (other than
      Permitted Encumbrances) or (ii) licensed to Guidant, a Transferred Subsidiary
      or
      an Asset Seller free and clear (to the Knowledge of Guidant) of all Encumbrances
      (other than Permitted Encumbrances), except where the failure to so own or
      license such Intellectual Property Rights individually or in the aggregate
      has
      not had and would not reasonably be expected to have a Material Adverse Effect.
      There are no claims pending or, to the Knowledge of Guidant, threatened with
      regard to the ownership or, to the Knowledge of Guidant, licensing by Guidant,
      the Transferred Subsidiaries or the Asset Sellers of any Intellectual Property
      Rights which individually or in the aggregate has had or would reasonably be
      expected to have a Material Adverse Effect. Guidant, a Transferred Subsidiary
      or
      an Asset Seller owns, is validly licensed or otherwise has the right to use
      all
      Intellectual Property Rights, except where the failure to own, have a valid
      license or otherwise have rights to use such Intellectual Property Rights
      individually or in the aggregate has 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    not
      had
      and would not reasonably be expected to have a Material Adverse Effect. The
      execution and delivery of this Agreement and the Ancillary Agreements by Guidant
      and its Affiliates (other than the Transferred Subsidiaries) does not, and
      the
      consummation by Guidant of the Closing and the other transactions contemplated
      by this Agreement and the Ancillary Agreements will not, conflict with, or
      result in any violation or breach of, or default (with or without notice or
      lapse of time, or both) under, or give rise to a right of, or result in,
      termination, cancellation or acceleration of any obligation or the loss of
      a
      benefit under, or result in the creation of any Encumbrance in or upon, any
      Intellectual Property Right, in each case that individually or in the aggregate
      has not had or would reasonably be expected to have a Material Adverse Effect.
      Section 3.10(a)(i) of the Disclosure Schedule sets forth, as of the date hereof,
      all contracts under which Guidant, the Transferred Subsidiaries or the Asset
      Sellers is obligated to make payments to third parties for use of any
      Intellectual Property Rights with respect to the commercialization of any
      products that are, as of the date hereof, being sold, manufactured by or under
      development by the Business and for which such payments are in excess of
      $2,000,000 per year for any single product. The aggregate amount of all such
      payments that the Business is obligated to make under any contract of the type
      described in the immediately preceding sentence that are not required to be
      disclosed pursuant to such sentence does not exceed $10,000,000 per
      year.

     

    (b) There
      are
      no pending or, to the Knowledge of Guidant, threatened claims that the operation
      of the Business or any Transferred Subsidiary has infringed or is infringing
      (including with respect to the manufacture, use or sale by the Business or
      the
      Transferred Subsidiaries of any products or to the operations of the Business
      and the Transferred Subsidiaries) any intellectual property rights of any Person
      that individually or in the aggregate have had or would reasonably be expected
      to have a Material Adverse Effect. To the Knowledge of Guidant, as of the date
      of this Agreement, there are no facts, circumstances or conditions that would
      reasonably be expected to form the basis for any claim by a Person to exclude
      or
      prevent the Business from freely using its Intellectual Property Rights and
      that
      individually or in the aggregate would reasonably be expected to have a Material
      Adverse Effect.

     

    (c) All
      patents required to be listed in Section 3.10(a) of the Disclosure Schedule
      that
      are owned by Guidant or its Affiliates have been duly registered and/or filed
      with or issued by each appropriate Governmental Authority, all necessary
      affidavits of continuing use have been timely filed, and all necessary
      maintenance fees have been timely paid to continue all such rights in effect,
      other than failures to be duly registered, filed, issued or paid that
      individually or in the aggregate have not had and would not reasonably be
      expected to have a Material Adverse Effect. None of the patents required to
      be
      listed in Section 3.10(a) of the Disclosure Schedule that are owned by Guidant
      or its Affiliates has expired or been declared invalid, in whole or in part,
      by
      any Governmental Authority, other than such expirations or declarations of
      invalidity that individually or in the aggregate have not had and would not
      reasonably be expected to have a Material Adverse Effect. There are no ongoing
      interferences, oppositions, reissues, reexaminations or other proceedings
      challenging any of the patents or patent applications required to be listed
      in
      Section 3.10(a) of the Disclosure Schedule and owned by Guidant or its
      Affiliates for the benefit of the Business and the Transferred Subsidiaries
      (or,
      to the Knowledge of Guidant, challenging any such patents or patent applications
      licensed to the Business or the Transferred Subsidiaries), including ex parte
      and post-grant proceedings, in the United States Patent and Trademark Office
      or
      in any foreign patent office or similar administrative agency, other than such
      interferences, oppositions, reissues, reexaminations or 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    proceedings
      that individually or in the aggregate have not had and would not reasonably
      be
      expected to have a Material Adverse Effect.

     

    (d) Except
      as
      has not had and would not reasonably be expected to have a Material Adverse
      Effect, Guidant and its Affiliates have used commercially reasonable efforts
      to
      maintain their material trade secrets included in the Business Intellectual
      Property in confidence.

     

    SECTION
      3.11.   Title. 
      Each of
      Guidant and each Asset Seller and Transferred Subsidiary has valid title to,
      or
      valid leasehold or sublease interests or other comparable contract rights in
      or
      relating to, all of its Owned Business Real Property or Leased Business Real
      Property, as applicable, and other tangible Assets necessary for the conduct
      of
      the Business as currently conducted, except as have been disposed of in the
      ordinary course of business and except for defects in title, easements,
      restrictive covenants and similar encumbrances that individually or in the
      aggregate have not had and would not reasonably be expected to have a Material
      Adverse Effect. Each of Guidant and each Asset Seller and Transferred Subsidiary
      has complied with the terms of all leases or subleases relating to Leased
      Business Real Property to which it is a party and under which it is in
      occupancy, and all leases relating to Leased Business Real Property to which
      Guidant or any Asset Seller or Transferred Subsidiary is a party and under
      which
      it is in occupancy are in full force and effect, except for such failure to
      comply or be in full force and effect that individually or in the aggregate
      has
      not had and would not reasonably be expected to have a Material Adverse Effect.
      None of Guidant or any Asset Seller or Transferred Subsidiary has received
      any
      written notice of any event or occurrence that has resulted or could result
      (with or without the giving of notice, the lapse of time or both) in a default
      with respect to any lease or sublease regarding the Leased Business Real
      Property to which it is a party, which defaults individually or in the aggregate
      have had or would reasonably be expected to have a Material Adverse
      Effect.

     

    SECTION
      3.12.   Employee
      Benefit Matters.
      (a)  Section
      3.12(a) of the Disclosure Schedule contains a complete and accurate list, as
      of
      the date hereof, of (i)
      each
      employment, bonus, pension, profit sharing, deferred compensation, incentive
      compensation, stock ownership, stock purchase, stock appreciation, restricted
      stock, stock option, “phantom” stock, performance, retirement, thrift, savings,
      stock bonus, paid time off, perquisite, fringe benefit, vacation, severance,
      disability, death benefit, hospitalization, medical, welfare benefit or other
      plan, program, policy or contract maintained, contributed to or required to
      be
      maintained or contributed to by Guidant or any of the Asset Sellers or
      Transferred Subsidiaries or any other Person that, together with Guidant, is
      treated as a single employer under Section 414(b), (c), (m) or (o) of the Code
      (each, a “Commonly
      Controlled Entity”)
      (exclusive of any such plan, program, policy or contract mandated by and
      maintained solely pursuant to applicable Law), in each case providing benefits
      to any current or former U.S. Business Employee or Non-U.S. Business Employee
      (collectively, but exclusive of individual option and restricted award
      agreements issued under the Company Stock Plans, the “Guidant
      Benefit Plans”)
      and
      (ii) each Guidant Benefit Agreement (exclusive of local offer letters mandated
      under applicable non-U.S. Law that do not impose any severance obligations
      other
      than any mandatory statutory severance). Guidant has caused to be made available
      to Abbott a true and complete copy of (i) each Guidant Benefit Plan or, at
      Guidant’s option, in the case of Guidant Benefit Plans maintained primarily for
      Non-U.S. Business Employees, a summary thereof (or, in either case, with respect
      to any unwritten Guidant Benefit Plans, descriptions thereof) and each Guidant
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Benefit
      Agreement (exclusive of local offer letters mandated under applicable foreign
      Law that do not impose any severance obligations other than mandatory
      severance), (ii) the two most recent annual reports on Form 5500 required to
      be
      filed with the IRS with respect to each Guidant Benefit Plan (if any such report
      was required), (iii) the most recent summary plan description for each Guidant
      Benefit Plan for which such summary plan description is required, and (iv)
      each
      trust and insurance or group annuity contract relating to any Guidant Benefit
      Plan. 

     

    (b)  Each
      Guidant Benefit Plan has been administered in all material respects in
      accordance with its terms and the requirements of all applicable Laws. Each
      of
      Guidant, a Transferred Subsidiary or an Asset Seller, as the case may be, has
      performed all material obligations required to be performed by it under, is
      not
      in any material respect in default under or in material violation of, and
      Guidant has no Knowledge of any material default or violation by any other
      party
      to, any Guidant Benefit Plan. No Action is pending or, to the Knowledge of
      Guidant, threatened with respect to any Guidant Benefit Plan (other than claims
      for benefits in the ordinary course) and, to the Knowledge of Guidant, no fact
      or event exists that could give rise to any such Action. Each of Guidant, the
      Transferred Subsidiaries, the Asset Sellers and all the Guidant Benefit Plans
      are all in compliance in all material respects with the applicable provisions
      of
      ERISA, the Code and all other applicable Laws, including Laws of foreign
      jurisdictions, and the terms of all collective bargaining
      Contracts.

     

    (c)  All
      Guidant Benefit Plans intended to be tax-qualified have received favorable
      determination letters from the IRS with respect to “TRA” (as defined in
      Section 1 of IRS Rev. Proc. 93-39), and have timely filed with the IRS
      determination letter applications (or have received such a determination letter)
      with respect to “GUST” (as defined in Section 1 of IRS Notice 2001-42), to
      the effect that such Guidant Benefit Plans are qualified and exempt from Federal
      income taxes under Sections 401(a) and 501(a), respectively, of the Code,
      no such determination letter has been revoked (nor, to the Knowledge of Guidant,
      has revocation been threatened) and to the Knowledge of Guidant, no event has
      occurred since the date of the most recent determination letter or application
      therefor relating to any such Guidant Benefit Plan that would reasonably be
      expected to adversely affect the qualification of such Guidant Benefit Plan
      or
      materially increase the costs relating thereto or require security under
      Section 307 of ERISA.  Guidant has provided to Abbott a complete and
      accurate copy of the most recent determination letter received prior to the
      date
      hereof with respect to each Guidant Benefit Plan, as well as a complete and
      accurate copy of each pending application for a determination letter, if
      any.  Guidant has also provided to Abbott a complete and accurate list of
      all amendments to any Guidant Benefit Plan as to which a favorable determination
      letter has not yet been received. 

     

    (d)  Except
      as
      set forth on Section 3.12(d) of the Disclosure Schedule, neither Guidant nor
      any
      Commonly Controlled Entity has, during the six-year period ending on the date
      hereof, maintained, contributed to or been required to contribute to any Guidant
      Benefit Plan that is subject to Title IV of ERISA or Section 412 of the
      Code, or any “multiemployer plan” as defined in Section 3(37) or
      4001(a)(3) of ERISA.  Except as has not had and would not reasonably
      be expected to have a Material Adverse Effect, neither Guidant nor any Commonly
      Controlled Entity has any unsatisfied liability under Title IV of ERISA. 
To the Knowledge of Guidant, no condition exists that presents a material risk
      to Guidant, a Transferred Subsidiary or an Asset Seller of incurring a material
      liability under Title IV of ERISA.  The Pension Benefit Guaranty
      Corporation has not instituted proceedings under Section 4042 of ERISA to
      terminate 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    any
      Guidant Benefit Plan and, to the Knowledge of Guidant, no condition exists
      that
      presents a material risk that such proceedings will be instituted.

     

    (e)  Except
      as
      has not had and would not reasonably be expected to have a Material Adverse
      Effect, (i) all reports, returns and similar documents with respect to all
      Guidant Benefit Plans required to be filed with any Governmental Authority
      or
      distributed to any Guidant Benefit Plan participant have been duly and timely
      filed or distributed, (ii) none of Guidant or any of the Transferred
      Subsidiaries has received notice of, and to the Knowledge of Guidant, there
      are
      no investigations by any Governmental Authority with respect to, termination
      proceedings or other claims (except claims for benefits payable in the normal
      operation of the Guidant Benefit Plans), suits or proceedings against or
      involving any Guidant Benefit Plan or asserting any rights or claims to benefits
      under any Guidant Benefit Plan that could reasonably be expected to give rise
      to
      any material liability, and (iii) to the Knowledge of Guidant, there are not
      any
      facts that could give rise to any liability in the event of any such
      investigation, claim, suit or proceeding.

     

    (f)  Except
      as
      has not had and would not reasonably be expected to have a Material Adverse
      Effect, (i) all contributions, premiums and benefit payments under or in
      connection with any Guidant Benefit Plans that are required to have been made
      as
      of the date hereof in accordance with the terms of the Guidant Benefit Plans
      and
      applicable Laws have been timely made or will be made in accordance with
      applicable Law, and (ii) no Guidant Benefit Plan has an “accumulated
      funding deficiency” (as such term is defined in Section 302 of ERISA or
      Section 412 of the Code), whether or not waived.

     

    (g)  With
      respect to each Guidant Benefit Plan, except as has not had and would not
      reasonably be expected to have a Material Adverse Effect, (i) there has not
      occurred any prohibited transaction (within the meaning of Section 406 of
      ERISA or Section 4975 of the Code) in which any Transferred Subsidiary or
      Asset Seller or any U.S. Business Employee or Non-U.S. Business Employee, or,
      to
      the Knowledge of Guidant, any trustee, administrator or other fiduciary of
      such
      Guidant Benefit Plan, or any agent of the foregoing, has engaged that could
      reasonably be expected to subject any Transferred Subsidiary or Asset Seller
      or
      any U.S. Business Employee or Non-U.S. Business Employee, or any such trustee,
      administrator or other fiduciary, to the tax or penalty on prohibited
      transactions imposed by Section 4975 of the Code or the sanctions imposed
      under Title I of ERISA, and (ii) none of the Transferred Subsidiaries,
      Asset Sellers, U.S. Business Employees or Non-U.S. Business Employees or, to
      the
      Knowledge of Guidant, trustees, administrators or other fiduciaries of any
      Guidant Benefit Plan nor any agent of any of the foregoing, has engaged in
      any
      transaction or acted in a manner, or failed to act in a manner, that could
      reasonably be expected to subject any Transferred Subsidiary, Asset Seller
      or
      any U.S. Business Employee or Non-U.S. Business Employee or, to the Knowledge
      of
      Guidant, any such trustee, administrator or other fiduciary, to any liability
      for breach of fiduciary duty under ERISA or any other applicable
      Law.

     

    (h)  Each
      Guidant Benefit Plan that is an “employee welfare benefit plan” (as defined in
      Section 3(1) of ERISA) may be amended or terminated (including with respect
      to
      benefits provided to retirees and other former employees) at any time after
      Closing. Each of Guidant and the Commonly Controlled Entities complies in all
      material respects with the applicable requirements of
      Section 4980B(f) of the Code, Sections 601-609 of ERISA or any


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    similar
      state or local Law with respect to each Guidant Benefit Plan that is a group
      health plan, as such term is defined in Section 5000(b)(1) of the Code
      or such state Law.  None of Guidant, any Transferred Subsidiary or any
      Asset Seller has any material obligations for health or life insurance benefits
      following termination of employment under any Guidant Benefit Plan (other than
      for continuation coverage required under Section 4980(B)(f) of the
      Code). 

     

    (i)  Except
      as
      set forth on Section 3.12(i) of the Disclosure Schedule, none of the execution
      and delivery of this Agreement or the consummation of any transaction
      contemplated by this Agreement (alone or in conjunction with any other event,
      including as a result of any termination of employment on or following the
      Closing) will (i) entitle any current or former U.S. Business Employee or
      Non-U.S. Business Employee to severance or termination pay, (ii) accelerate
      the time of payment or vesting, or trigger any payment or funding (through
      a
      grantor trust or otherwise) of, compensation or benefits under, increase the
      amount payable or trigger any other material obligation pursuant to, any Guidant
      Benefit Plan or Guidant Benefit Agreement, or (iii) result in any breach or
      violation of, or a default under, any Guidant Benefit Plan or Guidant Benefit
      Agreement.

     

    (j)  Neither
      Guidant nor any of the Transferred Subsidiaries or Asset Sellers has any
      material liability or obligations, including under or on account of a Guidant
      Benefit Plan, arising out of the hiring of persons to provide services to the
      Business and treating such persons as consultants or independent contractors
      and
      not as employees of the Business.  No current or former independent
      contractor that provides or provided personal services to the Business (other
      than a current or former director) is entitled to any material fringe or other
      benefits (other than cash consulting fees) pursuant to any plan, program, policy
      or contract to which Guidant, any Transferred Subsidiary or any Asset Seller
      is
      a party or which is maintained, sponsored or contributed to by Guidant, any
      Transferred Subsidiary or any Asset Seller.

     

    (k)  No
      material deduction by a Transferred Subsidiary in respect of any “applicable
      employee remuneration” (within the meaning of Section 162(m) of the Code)
      has been disallowed or is subject to disallowance by reason of
      Section 162(m) of the Code.  For each of the Key Personnel, Guidant
      has previously provided to Abbott (i) accurate Form W-2 information
      for the 1999, 2000, 2001, 2002 and 2003 calendar years, (ii) annual base
      salary as of the date hereof, actual bonus earned for the 2003 calendar year
      and
      target annual bonus for the 2004 calendar year, (iii) a list, as of the
      date hereof, of all outstanding Company Stock Options, Company Restricted Stock
      and Company Stock-Based Awards granted under the Company Stock Plans or
      otherwise (other than rights under the ESPP), together with (as applicable)
      the
      number of shares of Guidant common stock subject thereto, and the grant dates,
      expiration dates, exercise or base prices and vesting schedules
      thereof, (iv) estimated
      current annual cost of welfare benefits, and (v) estimated costs of the
      pension benefit enhancement under Section 8 of Guidant’s Change in Control
      Severance Pay Plan for Select Employees. For purposes of this Section 3.12(k),
      the terms “Company
      Stock Options”,
      “Company
      Restricted Stock”,
      “Company
      Stock-Based Awards”,
      “Company
      Stock Plans”
and
      “ESPP”
shall
      have the meanings ascribed to such terms in Section 3.01(c) of the Merger
      Agreement.

     

    (l)  Except
      as
      provided in accordance with Guidant’s Change in Control Severance Pay Plan for
      Select Employees, no current or former U.S. Business Employee or Non-U.S.
      Business Employee is entitled to receive any additional payment from Guidant
      or
      any 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Transferred
      Subsidiary or Asset Seller by reason of the excise tax required by
      Section 4999(a) of the Code being imposed on such person by reason of
      the transactions contemplated by the Merger Agreement.

     

    (m)  From
      the
      date of the most recent financial statements included in the Filed Company
      SEC
      Documents through the date of this Agreement, there has not been any adoption,
      material amendment or termination by Guidant or any of its Affiliates of any
      collective bargaining or other labor union contract to which Guidant or any
      of
      its Affiliates is a party or by which Guidant or any of its Affiliates is bound
      and affecting the U.S. Business Employees, the Non-U.S. Business Employees
      or
      the Transferred Subsidiaries. As of the date of this Agreement, none of the
      U.S.
      Business Employees are represented by any union with respect to their employment
      by Guidant, a Transferred Subsidiary or an Asset Seller. Except as set forth
      in
      Section 3.12(m) of the Disclosure Schedule, there are no collective bargaining
      agreements or other labor union contracts to which Guidant or any of its
      Subsidiaries is a party or by which Guidant or any of its Subsidiaries is bound.
      Since January 1, 2003, with respect to the Business, none of Guidant, a
      Transferred Subsidiary or an Asset Seller has experienced any material labor
      disputes, union organization attempts or work stoppages, slowdowns or lockouts
      due to labor disagreements.

     

    SECTION
      3.13.   Taxes.
      Except
      as has not had and would not reasonably be expected to have a Material Adverse
      Effect:

     

    (a)  all
      Tax
      Returns required by applicable Law to have been filed with any Governmental
      Authority by, or with respect to, Guidant and its Affiliates (with respect
      to
      the Shares, the Assets or the Business) have been filed in a timely manner
      (taking into account any valid extension) in accordance with all applicable
      Laws, and all such Tax Returns are true and complete in all material
      respects;

     

    (b)  Guidant
      and its Affiliates (with respect to the Shares, the Assets or the Business)
      have
      paid (or have had paid on its behalf) all Taxes due and owing, and the most
      recent financial statements of Guidant filed with the SEC for which Guidant
      and
      its Affiliates are included reflect an adequate accrual for all Taxes payable
      by
      Guidant and its Affiliates (with respect to the Shares, the Assets or the
      Business) for all taxable periods and portions thereof accrued through the
      date
      of such financial statements;

     

    (c)  there
      are
      no Encumbrances for Taxes on any of the Shares or the Assets other than for
      Taxes not yet due and payable;

     

    (d)  Guidant
      and its Affiliates (with respect to the Shares, the Assets or the Business)
      have
      complied with all applicable Laws relating to the payment and withholding of
      Taxes;

     

    (e)  no
      written notification has been received by Guidant and its Affiliates (with
      respect to the Shares, the Assets or the Business) that any federal, state,
      local or foreign audit, examination or similar proceeding is pending, proposed
      or asserted with regard to any Taxes or Tax Returns of Guidant and its
      Affiliates (with respect to the Shares, the Assets or the
      Business);

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (f)  there
      is
      no currently effective Contract extending, or having the effect of extending,
      the period of assessment or collection of any federal, state or, to the
      Knowledge of Guidant, non-United States Taxes by Guidant and its Affiliates
      (with respect to the Shares, the Assets or the Business) nor has any request
      been made for any such extension;

     

    (g)  no
      written notice of a claim or pending investigation has been received from any
      state, local or other jurisdiction with which Guidant and its Affiliates
      currently does not file tax returns, alleging that Guidant or its Affiliate
      (with respect to the Shares, the Assets or the Business) has a duty to file
      tax
      returns and pay taxes or is otherwise subject to the taxing authority of such
      jurisdiction; 

     

    (h)  none
      of
      the Transferred Subsidiaries joins or has joined, for any taxable period during
      the eight years prior to the date of this Agreement, in the filing of any
      affiliated, aggregate, consolidated, combined or unitary federal, state, local
      or, to the Knowledge of Guidant, non-United States Tax Return other than
      consolidated Tax Returns for the consolidated group of which Guidant is the
      common parent;

     

    (i)  none
      of
      Guidant or its Affiliates (with respect to the Shares, the Assets or the
      Business) is a party to or bound by any Tax sharing agreement or Tax indemnity
      agreement, arrangement or practice (including any advance pricing agreement,
      closing agreement or other agreement relating to Taxes with any taxing
      authority);

     

    (j)  none
      of
      the Transferred Subsidiaries has constituted either a “distributing corporation”
or a “controlled corporation” in a distribution of stock qualifying for tax-free
      treatment under Section 355 of the Code in the two years prior to the date
      of
      this Agreement;

     

    (k)  none
      of
      the Transferred Subsidiaries will be required to include in a taxable period
      ending after the Closing taxable income attributable to income that accrued
      in a
      prior taxable period (or portion of a taxable period) but was not recognized
      for
      Tax purposes in any prior taxable period as a result of (i) an open transaction
      disposition made on or before the Closing, (ii) a prepaid amount received on
      or
      prior to the Closing, (iii) the installment method of accounting, (iv) the
      long-term contract method of accounting, (v) the cash method of accounting
      or
      Section 481 of the Code, or (vi) any comparable provisions of state or local
      Tax
      Law, domestic or foreign, or for any other reason, other than any amounts that
      are specifically reflected in a reserve for Taxes on the most recent financial
      statements of Guidant filed with the SEC for which the Transferred Subsidiaries
      are included; and 

     

    (l)  none
      of
      the Transferred Subsidiaries has entered into a “listed transaction” within the
      meaning of Treasury Regulation § 1.6011-4(b)(2).

     

    SECTION
      3.14.   Material
      Contracts.
      (a)  Except
      as set forth in Section 3.14(a)
      of the
      Disclosure Schedule, as of the date hereof, neither Guidant nor any of its
      Affiliates is a party to, and none of the Assets are subject to, any Contract
      related to the Business that is a “material contract” (as such term is defined
      in Item 601(b)(10) of Regulation S-K of the SEC).

     

    (b)  Section
      3.14(b) of the Disclosure Schedule contains a complete and accurate list, as
      of
      the date hereof, of:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (i)  each
      material Contract related to the Business restricting or purporting to restrict
      the ability of Guidant or any Asset Seller or Transferred Subsidiary to compete
      in any line of business, geographic area or customer segment; and 

     

    (ii)  each
      material Contract relating to distribution, sale, supply, licensing,
      co-promotion or manufacturing of any products or services of the Business or
      any
      products licensed by the Business.

     

    (c)  None
      of
      Guidant or any Share Seller, Asset Seller or Transferred Subsidiary or, to
      the
      Knowledge of Guidant, any other party thereto is in violation of or in default
      under (nor does there exist any condition which upon the passage of time or
      the
      giving of notice or both would cause such a violation or default by any of
      Guidant or any of its Affiliates or, to the Knowledge of Guidant, any other
      party thereto under) any Contract relating to the Business to which it is a
      party or by which it or any of its Assets is bound, except for violations or
      defaults that individually or in the aggregate have not had and would not
      reasonably be expected to have a Material Adverse Effect. Neither Guidant nor
      any of its Affiliates has entered into any Contract relating to the Business
      that is currently in effect that is required to be disclosed pursuant to Item
      404 of Regulation S-K of the SEC.

     

    SECTION
      3.15.   Regulatory
      Matters.
      Except
      as set forth in Section 3.15 of the Disclosure Schedule:

     

    (a)  As
      to each product subject to the FDCA or similar Law in any foreign jurisdiction
      that is developed, manufactured, tested, distributed and/or marketed by the
      Business (a “Medical
      Device”),
      each
      such Medical Device is being developed, manufactured, tested, distributed and/or
      marketed in compliance with all applicable requirements under the FDCA and
      similar Laws, including those relating to investigational use, premarket
      clearance or marketing approval to market a Medical Device, good manufacturing
      practices, labeling, advertising, record keeping, filing of reports and
      security, and in compliance with the Advanced Medical Technology Association
      Code of Ethics on Interactions with Healthcare Professionals and the American
      Medical Association’s guidelines on gifts to physicians, except for failures
      that individually or in the aggregate have not had and would not reasonably
      be
      expected to have a Material Adverse Effect. None of Guidant or its Affiliates
      has received any notice or other communication from the FDA or any other
      Governmental Authority (i) contesting the premarket clearance or approval of,
      the uses of or the labeling and promotion of any products of the Business,
      or
      (ii) otherwise alleging any violation applicable to any Medical Device of any
      Law, in the case of (i) and (ii), that individually or in the aggregate have
      not
      had and would reasonably be expected to have a Material Adverse
      Effect.

     

    (b)  No
      Medical Device is under consideration by senior management of Guidant or its
      Affiliates for recall, withdrawal, suspension, seizure or discontinuance, or
      has
      been recalled, withdrawn, suspended, seized or discontinued (other than for
      commercial or other business reasons) by, Guidant, a Transferred Subsidiary
      or
      an Asset Seller in the United States or outside the United States (whether
      voluntarily or otherwise), in each case since January 1, 2002. No proceedings
      in
      the United States or outside of the United States of which Guidant has Knowledge
      (whether completed or pending) seeking the recall, withdrawal, suspension,
      seizure or discontinuance of any Medical Device are pending against Guidant,
      a
      Transferred Subsidiary 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    or
      an
      Asset Seller or any licensee of any Medical Device that individually or in
      the
      aggregate have had or would reasonably be expected to have a Material Adverse
      Effect.

     

    (c)  As
      to
      each Medical Device for which a premarket approval application, premarket
      notification, investigational device exemption or similar state or foreign
      regulatory application has been approved, the Business and the Transferred
      Subsidiaries are in compliance with 21 U.S.C. §§ 360 and 360e or 21 C.F.R. Parts
      812 or 814, respectively, and all similar Laws and all terms and conditions
      of
      such licenses or applications, except for any such failure or failures to be
      in
      compliance that individually or in the aggregate have not had and would not
      reasonably be expected to have a Material Adverse Effect. In addition, with
      respect to the Business and the Transferred Subsidiaries, Guidant and its
      Affiliates are in substantial compliance with all applicable registration and
      listing requirements set forth in 21 U.S.C. § 360 and 21 C.F.R. Part 807 and all
      similar Laws, except for any such failures to be in compliance that individually
      or in the aggregate have not had and would not reasonably be expected to have
      a
      Material Adverse Effect.

     

    (d)  No
      article of any Medical Device is (i) adulterated within the meaning of 21 U.S.C.
      § 351 (or similar Law), (ii) misbranded within the meaning of 21 U.S.C. § 352
      (or similar Law), or (iii) a product that is in violation of 21 U.S.C. § 360 or
§ 360e (or similar Law), except for failures to be in compliance with the
      foregoing that would not reasonably be expected to have a Material Adverse
      Effect.

     

    (e)  With
      respect to the Business and the Transferred Subsidiaries, none of Guidant or
      its
      Affiliates, nor, to the Knowledge of Guidant, any officer, employee or agent
      of
      Guidant or any of its Affiliates, has made an untrue statement of a material
      fact or fraudulent statement to the FDA or any other Governmental Authority,
      failed to disclose a material fact required to be disclosed to the FDA or any
      other Governmental Authority, or committed an act, made a statement, or failed
      to make a statement that, at the time such disclosure was made, could reasonably
      be expected to provide a basis for the FDA or any other Governmental Authority
      to invoke its policy respecting “Fraud, Untrue Statements of Material Facts,
      Bribery, and Illegal Gratuities”, set forth in 56 Fed. Reg. 46191 (September 10,
      1991) or any similar policy.

     

    (f)  With
      respect to the Business and the Transferred Subsidiaries, none of Guidant or
      its
      Affiliates, nor, to the Knowledge of Guidant, any officer, employee or agent
      of
      Guidant or any of its Affiliates, has been convicted of any crime or engaged
      in
      any conduct for which debarment is mandated by 21 U.S.C. § 335a(a) or any
      similar Law or authorized by 21 U.S.C. § 335a(b) or any similar Law. With
      respect to the Business and the Transferred Subsidiaries, none of Guidant or
      its
      Affiliates, nor, to the Knowledge of Guidant, any officer, employee or agent
      of
      Guidant or its Affiliates has been convicted of any crime or engaged in any
      conduct for which such Person or entity could be excluded from participating
      in
      the federal health care programs under Section 1128 of the Social Security
      Act
      of 1935, as amended (the “Social
      Security Act”)
      or any
      similar Law.

     

    (g)  With
      respect to the Business and the Transferred Subsidiaries, since January 1,
      2002,
      none of Guidant or its Affiliates has received any written notice that the
      FDA
      or any other Governmental Authority has (i) commenced, or threatened to
      initiate, any action to withdraw its approval or request the recall of any
      Medical Device, (ii) commenced, or threatened to initiate, any action to enjoin
      production of any Medical Device, or (iii) commenced, or threatened


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    to
      initiate, any action to enjoin the production of any medical device produced
      at
      any facility where any Medical Device is manufactured, tested or packaged,
      except for any such action that individually or in the aggregate have not had
      and would not reasonably be expected to have a Material Adverse
      Effect.

     

    (h)  To
      the
      Knowledge of Guidant, there are no facts, circumstances or conditions that
      would
      reasonably be expected to form the basis for any investigation, suit, claim,
      action or proceeding against or affecting the Business relating to or arising
      under (i) the FDCA, or (ii) the Social Security Act or regulations of the Office
      of the Inspector General of the Department of Health and Human Services, in
      each
      case individually or in the aggregate that has had or would reasonably be
      expected to have a Material Adverse Effect. 

     

    SECTION
      3.16.   Assets.
      The
      Asset Sellers represent all of the Affiliates of Guidant, other than a
      Transferred Subsidiary, that own, lease, control or hold a license or otherwise
      have a right to use the Purchased Assets. The Assets, together with the
      Intellectual Property to be provided under the License and Technology Transfer
      Agreement and the services to be provided under the Transition Services
      Agreement, constitute all of the assets necessary to operate the Business in
      all
      material respects in the manner as it is now being conducted by Guidant and
      its
      Affiliates. 

     

    SECTION
      3.17.   Brokers.
      Guidant
      will be solely responsible for the fees and expenses of any broker, finder
      or
      investment banker entitled to any brokerage, finder’s or other fee or commission
      in connection with the transactions contemplated by this Agreement based upon
      arrangements made by or on behalf of Guidant, and in no way will such fee or
      expense be deemed an Asset or Assumed Liability.

     

    SECTION
      3.18.   Disclaimer.
      EXCEPT
      AS SET FORTH IN THIS ARTICLE III OR AS MAY BE SET FORTH IN ANY ANCILLARY
      AGREEMENT, NONE OF GUIDANT, ITS AFFILIATES OR ANY OF THEIR RESPECTIVE OFFICERS,
      DIRECTORS, EMPLOYEES OR REPRESENTATIVES MAKE OR HAVE MADE ANY OTHER
      REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT
      OF GUIDANT, ITS AFFILIATES OR THE BUSINESS. ANY SUCH OTHER REPRESENTATION OR
      WARRANTY IS HEREBY EXPRESSLY DISCLAIMED.

     

    ARTICLE
      IV


     

    REPRESENTATIONS
      AND WARRANTIES

    OF
      ABBOTT

     

    Abbott
      hereby represents and warrants to Guidant as follows:

     

    SECTION
      4.01.   Organization
      and Authority.
      (a)  Abbott
      is a corporation duly incorporated, validly existing and in good standing under
      the laws of the State of Illinois and has all necessary corporate power and
      authority to enter into, execute and deliver this Agreement, to carry out its
      obligations hereunder and to consummate the transactions contemplated by this
      Agreement and the Ancillary Agreements to which it is a party. The execution
      and
      delivery by Abbott of this Agreement and the Ancillary Agreements to which
      it is
      a party, the performance 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    by
      Abbott
      of its obligations hereunder and thereunder and the consummation by Abbott
      of
      the transactions contemplated hereby and thereby have been duly authorized
      by
      all requisite corporate action on the part of Abbott. This Agreement has been,
      and upon their execution each of the Ancillary Agreements to which Abbott is
      a
      party will be, duly executed and delivered by Abbott, and, assuming due
      authorization, execution and delivery by the other parties hereto and thereto,
      this Agreement is, and each of the Ancillary Agreements to which Abbott is
      a
      party will be, a legal, valid and binding obligation of Abbott, enforceable
      against it in accordance with its terms.

     

    (b)  Each
      Purchaser (other than Abbott) is an entity duly organized, validly existing
      and,
      where applicable, is in good standing under the Laws of the jurisdiction of
      its
      organization, and has all necessary corporate power and authority to enter
      into,
      execute and deliver each Ancillary Agreement to which it is a party, to carry
      out its obligations thereunder and to consummate the transactions contemplated
      thereby. The execution and delivery by each Purchaser (other than Abbott) of
      each Ancillary Agreement to which it is a party, the performance by such
      Purchaser of its obligations thereunder and the consummation by such Purchaser
      of the transactions contemplated thereby will be, when executed as provided
      in
      this Agreement, duly authorized by all requisite corporate action on the part
      of
      such Purchaser. Each Ancillary Agreement to which a Purchaser (other than
      Abbott) is a party will be, when executed as provided in this Agreement, duly
      executed and delivered by such Purchaser and, assuming due authorization,
      execution and delivery by the other parties thereto, will constitute, when
      executed as provided in this Agreement, a legal, valid and binding obligation
      of
      such Purchaser enforceable against it in accordance with its terms.


     

    SECTION
      4.02.   No
      Conflict.
      Assuming compliance with the HSR Act, the pre-merger notification and waiting
      period requirements of the EU Merger Regulation and the making and obtaining
      of
      all filings, notifications, consents, approvals, authorizations and other
      actions referred to in Section 4.03, the execution, delivery and
      performance by Abbott of this Agreement, and the execution, delivery and
      performance by Abbott and each other Purchaser of each Ancillary Agreement
      to
      which it is a party do not and will not (a) violate, conflict with or
      result in the breach of any provision of the certificate of incorporation or
      bylaws (or similar organizational documents) of Abbott or such other Purchaser,
      as applicable, (b) conflict with or violate any Law or Governmental Order
      applicable to Abbott or such other Purchaser, as applicable, or their respective
      assets, properties or businesses or (c) conflict with, result in any breach
      of, constitute a default (or event which with the giving of notice or lapse
      of
      time, or both, would become a default) under, require any consent under, or
      give
      to others any rights of termination, amendment, acceleration, suspension,
      revocation or cancellation of, any note, bond, mortgage or indenture, contract,
      agreement, lease, sublease, license, permit, franchise or other instrument
      or
      arrangement to which Abbott or such other Purchaser, as applicable, is a party,
      except, in the case of clauses (b) and (c), as would not materially and
      adversely affect the ability of Abbott or such other Purchaser to carry out
      its
      obligations under, and to consummate the transactions contemplated by, this
      Agreement and the Ancillary Agreements.

     

    SECTION
      4.03.   Governmental
      Consents and Approvals.
      The
      execution, delivery and performance by Abbott of this Agreement, and the
      execution, delivery and performance by Abbott and each other Purchaser of each
      Ancillary Agreement to which it is a party do not and will not require any
      consent, approval, authorization or other order of, action by, filing with,
      or


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    notification
      to, any Governmental Authority, except (a) the EU Merger Regulation and the
      requirements of the antitrust Laws of any other relevant jurisdiction or (b)
      where failure to obtain such consent, approval, authorization or action, or
      to
      make such filing or notification, would not prevent or materially delay the
      consummation by Abbott or such other Purchaser, as applicable, of the
      transactions contemplated by this Agreement and the Ancillary
      Agreements.

     

    SECTION
      4.04.   Litigation.
      As of
      the date hereof, no Action by or against Abbott or any other Purchaser is
      pending or, to the knowledge of Abbott and the other Purchasers, threatened,
      that could affect the legality, validity or enforceability of this Agreement,
      any Ancillary Agreement or the consummation of the transactions contemplated
      hereby or thereby.

     

    SECTION
      4.05.   Brokers.
      Abbott
      will be
      solely responsible for the fees and expenses of any broker,
      finder or investment banker entitled to any brokerage, finder’s or other fee or
      commission in connection with the transactions contemplated by this Agreement
      based upon arrangements made by or on behalf of Abbott and the other
      Purchasers.

     

    SECTION
      4.06.   Disclaimer.
      EXCEPT
      AS SET FORTH IN THIS ARTICLE IV OR AS MAY BE SET FORTH IN ANY ANCILLARY
      AGREEMENT, NONE OF ABBOTT, ITS AFFILIATES OR ANY OF THEIR RESPECTIVE OFFICERS,
      DIRECTORS, EMPLOYEES OR REPRESENTATIVES MAKE OR HAVE MADE ANY OTHER
      REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT
      OF ABBOTT OR ITS AFFILIATES. ANY SUCH OTHER REPRESENTATION OR WARRANTY IS HEREBY
      EXPRESSLY DISCLAIMED.

     

    ARTICLE
      V


     

    ADDITIONAL
      AGREEMENTS

     

    SECTION
      5.01.   Acknowledgment.
      The
      parties acknowledge and agree that the entry of the parties hereto into this
      Agreement shall in no way affect the effectiveness of the Transaction Agreement
      and the Transaction Agreement shall remain in full force and effect pursuant
      to
      the terms thereof; provided, however, that to the extent that any provisions
      of
      this Agreement conflict with any provisions of the Transaction Agreement, the
      provisions herein shall control.

     

    SECTION
      5.02.   Access
      to Information; Confidentiality.
      (a)
      From the
      date hereof until the Closing, upon reasonable notice, Guidant shall:
      (i) afford the Purchasers and their authorized representatives reasonable
      access to the offices, properties and books and records of the Business, and
      (ii) furnish to the officers, employees, and authorized agents and
      representatives of the Purchasers such additional financial and operating data
      and other information regarding the Business (or copies thereof) as the
      Purchasers may from time to time reasonably request; provided,
      however,
      that
      any such access or furnishing of information shall be conducted at Abbott’s
      expense, during normal business hours, under the supervision of Guidant’s or its
      Affiliates’ personnel and in such a manner as not to interfere with the normal
      operations of the Business. Notwithstanding anything to the contrary in this
      Agreement, Guidant shall not be required to disclose any information to a
      Purchaser if such disclosure would be reasonably likely to (x) cause significant
      competitive harm to the Business if the transactions contemplated hereby


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    are
      not
      consummated, (y) jeopardize any attorney-client or other legal privilege or
      (z)
      contravene any applicable Laws, fiduciary duty or binding agreement entered
      into
      prior to the date hereof.

     

    (b)  The
      terms
      of the Confidentiality Agreement, dated as of February 2, 2006, among Guidant,
      Boston Scientific and Abbott (the “Confidentiality
      Agreement”)
      are
      hereby incorporated herein by reference and shall continue in full force and
      effect until the Closing, at which time such Confidentiality Agreement and
      the
      obligations of Abbott under this Section 5.02(b) shall terminate; provided,
      however,
      that,
      from and after the Closing, except as would have been permitted under the terms
      of the Confidentiality Agreement, (i) Abbott shall, and shall cause its
      officers, directors, employees, representatives and Affiliates to, treat and
      hold as confidential, and not disclose to any Person, information related to
      the
      discussions and negotiations between the parties regarding this Agreement,
      the
      Transaction Agreement and the transactions contemplated hereby and thereby
      and
      all confidential information relating to Guidant and the Excluded Businesses,
      and (ii) Guidant shall, and shall cause its officers, directors, employees,
      representatives and Affiliates to, treat and hold as confidential, and not
      disclose to any Person, information related to the discussions and negotiations
      between the parties regarding this Agreement, the Transaction Agreement and
      the
      transactions contemplated hereby and thereby and all confidential information
      relating to the Assets and the Business. If this Agreement is, for any reason,
      terminated prior to the Closing, the Confidentiality Agreement shall nonetheless
      continue in full force and effect.

     

    (c)  Nothing
      provided to Abbott pursuant to Section 5.02(a) shall in any way amend or
      diminish Abbott’s obligations under the Confidentiality Agreement. Abbott
      acknowledges and agrees that any Confidential Information (as defined in the
      Confidentiality Agreement) provided to Abbott pursuant to Section 5.02(a) or
      otherwise by or on behalf of Guidant or any officer, director, employee, agent,
      representative, accountant or counsel thereof shall be subject to the terms
      and
      conditions of the Confidentiality Agreement.

     

    SECTION
      5.03.   Regulatory
      and Other Authorizations; Notices and Consents.  (a)
      Each of
      Guidant and Abbott shall use its reasonable best efforts to obtain promptly
      all
      authorizations, consents, orders and approvals of all Governmental Authorities
      that may be or become necessary for the performance of its and the other party’s
      obligations pursuant to, and the consummation of the transactions contemplated
      by, this Agreement. Guidant and Abbott will cooperate with one another in
      promptly seeking to obtain all such authorizations, consents, orders and
      approvals; provided,
      however,
      that
      Guidant shall not be required to pay any fees or other payments to any such
      Governmental Authorities in order to obtain any such authorization, consent,
      order or approval (other than normal filing fees that are imposed by Law on
      Guidant). Neither Guidant nor Abbott shall knowingly take any action that would
      have the effect of materially delaying, impairing or impeding the receipt of
      any
      authorizations, consents, orders and approvals of any Governmental Authority;
      provided,
      however,
      that in
      no way shall reasonable and timely negotiations in good faith by Abbott with
      any
      applicable Governmental Authority relating to the sale, license or other
      disposition or holding separate (through the establishment of a trust or
      otherwise) of Assets or assets or property of Abbott requested or required
      by
      such Governmental Authority in order to obtain such authorization, consent,
      order or approval be deemed to constitute an act materially delaying ,
      impairing, or impeding the receipt of authorizations, consents, orders and
      approvals of such Governmental Authority. Guidant and Abbott each agree to
      make,
      or to cause to be made, (i)
      if
      required, an appropriate filing of a 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    notification
      and report form pursuant to the HSR Act and the EU Merger Regulation and
(ii)
      any
      other filing or notification required by any other applicable Law, in each
      case,
      with respect to the transactions contemplated by this Agreement as promptly
      as
      practicable after the date of this Agreement in the case of the HSR Act and
      the
      EU Merger Regulation, and as promptly as reasonably practicable in the case
      of
      any other filing or notification, and to supply promptly any additional
      information and documentary material that may be requested pursuant to the
      HSR
      Act and the EU Merger Regulation or any other applicable Law. 

     

    (b)  Without
      limiting the generality of Abbott’s undertaking pursuant to Section 5.03(a),
      Abbott shall, on a reasonable and timely basis consistent with Section 5.03(a):
      (i) to the extent necessary to obtain timely approval by a Governmental
      Authority, propose, negotiate, commit to and effect, by consent decree, hold
      separate orders or otherwise, the sale, divestiture or disposition of the
      Carotid Stent Assets, Abbott’s carotid stent assets or any other assets not
      material to the Business or the Assets, or (ii) if a Governmental Authority
      does
      not allow Abbott to acquire the Carotid Stent Assets (for purposes of
      divestiture or otherwise), agree to exclude the Carotid Stent Assets from the
      Assets. If the Carotid Stent Assets are excluded from the Assets, then (x)
      Guidant shall engage an investment banking firm selected by, or satisfactory
      to,
      Abbott and on terms reasonably satisfactory to Abbott to sell the Carotid Stent
      Assets within a reasonable period of time following the Closing or as otherwise
      directed by the applicable Governmental Authorities, (y) Guidant shall remit
      all
      of the proceeds of such sale (net of Taxes and the costs and expenses paid
      by
      Guidant and any of its Affiliates in connection with such sale) to Abbott,
      and
      (z) Abbott shall use its reasonable best efforts to effect the separation of
      the
      Carotid Stent Assets from the Assets, including entering into appropriate
      transition services or similar agreements with Guidant or any other Person
      to
      which the Carotid Stent Assets are divested. For all Tax purposes, the parties
      agree to treat all remittances of proceeds pursuant to this Section 5.03(b)(y)
      as adjustments to the Purchase Price.

     

    (c)  Each
      party to this Agreement shall promptly notify the other party of any
      communication it or any of its Affiliates receives from any Governmental
      Authority relating to the matters that are the subject of this Agreement and
      permit the other party to review in advance any proposed communication by such
      party to any Governmental Authority. Neither party to this Agreement shall
      agree
      to participate in any meeting with any Governmental Authority in respect of
      any
      filings, investigation or other inquiry related to the transactions contemplated
      by this Agreement unless it consults with the other party in advance and, to
      the
      extent permitted by such Governmental Authority, gives the other party the
      opportunity to attend and participate at such meeting. Subject to the
      Confidentiality Agreement, the parties to this Agreement will coordinate and
      cooperate fully with each other in exchanging such information and providing
      such assistance as the other party may reasonably request in connection with
      the
      foregoing and in seeking early termination of any applicable waiting periods
      including under the HSR Act and the EU Merger Regulation. Subject to the
      Confidentiality Agreement, the parties to this Agreement will provide each
      other
      with copies of all correspondence, filings or communications between them or
      any
      of their representatives, on the one hand, and any Governmental Authority or
      members of its staff, on the other hand, with respect to this Agreement and
      the
      transactions contemplated by this Agreement.

     

    SECTION
      5.04.   Notifications.
      Each
      party hereto shall promptly notify the other party in writing of any fact,
      change, condition, circumstance or occurrence or nonoccurrence of 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    any
      event
      of which it is aware that will or is reasonably likely to result in (a) any
      representation or warranty made by such party to be untrue or inaccurate in
      any
      material respect at any time after the date of this Agreement and prior to
      the
      Closing, (b) any material failure on such party’s part to comply with or satisfy
      any covenant, condition or agreement to be complied with or satisfied by it
      hereunder, and (c) the failure of any condition precedent set forth in Article
      VIII of this Agreement; provided,
      however,
      that
      the delivery of any notice pursuant to this Section 5.04 shall not limit or
      otherwise affect the remedies available hereunder to the party receiving such
      notice. In addition, Guidant shall promptly (i) notify Abbott in writing upon
      the occurrence of any event that will or is reasonably likely to result in
      the
      termination of the Merger Agreement, and (ii) to the extent permitted, forward
      copies of any notices received or delivered by Guidant pursuant to the Merger
      Agreement that materially affect the Business, the Assets, the Purchasers’
rights with respect thereto or the likelihood of consummation of the
      transactions contemplated by this Agreement in accordance with the terms hereof
      or of the Merger pursuant to the Merger Agreement. 

     

    SECTION
      5.05.   Release
      of Indemnity Obligations.
      (a)
      Guidant
      and Abbott will cooperate with each other with a view to entering into
      arrangements effective as of the Closing whereby (i) the applicable Purchaser
      would be substituted for Guidant or its Affiliates (other than the Transferred
      Subsidiaries) in any guarantees, letters of comfort, indemnities or similar
      arrangements entered into by Guidant or its Affiliates (other than the
      Transferred Subsidiaries) in respect of the Business (but only to the extent
      such guarantees, letters of comfort, indemnities or arrangements constitute
      Assumed Liabilities) and (ii) Guidant or its Affiliates (other than the
      Transferred Subsidiaries) would be substituted for the applicable Transferred
      Subsidiary in any guarantees, letters of comfort, indemnities or similar
      arrangements entered into by Guidant or its Affiliates in respect of any other
      businesses of Guidant (but only to the extent such guarantees, letters of
      comfort, indemnities or arrangements constitute Excluded Liabilities). If such
      substitution cannot be effected in accordance with this Section 5.05, the
      guaranteeing party shall not terminate such guaranty arrangements without the
      consent of the other party; provided,
      however,
      that
      such party shall enter into a separate guaranty with the other party or its
      Affiliates to guarantee the performance of the obligations of the relevant
      Person pursuant to the contract underlying such guaranty arrangements.


     

    (b)  After
      the
      Closing, each of Guidant and Abbott, at the request of the other party, shall
      use, and shall cause their respective Affiliates to use, reasonable best efforts
      to obtain any consent, substitution or amendment required to novate or assign
      all Assumed Liabilities to the applicable Purchaser and any Excluded Liabilities
      to Guidant or its Affiliates (other than the Transferred Subsidiaries), and
      obtain in writing the unconditional release of Guidant and its Affiliates (other
      than the Transferred Subsidiaries) with respect to the Assumed Liabilities
      and
      the unconditional release of Abbott and its Affiliates with respect to the
      Excluded Liabilities.

     

    SECTION
      5.06.   Tax
      Election.
      (a)
      Abbott,
      in its sole discretion, may require Guidant and/or its Affiliates to participate
      in the making of an election under section 338(h)(10) of the Code with respect
      to the purchase of any Shares that qualify for such treatment, including as
      a
      result of such an election. Guidant shall cooperate with Abbott in effecting
      each such election, including its timely filing.
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)  In
      connection with each such election, Abbott and Guidant shall agree to allocate
      the Country Allocation made to such Transferred Subsidiary under Section 2.04(b)
      among the assets of such Transferred Subsidiary. As promptly as practical
      following the Closing, Abbott will prepare a proposed allocation among the
      assets of each such Transferred Subsidiary and will furnish a copy thereof
      to
      Guidant for its review at least 45 days prior to the due date for the filing
      of
      the Section 338(h)(10) election. Guidant shall have the right to consent to
      such
      allocation, which consent shall not be unreasonably withheld. Such allocations
      shall be binding on Guidant, Abbott and their respective Affiliates in
      completing any income tax returns reflecting gain or loss from the election
      and
      for all other Tax purposes. 

     

    (c)  Abbott
      shall reimburse Guidant and its Affiliates for any additional Taxes incurred
      as
      a result of their participation in any election under section 338(h)(10) of
      the
      Code (including any Taxes resulting from such reimbursement). Such additional
      Taxes shall exist to the extent that the Taxes with respect to the gain realized
      from such election exceeds the Taxes that would have been payable by Guidant
      in
      respect of its sale of the stock of such Transferred Subsidiary absent such
      election, and such additional Taxes shall be determined in accordance with
      Section 5.06(d). Abbott shall make such reimbursement on the due date of the
      relevant Tax Return in which the Code section 338(h)(10) deemed asset sale
      is
      reflected. For Tax purposes, the parties agree that any reimbursement by Abbott
      to Guidant and its Affiliates pursuant to this Section 5.06(c), shall be treated
      as additional Purchase Price.

     

    (d)  Prior
      to
      the Closing, Abbott shall provide Guidant a list of Share purchases for which
      an
      election under Code section 338(h)(10) is being considered. Within thirty days
      after Guidant’s receipt of such list, Guidant shall provide Abbott with a pro
      forma calculation of additional Taxes referred to in Section 5.06(c), together
      with all workpapers relating to those calculations, which workpapers shall
      include all relevant detail, including inside and outside tax basis information
      and consolidated and entity specific net operating loss information. If Abbott
      does not provide comments in writing to Guidant within thirty days after
      Abbott’s receipt of pro forma calculations, then those pro forma calculations
      shall be deemed to be the final pro forma calculation. If, however, Abbott
      submits comments to Guidant within such thirty-day period, Abbott and Guidant
      shall negotiate in good faith to resolve any differences during such thirty-day
      period following Abbott’s submission. If Abbott and Guidant are unable to reach
      a resolution during that thirty-day period, any disputed items shall be
      submitted for resolution to an internationally recognized independent accounting
      firm mutually selected by Abbott and Guidant which shall make a final
      determination as to the disputed items within 30 days after such submission,
      and
      such determination shall be final and binding upon Abbott and Guidant. Abbott
      shall be responsible for the fees and expenses of such accounting firm. Guidant
      shall prepare and file all relevant Tax Returns reflecting the tax consequences
      of the Section 338(h)(10) elections (i) consistent with the principles used
      in
      the preparation of the final pro forma calculation as determined under this
      Section 5.06(d), and (ii) the allocation among the Assets of such Transferred
      Subsidiaries as determined in accordance with Section 5.06(b). The additional
      amount of Taxes shall exist to the extent that Taxes payable with respect to
      the
      gain realized from such election (taking into account all net operating losses
      and other tax attributes that would be attributed to such Transferred Subsidiary
      under applicable Law (“Transferred
      Subsidiary Tax Attributes”))
      exceed Taxes that would have been payable by Guidant in respect of its sale
      of
      stock of such Transferred Subsidiary absent such election, provided that,
      Guidant shall be deemed to have paid Taxes in respect of gain realized from
      such
      election (determined 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    using
      a
      35% marginal rate) to the extent that Guidant is required to absorb net
      operating losses or other tax attributes other than Transferred Subsidiary
      Attributes in excess of those that would have been absorbed had no such election
      been made.

     

    (e)  If
      (i)
      Assets are transferred pursuant to an Intellectual Property Transfer Agreement,
      (ii) an election under Section 338(h)(10) of the Code is not made by Abbott
      with
      respect to the relevant IP Seller, and (iii) Taxes of Guidant with respect
      to
      the sale of such Assets and the sales of the Shares of the IP Seller exceeds
      the
      amount of Taxes of Guidant that would have been due if there had been no such
      sale of Assets, then Abbott shall reimburse Guidant and its Affiliates for
      any
      such additional Taxes incurred as a result of such sale of Assets (including
      Taxes resulting from such reimbursement).

     

    SECTION
      5.07.   Insurance. (a) The
      parties agree to cooperate in structuring the transactions contemplated by
      this
      Agreement so as to preserve to the fullest extent possible available insurance
      coverage with respect to Assumed Liabilities, the Business and any “D&O”
coverage for employees of Guidant or its subsidiaries who primarily perform
      or
      have primarily performed their services for or with respect to the Business
      prior to the Closing.

     

    (b)  Prior
      to
      the Closing, Guidant shall notify all of its insurers of the sale of the
      Business to Abbott and the other Purchasers and the Merger so as to ensure
      that
      there will not be any lapse in insurance coverage of the Business due to any
      failure to make such notification. 

     

    (c)  In
      the
      event that a loss related to the Business which occurred prior to the Closing
      is
      covered by an insurance policy of Guidant insuring, in whole or in part, the
      Business, the parties shall cooperate in filing all necessary insurance claims.
      Upon receiving any payment from the insurance carrier related to such loss,
      Guidant shall promptly remit such amount to Abbott.

     

    (d)  If
      Guidant or any of its Affiliates continues coverage under any insurance policy
      which includes a provision allowing for continued coverage after the expiration
      of such policy for losses that occur during the policy period but which are
      reported following the expiration of the policy (an “Occurrence
      Based Policy”),
      then
      (i) Guidant or such Affiliate shall use its reasonable best efforts, for so
      long
      as coverage under such Occurrence Based Policy remains effective and including
      with respect to the payment of insurance premiums, to assure continued coverage
      under such Occurrence Based Policy with respect to losses related to the
      Business, and (ii) Abbott shall reimburse Guidant for any such insurance
      premiums or other costs allocable the Business in continuing coverage under
      such
      Occurrence Based Policy. 

     

    SECTION
      5.08.   Trademarks.
      (a)
      All
      Trademarks that are used primarily in, or related primarily to, the Business
      and
      do not include the name “Guidant” (i) to the extent that they are owned by
      Guidant and its Affiliates as of the Closing, shall constitute Assets to be
      assigned to the applicable Purchaser at the Closing, and (ii) to the extent
      that
      they are licensed (with a right to sublicense) to Guidant and its Affiliates
      by
      third parties as of the Closing, shall be sublicensed to the applicable
      Purchaser at the Closing. 

     

    (b)  Guidant
      shall retain the ownership of any Trademarks that are used both in the Business
      and any other business of Guidant, that are not used primarily in, or related
      primarily 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    to,
      the
      Business and that do not include the name “Guidant” (the “Non-Guidant
      Licensed Marks”).
      At
      the Closing Guidant shall grant to Abbott and its Affiliates a perpetual,
      non-terminable, non-exclusive, worldwide and royalty free right, license and
      privilege to use the Non-Guidant Licensed Marks solely within the field of
      the
      Business. Except as expressly provided in this Section 5.08, Abbott and its
      Affiliates shall have no right to use in any way the Non-Guidant Licensed
      Marks.

     

    (c)  Guidant
      shall retain the ownership of the trade name “Guidant” and any Trademarks that
      include the name “Guidant” used in the Business as of the Closing (the
“Guidant
      Licensed Marks”
and,
      together with the Non-Guidant Licensed Marks, the “Licensed
      Marks”)
      and,
      except as expressly provided in this Section 5.08, Abbott and its
      Affiliates shall have no right to use in any way the Guidant Licensed
      Marks.

     

    (i)  As
      soon
      as reasonably practicable after the Closing, but in no event later than three
      hundred sixty-five days after the Closing, the Purchasers shall cease to use
      and
      remove or cover the name “Guidant” from all signs, billboards, telephone
      listings, stationary, office forms or other similar materials of the Business,
      unless such use is required by a Governmental Authority. 

     

    (ii)  Subject
      to the terms and conditions contained herein, Guidant hereby grants to Abbott
      and its Affiliates, for a period of five years after the Closing, a
      non-exclusive, non-assignable, worldwide and royalty-free license, right and
      privilege to use the Guidant Licensed Marks on any packages, labels, displays
      promotional and other materials of the products of the Business (“Materials”)
      used
      in the Business as of the Closing for the sole purpose of the operation of
      the
      Business by Abbott and its Affiliates after the Closing.

     

    (d)  Abbott,
      on behalf of itself and its Affiliates, acknowledges and agrees that Guidant
      is
      the owner of all right, title, and interest in and to the Licensed Marks, and
      all such right, title, and interest shall remain with Guidant and its
      Affiliates. All rights not expressly granted to Abbott and/or its Affiliates
      under this Agreement shall remain the exclusive property of Guidant and its
      Affiliates. Abbott shall not (and shall ensure its Affiliates do not) otherwise
      contest, dispute, or challenge the right, title, and interest of Guidant and
      its
      Affiliates in and to the Licensed Marks. Abbott shall not (and shall ensure
      its
      Affiliates do not) file applications to register any Trademarks or apply for
      any
      domain names in any jurisdiction worldwide that are (i) confusingly similar
      to
      any of the Licensed Marks or (ii) consist of, in whole or part, any of the
      Licensed Marks. All goodwill and improved reputation generated by Abbott’s or
      its Affiliates’ use of the Licensed Marks shall inure to the benefit of Guidant.


     

    (e)  Guidant
      hereby agrees and acknowledges that its and its Affiliates’ use of the Licensed
      Marks immediately prior to the Closing on the Materials fully complies with
      Guidant’s standard of quality for the use of the Licensed Marks. If, after the
      Closing, Abbott changes the use of the Licensed Marks on the Materials used
      in
      the Business, Abbott must submit samples of its and its Affiliates’ proposed use
      of the Licensed Marks to Guidant prior to such proposed use so Guidant may
      review such use in accordance with the terms and conditions of this Section
      5.08. Guidant may not unreasonably withhold its consent to any changes in the
      use of the Licensed Marks on the Materials by Abbott. If Guidant does not
      provide any comments to 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Abbott
      within 15 Business Days of receiving such samples, Guidant shall be deemed
      to
      have accepted the changes proposed by Abbott.

     

    (f)  Effective
      upon the fifth anniversary of the Closing, Abbott and its Affiliates shall
      not
      use the Guidant Licensed Marks in connection with the Business or otherwise;
      provided,
      however,
      that
      nothing in this Section 5.08 shall prohibit Abbott and any of its Affiliates
      from selling any inventory in existence as of the fifth anniversary of the
      Closing, which inventory bears any such Guidant Licensed Marks. 

     

    (g)  The
      parties will discuss in good faith whether Abbott may, at its request, continue
      to use the Guidant Licensed Marks after the fifth anniversary of the Closing.
      

     

    (h)  Other
      than as provided in the Supply Agreements, Guidant hereby covenants that, for
      a
      period of five years after the Closing, none of Guidant or any of its Affiliates
      shall use, assign to any third party, or license any third party to use, any
      of
      the Guidant Licensed Marks in connection with products included in the vascular
      intervention or endovascular solutions field. In addition, Guidant, Abbott
      and
      their respective Affiliates will cooperate with each other to avoid any
      confusion in the marketplace during the period when such parties are using
      the
      Guidant name. 

     

    (i)  If
      Guidant or Abbott divests the Carotid Stent Assets in accordance with Section
      5.03(b), then Guidant shall grant to the purchaser of such Carotid Stent Assets
      a license to use the Guidant name in connection therewith in a manner consistent
      with this Section 5.08 for a reasonable transition period.

     

    SECTION
      5.09.   Further
      Action.
      (a)
      Each of
      Guidant and Abbott shall use its reasonable best efforts to take, or cause
      to be
      taken, all appropriate action, to do or cause to be done all things necessary,
      proper or advisable under applicable Law and the agreements included in the
      Assets, and to execute and deliver such documents and other papers and any
      other
      agreements, as may be necessary to carry out the provisions of this Agreement
      and consummate and make effective the transactions contemplated by this
      Agreement or to effect the separation of the Business and the Assets from other
      Guidant assets, including, to the extent practicable, reasonable steps to divide
      Shared Assets that are divisible and to obtain all required consents from third
      parties. 

     

    (b)  Guidant
      agrees that it shall not solicit, initiate, facilitate or pursue any arrangement
      relating to the Business or the Assets with any third parties other than a
      Purchaser prior to the termination of this
      Agreement. 

     

    (c)  To
      the
      extent that any of the transfers, distributions, deliveries and the assumptions
      required to be made in connection with the transactions contemplated by this
      Agreement shall not have been so consummated at Closing, the parties shall
      cooperate and use their reasonable best efforts to effect such consummation
      as
      promptly thereafter as reasonably practicable, including executing and
      delivering such further instruments of transfer and taking such other actions
      as
      the parties may reasonably request in order to effectuate the purposes of this
      Agreement or to more effectively transfer to the applicable Purchaser or confirm
      the applicable Purchaser’s right, title to or interest in, all of the Assets, to
      put the applicable 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Purchaser
      in actual possession and operating control thereof and to permit the applicable
      Purchaser to exercise all rights with respect thereto (including rights under
      contracts and other arrangements as to which the consent of any third party
      to
      the transfer thereof shall not have previously been obtained). In the event
      and
      to the extent that Guidant or Abbott is unable to obtain any required consents,
      Guidant or the applicable Seller shall (i) continue to be bound thereby pending
      assignment to the applicable Purchaser, (ii) at the direction and expense of
      Abbott, pay, perform and discharge fully all of its obligations thereunder
      from
      and after the closing and prior to assignment to the applicable Purchaser,
      (iii)
      exercise or exploit its rights and options under all such agreements, leases,
      licenses and other rights and commitments when and only as reasonably directed
      by Abbott, and (iv) without further consideration therefor, pay, assign and
      remit to the applicable Purchaser promptly all monies, rights and other
      consideration received in respect of such agreements or otherwise make available
      to the applicable Purchaser the benefit of such agreements as contemplated
      by
      this Agreement; provided,
      however,
      that
      none of Guidant nor any of its Affiliates shall be obligated to transfer to
      the
      Purchasers any Business Intellectual Property licensed from third parties that,
      despite the use by Guidant and its Affiliates of such efforts, is incapable
      of
      being transferred. If and when any such consent shall be obtained or such
      agreement, lease, license or other right shall otherwise become assignable,
      Guidant or the applicable Seller shall promptly assign all its rights and
      obligations thereunder to the applicable Purchaser without payment of further
      consideration and Abbott or such Purchaser shall, without the payment of any
      further consideration therefor, assume such rights and obligations.

     

    (d)  In
      the
      event that certain assets, rights or properties which properly constitute Assets
      were not transferred to the applicable Purchaser at Closing, then Guidant shall
      promptly take all steps reasonably necessary to transfer and deliver any and
      all
      of such Assets to the applicable Purchaser without the payment by Abbott of
      any
      further consideration therefor. In the event that certain assets which do not
      properly constitute Assets were transferred to a Purchaser at Closing, then
      the
      applicable Purchaser shall promptly take all steps reasonably necessary to
      transfer and deliver any and all of such assets to Guidant without the payment
      by Guidant of any further consideration therefor.

     

    SECTION
      5.10.   Mixed
      Contracts and Accounts.
      (a)
      Unless
      the parties agree otherwise, any agreement to which Guidant or any of its
      Affiliates is a party prior to the Closing that inures to the benefit or burden
      of each of the Business and the Excluded Assets (a “Mixed
      Contract”)
      shall
      be separated on or as promptly as practicable after the Closing, so that the
      applicable Purchaser and Guidant or its Affiliates shall be entitled to the
      rights and benefits and shall assume the related portion of any Liabilities
      (other than in the case of the Purchasers, Excluded Liabilities) inuring to
      their respective businesses. If any Mixed Contract cannot be so separated,
      Abbott and Guidant shall, and shall cause each of their respective Affiliates
      to, take such other reasonable and permissible action to cause (i) the Assets
      associated with that portion of each Mixed Contract that relates to the Business
      to be enjoyed by the applicable Purchaser; (ii) the Liabilities (other than
      in
      the case of the Purchasers, Excluded Liabilities) related with that portion
      of
      each Mixed Contract that relates to the Business to be borne by the applicable
      Purchaser; (iii) the assets associated with the portion of each Mixed Contract
      that relates to the Excluded Assets to be enjoyed by Guidant or its Affiliates;
      and (iv) the Liabilities (other than in the case of Guidant or its Affiliates,
      Assumed Liabilities) related with that portion of each Mixed Contract that
      relates to the Excluded Assets to be borne by Guidant or its Affiliates. The
      parties will cooperate with each other to effect such separation.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)  Except
      as
      may otherwise be agreed by the parties, the parties shall not seek to assign
      any
      account receivable or accounts payable relating to both the Business and the
      Excluded Assets (a “Mixed
      Account”).
      Abbott and Guidant shall, and shall cause each of their respective Affiliates
      to, take such other reasonable and permissible actions to cause (i) the Assets
      associated with that portion of each Mixed Account that relates to the Business
      to be enjoyed by the applicable Purchaser; (ii) the Liabilities (other than
      in
      the case of the Purchasers, Excluded Liabilities) related with that portion
      of
      each Mixed Account that relates to the Business to be borne by the applicable
      Purchaser; (iii) the assets associated with that portion of each Mixed Account
      that relates to the Excluded Assets to be enjoyed by Guidant or its Affiliates;
      and (iv) the Liabilities (other than in the case of Guidant or its Affiliates,
      Assumed Liabilities) related with that portion of each Mixed Account that
      relates to the Excluded Assets to be borne by Guidant.

     

    SECTION
      5.11.   Intercompany
      Arrangements.
      (a) Prior
      to
      the Closing, Guidant shall, and shall cause its Affiliates to, terminate all
      agreements or arrangements, written or unwritten, of any kind (other than any
      Ancillary Agreements), between (i) Guidant or any of its Affiliates (other
      than
      the Transferred Subsidiaries), on the one hand, and a Transferred Subsidiary,
      on
      the other hand, or (ii) any Transferred Subsidiary, on the one hand, and another
      Transferred Subsidiary, on the other hand.

     

    (b)  Prior
      to
      the Closing, all intercompany receivables, payables and loans between Guidant
      or
      any of its Affiliates (other than the Transferred Subsidiaries), on the one
      hand, and a Transferred Subsidiary, on the other hand, shall be settled,
      capitalized, distributed or otherwise terminated, with the result that there
      will not be intercompany receivables, payables and loans between
      Guidant or any of its Affiliates (other than the Transferred Subsidiaries),
      on
      the one hand, and a Transferred Subsidiary, on the other hand, after the
      Closing.

     

    (c)  Prior
      to
      the Closing, Guidant shall cause all indebtedness for borrowed money of the
      Transferred Subsidiaries to be repaid in full or otherwise satisfied or
      eliminated without any contingent Liability or obligation of any of the
      Transferred Subsidiaries to repay such indebtedness for borrowed money after
      the
      Closing.

     

    SECTION
      5.12.   Restructuring.
      Prior
      to the Closing, Guidant shall, or shall cause the Transferred Subsidiaries
      to,
      use reasonable best efforts to take the actions described in Schedule 5.12
      for
      the purposes of distributing or otherwise transferring from the Transferred
      Subsidiaries to Guidant, Boston Scientific or one of their respective Affiliates
      (other than the Transferred Subsidiaries) any Excluded Assets, Excluded
      Liabilities and employees who are not Transferred Employees.

     

    SECTION
      5.13.   Books,
      Records and Files.
      (a)
      Subject
      to Section 2.02(b), Guidant shall transfer all Books, Records and Files, to
      the
      extent related to the Business, to Abbott or its Affiliates at the Closing
      or as
      soon as practicable thereafter. Abbott shall transfer all Books, Records and
      Files of the Transferred Subsidiaries, to the extent related to the Excluded
      Businesses, to Guidant or its Affiliates at the Closing or as soon as
      practicable thereafter. Abbott may redact any information related to the
      Business from any such Books, Records and Files transferred to Guidant.


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)  Each
      party shall only be obligated to provide Books, Records and Files pursuant
      to
      Section 5.13(a) in the form, condition and format in which they exist as of
      the
      Closing, and in no event shall either party be required to perform any
      improvement, modification, conversion, updating or reformatting of any such
      Books, Records and Files. 

     

    SECTION
      5.14.   Other
      Agreements.
      Nothing
      in this Agreement, the Transaction Agreement or the Ancillary Agreements shall
      prohibit Abbott from pursuing arrangements or agreements with any third party
      which has publicly announced a proposal that the Guidant board of directors
      has
      determined to be, or to be reasonably likely to result in or lead to, a Superior
      Proposal (as defined in the Merger Agreement). 

     

    SECTION
      5.15.   Third
      Party Claims Against Both the Business and the Excluded Business.
      (a)
      Without
      duplication of Section 10.05, from and after the Closing: (i) if Guidant or
      any
      of its Affiliates receives notice of any Mixed Action or any Action from or
      involving any third party that Guidant believes is reasonably likely to involve
      the Business but as to which neither Abbott nor any other Purchaser is a named
      party, then Guidant shall as promptly as practicable provide Abbott notice
      of
      such Action; and (ii) if Abbott or any of its Affiliates receives notice of
      any
      Mixed Action or any Action from or involving any third party that Abbott
      believes is reasonably likely to involve the Excluded Business but as to which
      neither Guidant nor any other Seller is a named party, then Abbott shall as
      promptly as practicable provide Guidant notice of such Action. For purposes
      of
      this Agreement, “Mixed
      Action”
means
      any Action that a party believes is reasonably likely to: (i) include claims
      that both give rise to a right of indemnification under Article X and claims
      as
      to which no right of indemnification under Article X exists; or (ii) include
      claims that both give rise to a right of the indemnification under Article
      X of
      the Abbott Indemnified Parties and claims that give rise to a right of
      indemnification under Article X of the Guidant Indemnified Parties.


     

    (b)  Subject
      to the provisions of Article X, for any Mixed Action, whether arising before
      or
      after the Closing, Abbott or its Affiliates shall have the right to control
      the
      defense of such Mixed Action to the extent such Mixed Action relates to the
      Business, and Guidant or its Affiliates shall have the right to control the
      defense of such Mixed Action to the extent such Mixed Action relates to the
      Excluded Business. 

     

    (c)  Neither
      Abbott nor its Affiliates shall Settle any portion of
      a Mixed
      Action that relates to the Excluded Business without the express written consent
      of Guidant, which may be withheld in its sole discretion. Neither Guidant nor
      its Affiliates shall Settle any portion of a Mixed Action that relates
      to the
      Business without the express written consent of Abbott, which may be withheld
      in
      its sole discretion. Subject to the provisions of Article X: (i) Abbott and
      its
      Affiliates may Settle a Mixed Action to the extent it relates to the Business
      without consent of Guidant so long as such judgment or settlement does not
      negatively impact the Excluded Business, in which case the prior written consent
      of Guidant shall be required, which consent may not be unreasonably withheld
      or
      delayed; (ii) Guidant and its Affiliates may Settle a Mixed Action to the extent
      it relates to the Excluded Business without consent of Abbott so long as such
      judgment or settlement does not negatively impact the Business, in which case
      the prior written consent of Abbott shall be required, which consent may not
      be
      unreasonably withheld or delayed. As used in this Agreement, “Settle”
means,
      with respect to any Action, the consent to the entry of any judgment for such
      Action or entry into any settlement of such Action.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (d)  To
      the
      extent that any of the provisions of this Section 5.15 conflict with any
      provisions of the Ancillary Agreements, the provisions of the Ancillary
      Agreements shall govern.

     

    ARTICLE
      VI


     

    EMPLOYEE
      MATTERS

     

    SECTION
      6.01.   Transferred
      Employees.
      (a)
      As of
      the Closing, the applicable Purchaser or one of its Affiliates shall employ
      the
      U.S. Business Employees (as defined below) who are employed by the Transferred
      Subsidiaries, and on or prior to the Closing, the applicable Purchaser or one
      of
      its Affiliates shall offer employment to each of the other then-current U.S.
      Business Employees, in each case on substantially the same terms and conditions
      as in effect prior to the Closing (except as otherwise provided herein). For
      purposes of this Agreement, “U.S.
      Business Employee”
means
      an employee of a Transferred Subsidiary employed in the United States as of
      the
      Closing, or an employee of the Business employed by an employer domiciled in
      the
      United States, in each case who (except as otherwise expressly agreed to in
      writing by Abbott) primarily performs his or her services for or with respect
      to
      the Business as of the Closing, including any such employee who is inactive
      because of leave of absence, vacation, holiday or long-term disability. For
      purposes of this Agreement, “U.S.
      Transferred Employee”
means
      each U.S. Business Employee of the Transferred Subsidiaries and each other
      U.S.
      Business Employee who accepts the offer of employment by the applicable
      Purchaser or its Affiliate. Schedule 6.01(a) contains a true and complete list,
      as of the date hereof, of each U.S. Business Employee.

     

    (b)  The
      applicable Purchaser or one of its Affiliates shall (i) continue to employ
      each
      Non-U.S. Business Employee (as defined below) of a Transferred Subsidiary as
      of
      the Closing (where employment continues by operation of Law), (ii) continue
      to
      employ each Non-U.S. Business Employee as of the Closing (where employment
      transfers by operation of Law), and (iii) on or prior to the Closing, make
      offers of employment with respect to all other Non-U.S. Business Employees
      whose
      employment does not transfer to the applicable Purchaser by operation of Law,
      in
      each case on substantially the same terms and conditions as in effect for each
      such employee prior to the Closing (except as otherwise provided herein). For
      purposes of this Agreement, “Non-U.S.
      Business Employee”
means
      an employee of the Business employed by an employer domiciled outside the United
      States as of the Closing who (except as otherwise expressly agreed to in writing
      by Abbott) primarily performs his or her services for or with respect to the
      Business outside the U.S. as of the Closing, including any such employee who
      is
      inactive because of leave of absence, vacation, holiday or long-term disability,
      and “Non-U.S.
      Transferred Employee”
means
      each Non-U.S. Business Employee of a Transferred Subsidiary, and each Non-U.S.
      Business Employee whose employment transfers to the applicable Purchaser or
      one
      of its Affiliates by operation of Law, or who accepts the offer of employment
      by
      a Purchaser or one of its Affiliates. Collectively, the U.S. Transferred
      Employees and the Non-U.S. Transferred Employees shall be referred to as
“Transferred
      Employees”.
      Schedule 6.01(b) contains a true and complete list of, as of the date hereof,
      of
      each Non-U.S. Business Employee.

     

    SECTION
      6.02.   Employee
      Benefits.
      (a)
      For a
      period of twelve months following the Closing, Transferred Employees who remain
      in the employment of the applicable 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Purchaser
      or any of its Affiliates shall receive employee benefits that in the aggregate
      are substantially comparable to the employee benefits provided to such employees
      immediately prior to the Closing. For the six-month period immediately following
      the expiration of the twelve-month period described in the preceding sentence,
      the Transferred Employees who remain in the employment of the applicable
      Purchaser or any of its Affiliates shall receive employee benefits that in
      the
      aggregate are substantially comparable to either the employee benefits provided
      to such employees immediately prior to the Closing or the employee benefits
      provided to similarly situated employees of such Purchaser or its Affiliate.
      For
      a period of not less than eighteen months following the Closing, the Transferred
      Employees who remain in the employment of the applicable Purchaser or any of
      its
      Affiliates shall receive base salary or wage rates that are not less than those
      in effect for such Transferred Employees immediately prior to the Closing;
      provided,
      however,
      that
      neither such Purchaser nor any of its Affiliates shall have any obligation
      to
      issue, or adopt any plans or arrangements providing for the issuance of, shares
      of capital stock, warrants, options, stock appreciation rights or other rights
      in respect of any shares of capital stock of any entity or any securities
      convertible or exchangeable into such shares pursuant to any such plans or
      arrangements; and provided,
      further,
      that no
      plans or arrangements of Guidant or Boston Scientific or any of its or their
      respective Affiliates providing for such issuance shall be taken into account
      in
      determining whether employee benefits are substantially comparable in the
      aggregate, except as otherwise required by Law. Except as required by Law or
      expressly provided in Section 6.03(c), nothing contained in this Agreement
      shall
      be construed as requiring a Purchaser or one of its Affiliates to continue
      or
      offer any specific employee benefit plans or to continue the employment of
      any
      specific person. Notwithstanding anything in this Article VI to the contrary,
      the applicable Purchaser and its Affiliates shall be responsible for any
      severance or similar termination payments or to pay severance benefits that
      may
      become payable to any U.S. Business Employee who is not a Transferred Employee,
      and Abbott shall indemnify Guidant and its Affiliates from any and all
      liabilities for such payments. In the event that any of the obligations to
      make
      severance or similar termination payments or to pay severance benefits to U.S.
      Business Employees are covered by cash, insurance contracts, or other assets
      specifically set aside and designated by Guidant or its Affiliates for this
      purpose, Guidant shall cause to be transferred to the applicable Purchaser
      or
      its Affiliate or to the appropriate benefit or compensation plan or arrangement
      of such Purchaser or its Affiliate, such cash, insurance contracts or other
      assets as of the Closing. 

     

    (b)  The
      applicable Purchaser shall recognize the prior service of each Transferred
      Employee as if such service had been performed with such Purchaser (i) for
      purposes of vesting (but not benefit accrual) under such Purchaser’s defined
      benefit pension plan, (ii) for purposes of eligibility for vacation under such
      Purchaser’s vacation program, (iii) for purposes of eligibility and
      participation under any health or welfare plan maintained by such Purchaser
      (other than any post-employment health or post-employment welfare plan), (iv)
      for purposes of eligibility for the company matching contribution under a 401(k)
      savings plan maintained by such Purchaser (it being understood that each
      Transferred Employee who was participating in Guidant’s 401(k) savings plan
      immediately prior to becoming eligible to participate in that 401(k) savings
      plan of such Purchaser or its Affiliates shall be immediately eligible for
      the
      company matching contribution under that 401(k) savings plan maintained by
      such
      Purchaser or one of its Affiliates), and (v) unless covered under another
      arrangement with or of Guidant or any of its Affiliates, for benefit accrual
      purposes under such Purchaser’s severance plan, (in the case of each of clauses
      (i), (ii), (iii), (iv) and (v), solely to the extent that (x) Boston Scientific
      makes 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    such
      plan
      or program available to employees of the Surviving Corporation (as defined
      in
      the Merger Agreement), it being Boston Scientific’s current intention to do so,
      (y) such recognition does not result in any duplication of benefits, but (z)
      not
      for purposes of any other employee benefit plan of the applicable Purchaser
      or
      any of its Affiliates or any other purpose not expressly described in this
      Section 6.02(b), except as required by Law).

     

    (c)  With
      respect to any welfare plan maintained by the applicable Purchaser in which
      Transferred Employees are eligible to participate after the Closing, such
      Purchaser shall (i) waive all limitations as to preexisting conditions and
      exclusions with respect to participation and coverage requirements applicable
      to
      such employees to the extent such conditions and exclusions were satisfied
      or
      did not apply to such employees under the welfare plans maintained by Guidant
      or
      any of its Affiliates prior to the Closing and (ii) provide each Transferred
      Employee with credit for any co-payments and deductibles paid prior to the
      Closing in satisfying any analogous deductible or out-of-pocket requirements
      to
      the extent applicable under any such plan.

     

    (d)  With
      respect to Non-U.S. Transferred Employees, the applicable Purchaser shall,
      and
      shall cause its applicable Affiliates to, comply with all applicable Laws,
      directives and regulations relating to the Non-U.S. Transferred Employees.
      The
      applicable Purchaser and its Affiliates shall be responsible for any severance,
      redundancy or similar termination payments that may become payable to any
      Non-U.S. Business Employee in connection with the transactions contemplated
      by
      this Agreement, and Abbott shall indemnify Guidant and its Affiliates from
      any
      and all liabilities for such payments; provided, however, that to the extent
      that, after the Closing, the applicable Purchaser or any of its Affiliates
      incurs a second severance, redundancy or similar termination payment liability
      with respect to any particular Non-U.S. Business Employee who becomes a Non-U.S.
      Transferred Employee under Section 6.01(b) and who is subsequently terminated
      by
      such Purchaser or its Affiliate for just cause within 12 months of the Closing,
      Guidant and its Affiliates shall indemnify such Purchaser or its Affiliates
      for
      an amount equal to the lesser of the two severance liabilities. In the event
      that any of the obligations to make severance, redundancy or similar termination
      payments to Non-US Business Employees are covered by cash, insurance contracts,
      or other assets specifically set aside and designated by Guidant or its
      Affiliates for this purpose, Guidant shall cause to be transferred to the
      applicable Purchaser or its Affiliates or to the appropriate benefit or
      compensation plan or arrangement of such Purchaser or its Affiliate, such cash,
      insurance contracts, or other assets as of the Closing.

     

    (e)  The
      applicable Purchaser or its Affiliates shall assume all liabilities (other
      than
      any stock option liabilities described in Section 6.03(a)) related to the
      Non-U.S. Transferred Employees, including any liabilities under any Guidant
      Benefit Plan regardless of whether such employee benefit plan transfers
      automatically to such Purchaser or its Affiliates as a result of the
      transactions contemplated by this Agreement. In addition to any cash, insurance
      contracts or other assets that will transfer automatically to the applicable
      Purchaser or its Affiliates or to the Non-U.S. Transferred Employees as a result
      of the transactions contemplated by this Agreement, Guidant shall cause to
      be
      transferred to such Purchaser or its Affiliates, or the appropriate compensation
      or benefit plan of such Purchaser or its Affiliates, such cash, insurance
      contracts, or other assets, if any, specifically set aside and designated by
      Guidant in respect of the liabilities related to the Non-U.S. Transferred
      Employees as of the Closing, including, without limitation, 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    assets
      of
      any applicable compensation or benefit plan of Guidant, to the extent such
      assets do not transfer automatically to such Purchaser or its Affiliates as
      a
      result of the transactions contemplated by this Agreement. However, any such
      transfer shall be subject to the consent of the affected Non-U.S. Transferred
      Employees to the extent required by Law.

     

    (f)  With
      respect to U.S. Transferred Employees, Abbott shall pay Guidant an amount equal
      to the present value as of the Closing of the excess, if any, of the pre-Closing
      liabilities attributable to the U.S. Transferred Employees over the assets,
      accruals and reserves set aside and designated by Guidant or its Affiliates
      in
      respect of those types of liabilities, in each instance to the extent provided
      by, and as determined in accordance with, the principles set forth on Schedule
      6.02(f). Should such designated assets, accruals and reserves allocable to
      such
      liabilities exceed those liabilities, Guidant shall pay Abbott such excess.
      In
      either event, a single payment for the net amount of the difference shall be
      paid within 12 months of the Closing. In addition, Guidant will cause all
      Transferred Employees to be fully vested in their account balances under the
      Guidant Employee Savings and Stock Ownership Plan (as defined in the Merger
      Agreement) and they shall receive a proportionate share of any previously
      unallocated shares of stock that may be allocated to participants under such
      plan in connection with the transactions contemplated by this Agreement and
      the
      Merger Agreement; provided, however, that nothing in this sentence shall require
      Guidant or any of its Affiliates to contribute any additional amount to such
      plan. 

     

    SECTION
      6.03.   General
      Matters.
      (a)
      All
      outstanding Guidant stock options held immediately prior to the Closing by
      any
      Transferred Employee shall be extinguished in accordance with their terms upon
      the Closing, and, in satisfaction thereof, Guidant shall provide or cause to
      be
      provided to the holder of each such option, as soon as practicable following
      the
      Closing, but in all cases within the period necessary to comply with Code
      Section 409A, either (i) a payment in cash equal to the excess of the aggregate
      fair market value of the Guidant shares as of the Closing subject to each such
      option as of the Closing over the aggregate exercise price of such option with
      respect to those shares, net any applicable withholding Taxes, or (ii) a number
      of shares of common stock of Boston Scientific with a fair market value as
      of
      the Closing equal to the excess of the aggregate fair market value of the shares
      subject to each such option over the aggregate exercise price of such option,
      net any applicable withholding Taxes, to be determined by applying the
      conversion formula in Section 5.03(a) of the Merger Agreement to each Guidant
      option to determine the number of shares of common stock of Boston Scientific
      that would have been subject to such option and the exercise price of such
      option, adjusted as if the option holder had not been a Transferred Employee,
      at
      Boston Scientific’s election provided that such election applies to all
      Transferred Employees. 

     

    (b)  Guidant
      shall not, prior to the Closing:

     

    (i)  dispose
      of or otherwise encumber any assets of, or with respect to, any employee or
      independent contractor compensation or benefit plan, program or arrangement
      (1)
      that is sponsored by a Transferred Subsidiary and covers primarily U.S. Business
      Employees or Non-U.S. Business Employees, or (2) for which the Purchasers or
      their Affiliates have assumed liabilities pursuant to the provisions of this
      Article VI; 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (ii)  terminate
      the employment of any U.S. Business Employee or Non-U.S. Business Employee,
      other than in the ordinary course of business consistent with past practice;
      or

     

    (iii)  increase
      the compensation or fringe benefits of any U.S. Business Employee or Non-U.S.
      Business Employee, other than in the ordinary course of business consistent
      with
      past practice.

     

    (c)  After
      the
      Closing, the Purchasers shall maintain and administer the Guidant Change in
      Control Severance Pay Plan for Select Employees and the Guidant Change in
      Control Severance Pay Plan for Employees (the “Guidant
      CIC Plans”)
      with
      respect to any benefits afforded thereunder to any Transferred Employees;
provided,
      however,
      that
      the applicable Purchaser or any of its Affiliates shall have the right to amend
      or terminate the Guidant CIC Plans with respect to the Transferred Employees
      in
      accordance with their terms.

     

    (d)  No
      provision of this Agreement shall create any third party beneficiary rights
      in
      any employee of a Transferred Subsidiary or in any employee of the Business,
      or
      any other current or former employee, independent contractor, or director of
      Guidant, Boston Scientific, any Purchaser or any of its or their respective
      Affiliates, in respect of employment or any other matter.

     

    (e)  With
      respect to Non-U.S. Business Employees, Section 6.03(e) of the Disclosure
      Schedule sets forth a true and complete list of each works council, union or
      other labor organization which has to be notified or consulted or with which
      negotiations need to be conducted in connection with the transactions
      contemplated by this Agreement and each collective bargaining agreement which
      has any impact on the terms and conditions of employment with respect to the
      Non-U.S. Business Employees. Where required under applicable Law, Guidant and
      any of its Affiliates will have, prior to the Closing, properly and timely
      notified, or where appropriate, consulted or negotiated with, the local works
      council, union, labor board or relevant Governmental Authority concerning the
      transactions contemplated by this Agreement. 

     

    SECTION
      6.04.   Mutual
      Non-Solicitation.
      Without
      the prior written consent of Abbott, neither Guidant nor any of its Affiliates
      shall, for a period of two years following the Closing, take any action to
      solicit any sales representative or person performing a similar function who
      is
      a Transferred Employee and who is employed by the Business (whether as an
      employee or independent contractor) to terminate his or her employment with
      the
      Business or to seek or accept employment with Guidant or any of its Affiliates.
      Without the prior written consent of Guidant, Abbott shall not, and shall cause
      each Purchaser and each of its other Affiliates not to, for a period of two
      years following the Closing, take any action to solicit any sales representative
      or person performing a similar function who is employed by Guidant or its
      Affiliates immediately prior to the consummation of the Merger (other than
      any
      Transferred Employee) and who, after the consummation of the Merger, is employed
      by the Surviving Corporation or its successor or any of their Affiliates
      (whether as an employee or independent contractor) and primarily performs his
      or
      her services for or with respect to the Excluded Businesses, to terminate his
      or
      her employment with the Surviving Corporation or its successor or their
      Affiliates or to seek or accept employment with Abbott or any of its Affiliates.
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Notwithstanding
      the foregoing, nothing contained herein shall prevent either party or their
      Affiliates from offering employment or service to persons who respond to a
      general solicitation or advertisement that is not specifically directed at
      them
      (and nothing shall prohibit such general solicitation or
      advertisement).

     

    ARTICLE
      VII


     

    TAXES

     

    SECTION
      7.01.   Apportionment.
      Any Tax
      imposed on any gain or income recognized by reason, or as the result, of (a)
      a
      transfer of any Excluded Assets or Excluded Liabilities of a Transferred
      Subsidiary, or (b) any action required or contemplated by Section 5.11 shall
      be
      attributable to the Pre-Closing Tax Period. With respect to any Tax Return
      for
      any Straddle Period of a Transferred Subsidiary, Abbott will, to the extent
      permitted by Law, elect to treat the Closing as the last day of the taxable
      year
      or period and will apportion any Taxes arising out of or relating to a Straddle
      Period to the Pre-Closing Tax Period and the Post-Closing Tax Period under
      the
“closing-the-books” method as described in Treasury Regulation Section
      1.1502-76(b)(2)(i) (or any similar provision of state, local or foreign law).
      In
      any case where applicable Law does not permit a Transferred Subsidiary to treat
      the Closing as the last day of the taxable year or period, any Taxes arising
      out
      of or relating to a Straddle Period will be apportioned to the Pre-Closing
      Tax
      Period and the Post-Closing Tax Period based on a closing of the books;
      provided, however, that (i) exemptions, allowances or deductions that are
      calculated on an annualized basis (including depreciation, amortization and
      depletion deductions) will be apportioned on a daily pro rata basis, (ii) solely
      for purposes of determining the marginal tax rate applicable to income during
      such period in a jurisdiction in which such tax rate depends upon the level
      of
      income, annualized income will be taken into account, and (iii) real and
      personal property Taxes shall be allocated on a per diem basis.

     

    SECTION
      7.02.   Tax
      Return Filing and Amendment.
      Guidant
      will prepare and file, or cause to be prepared and filed, all Tax Returns of
      each Transferred Subsidiary with respect to periods ending on or before Closing
      to the extent such returns have not been filed prior to Closing, and Guidant
      will pay, or cause to be paid, all Taxes shown as due thereon; provided that
      nothing in this Section 7.02 shall affect the rights of Guidant and its
      Affiliates to indemnification under Section 5.06. Abbott will prepare and file,
      or cause to be prepared and filed all Tax Returns of each Transferred Subsidiary
      with respect to any Straddle Period to the extent such returns have not been
      filed prior to Closing, and Abbott will pay, or cause to be paid, all Taxes
      shown as due thereon; provided that nothing in this Section 7.02 shall affect
      the rights of Abbott to indemnification under Section 10.02(a)(iii). Abbott
      shall deliver, at least 20 days prior to the due date (taking into account
      extensions) for the filing of each such Tax Return for any Straddle Period,
      to
      Guidant a statement setting forth the amount of tax for which Guidant is
      responsible pursuant to Section 10.02(a)(iii) and copies of such Tax Return.
      Guidant shall have the right to review such Tax Return and the statement prior
      to the filing of such Tax Return. Guidant and Abbott agree to consult and
      resolve in good faith any issue arising as a result of the review of such Tax
      Return and statement and mutually consent to the filing of such Tax Return.
      Neither Abbott nor any of its Affiliates shall file any amended Tax Returns
      for
      any periods for or in respect of any Transferred Subsidiary with respect to
      which Abbott is not obligated to prepare, 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    or
      cause
      to be prepared, the original such Tax Returns pursuant to this Section 7.02
      without the prior written consent of Guidant (which consent shall not be
      unreasonably withheld).

     

    SECTION
      7.03.   Refunds.
      Guidant
      shall be entitled to retain or, to the extent actually received by or otherwise
      available to Abbott or its Affiliate, receive immediate payment from Abbott
      or
      any of its Affiliates (including the Transferred Subsidiaries) of, any refund
      or
      credit with respect to Taxes (including without limitation refunds arising
      by
      reason of amended Tax Returns filed after the Closing Date or otherwise) with
      respect to any Pre-Closing Tax Period relating to the Transferred Subsidiaries
      or any Asset Sellers. Any refunds or credits of Taxes with respect to Straddle
      Periods shall be apportioned to the period ending on the date of the Closing
      pursuant to the principles set forth in Section 7.01. Abbott shall be entitled
      to retain or, to the extent actually received by Guidant or its Affiliate,
      receive immediate payment from Guidant or any of its Affiliates of, any refund
      or credit with respect to Taxes (including without limitation refunds arising
      by
      reason of amended Tax Returns filed after the Closing or otherwise) with respect
      to any Post-Closing Tax Period relating to the Transferred Subsidiaries or
      any
      Asset Sellers. Any refunds or credit of Taxes with respect to Straddle Periods
      shall be apportioned to the period beginning after the date of the Closing
      pursuant to the principles set forth in Section 7.01.

     

    SECTION
      7.04.   Resolution
      of Tax Controversies.
      If a
      claim shall be made by any Governmental Authority that might result in an
      indemnity payment to the Abbott or any of its affiliates pursuant to Section
      10.02(a)(iii), Abbott shall promptly notify Guidant of such claim. In
      the
      event that a Governmental Authority determines a deficiency in any Tax, the
      party ultimately responsible for such Tax under this Agreement, whether by
      indemnity or otherwise, shall have authority to determine whether to dispute
      such deficiency determination and to control the prosecution or settlement
      of
      such dispute; provided
      that
      with respect to Straddle Periods, the party with the greater potential Tax
      burden shall control the dispute. The party that is not ultimately responsible
      for such Tax under this Agreement shall have the right to participate at its
      own
      expense in the conduct of any such proceeding involving a Tax claim that would
      adversely affect such party.

     

    SECTION
      7.05.   Tax
      Cooperation.
      Each
      of
      Abbott and Guidant shall provide the other party with such information and
      records and make such of its officers, directors, employees and agents available
      as may reasonably be requested by such other party in connection with the
      preparation of any Tax Return or any audit or other proceeding that relates
      to
      the Transferred Subsidiaries or the Asset Sellers.

     

    SECTION
      7.06.   Conveyance
      Taxes.
      Notwithstanding any other provisions of this Agreement to the contrary, all
      transfer, documentary, recording, sales, use, registration, stamp and other
      similar Taxes (including all applicable real estate transfer Taxes, but
      excluding any Taxes based on or attributable to income or capital gains)
      together with any notarial and registry fees and recording costs imposed by
      any
      taxing authority or other Governmental Authority in connection with the transfer
      of the Shares and the Purchased Assets to the Purchasers (“Conveyance
      Taxes”)
      will
      be shared equally by the Purchasers, on the one hand, and Guidant or the
      applicable Seller, on the other hand, regardless of which Person is obligated
      to
      pay such Conveyance Taxes under applicable Law; provided,
      however,
      that
      the Purchasers shall pay and be solely responsible for all value added, goods
      and services and any other similar taxes 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    that
      are
      recoupable by a Purchaser. To the extent that one party claims any exemptions
      from any Conveyance Taxes, such party shall provide to the other party the
      appropriate exemption certificates. Abbott, Guidant and their respective
      Affiliates will cooperate in timely making and filing all Tax Returns that
      may
      be required to comply with Law relating to Conveyance Taxes. Abbott shall be
      responsible for any incremental Conveyance Taxes incurred as a result of the
      participation by Guidant and its Affiliates in any election under section
      338(h)(10) of the Code.

     

    ARTICLE
      VIII


     

    CONDITIONS
      TO CLOSING

     

    SECTION
      8.01.   Conditions
      to Obligation of Guidant.
      The
      obligation of Guidant to consummate the transactions contemplated by this
      Agreement shall be subject to the fulfillment or written waiver, at or prior
      to
      the Closing, of each of the following conditions:

     

    (a)  Representations,
      Warranties and Covenants.
      Each of
      the representations and warranties of Abbott contained in this Agreement shall
      be true and correct in all material respects as of the Closing, with the same
      force and effect as if made as of the Closing (other than such representations
      and warranties as are made as of another date, which shall be true and correct
      in all material respects as of such date), except in either case where any
      failure of such representations and warranties to be so true and correct would
      not materially delay or prevent the consummation of the transactions
      contemplated hereby in accordance with the terms hereof, and the covenants
      and
      agreements contained in this Agreement to be complied with by Abbott on or
      before the Closing shall have been complied with in all material respects,
      and
      Guidant shall have received a certificate signed on behalf of Abbott by an
      officer of Abbott to such effect;

     

    (b)  Governmental
      Approvals.
      Any
      waiting period (and any extension thereof) under the HSR Act and the EU Merger
      Regulation applicable to the purchase of the Business contemplated by this
      Agreement, and any agreement with a Governmental Authority not to consummate
      the
      transactions contemplated by this Agreement, shall have expired or shall have
      been terminated, and Boston Scientific, Guidant or Abbott, as the case may
      be,
      shall have obtained all authorizations, consents, orders and approvals of all
      Governmental Authorities that, if not received, would make any of the
      transactions contemplated by this Agreement or any of the other Ancillary
      Agreements illegal or otherwise prohibit the consummation of such
      transactions;

     

    (c)  No
      Order.
      No
      Governmental Authority shall have enacted, issued, promulgated, enforced or
      entered any Law or Governmental Order (whether temporary, preliminary or
      permanent) that has the effect of making the transactions contemplated by this
      Agreement illegal or otherwise prohibiting the consummation of such
      transactions; and

     

    (d)  Closing
      Conditions Satisfied.
      All of
      the respective conditions to Boston Scientific’s, Sub’s and Guidant’s
      obligations to consummate the Merger, as set forth in the Merger Agreement,
      shall have been satisfied or waived, and each of Boston Scientific and Sub
      shall
      have notified Guidant, and Guidant shall have notified Boston Scientific


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    and
      Sub,
      in writing (with copies of such notices having been delivered to Abbott) that
      it
      is ready, willing and able to consummate the Merger and that it intends to
      consummate the Merger immediately following the consummation of the transactions
      contemplated by this Agreement and the Transaction Agreement.

     

    SECTION
      8.02.   Conditions
      to Obligation of Abbott.
      The
      obligation of Abbott to consummate the transactions contemplated by this
      Agreement shall be subject to the fulfillment or written waiver, at or prior
      to
      the Closing, of each of the following conditions:

     

    (a)  Representations,
      Warranties and Covenants.
      Each of
      the representations and warranties of Guidant contained in this Agreement shall
      be true and correct in all material respects as of the Closing, with the same
      force and effect as if made as of the Closing (other than such representations
      and warranties as are made as of another date, which shall be true and correct
      in all material respects as of such date), except in either case where any
      failure of such representations and warranties to be so true and correct would
      not materially delay or prevent the consummation of the transactions
      contemplated hereby in accordance with the terms hereof, and the covenants
      and
      agreements contained in this Agreement to be complied with by Guidant on or
      before the Closing shall have been complied with in all material respects,
      and
      Abbott shall have received a certificate signed on behalf of Guidant by an
      officer of Guidant to such effect;

     

    (b)  Governmental
      Approvals.
      Any
      waiting period (and any extension thereof) under the HSR Act or the EU Merger
      Regulation applicable to the purchase of the Business contemplated by this
      Agreement, and any agreement with a Governmental Authority not to consummate
      the
      transactions contemplated by this Agreement, shall have expired or shall have
      been terminated, and Boston Scientific, Guidant or Abbott, as the case may
      be,
      shall have obtained all authorizations, consents, orders and approvals of all
      Governmental Authorities that, if not received, would make any of the
      transactions contemplated by this Agreement illegal or otherwise prohibit the
      consummation of such transactions;

     

    (c)  No
      Order.
      No
      Governmental Authority shall have enacted, issued, promulgated, enforced or
      entered any Law or Governmental Order (whether temporary, preliminary or
      permanent) that has the effect of making the transactions contemplated by this
      Agreement illegal or otherwise prohibiting the consummation of such
      transactions; and

     

    (d)  Closing
      Conditions Satisfied.
      All of
      the respective conditions to Boston Scientific’s, Sub’s and Guidant’s
      obligations to consummate the Merger, as set forth in the Merger Agreement,
      shall have been satisfied or waived, and each of Boston Scientific and Sub
      shall
      have notified Guidant, and Guidant shall have notified Boston Scientific and
      Sub, in writing (with copies of such notices having been delivered to Abbott)
      that it is ready, willing and able to consummate the Merger and that it intends
      to consummate the Merger immediately following the consummation of the
      transactions contemplated by this Agreement and the Transaction Agreement.
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      IX


     

    TERMINATION

     

    SECTION
      9.01.   Termination.
      This
      Agreement may be terminated, or in the case of clause (d) below shall terminate,
      at any time prior to the Closing in the following circumstances:

     

    (a)  by
      the
      mutual written consent of Guidant and Abbott;

     

    (b)  by
      either
      Guidant or Abbott, if the Closing shall not have occurred by September 30,
      2006;
provided,
      however,
      that
      the right to terminate this Agreement under this Section 9.01(b) shall not
      be available to any party whose failure to fulfill any obligation under this
      Agreement shall have been the cause of, or shall have resulted in, the failure
      of the Closing to occur on or prior to such date; 

     

    (c)  by
      either
      Guidant or Abbott in the event that any Governmental Order restraining,
      enjoining or otherwise prohibiting the transactions contemplated by this
      Agreement shall have become final and non-appealable; or

     

    (d)  immediately,
      without any action by either Guidant or Abbott, upon any termination of the
      Merger Agreement. 

     

    SECTION
      9.02.   Effect
      of Termination.
      In the
      event of termination of this Agreement as provided in Section 9.01, this
      Agreement shall forthwith become void and there shall be no liability on the
      part of either party hereto except (a) as set forth in Section 5.02
      and Article XI and (b) that nothing herein shall relieve either party from
      liability for any breach of this Agreement occurring prior to such
      termination.

     

    ARTICLE
      X


     

    INDEMNIFICATION

     

    SECTION
      10.01.   Survival
      of Representations and Warranties.
      The
      representations and warranties of the parties hereto contained in this Agreement
      and the Transaction Agreement shall terminate at the Closing. 

     

    SECTION
      10.02.   Indemnification
      by Guidant.
      (a)
      From and
      after the Closing, Abbott and its Affiliates, officers, directors, agents,
      successors and assigns (the “Abbott
      Indemnified Parties”)
      shall
      be indemnified and held harmless by Guidant for and against all losses, damages,
      claims, costs and expenses, interest, awards, judgments and penalties (including
      reasonable attorneys’ and consultants’ fees and expenses) actually suffered or
      incurred by them (hereinafter, a “Loss”)
      to the
      extent arising out of or related to:

     

    (i)  the
      Excluded Assets; 

     

    (ii)  the
      Excluded Liabilities; 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (iii)  Taxes
      of
      Boston Scientific, Guidant or any of their Affiliates (including any Liability
      arising as a transferee or successor by contract or otherwise and including
      any
      Taxes arising under Regulation 1.1502-6 or similar Law) attributable to any
      Pre-Closing Tax Period (other than Taxes referred to in the first sentence
      of
      Section 5.06(c)); and

     

    (iv)  Taxes
      of
      Abbott or any of its Affiliates for any Post-Closing Period that would not
      have
      been incurred but for a net adjustment to a Pre-Closing Period Tax Liability
      of
      Guidant or any of its Affiliates.

     

    (b)  In
      addition to the provisions of Section 10.02(a), from and after the Closing,
      the
      Abbott Indemnified Parties shall be indemnified and held harmless by Guidant
      for
      and against (i) any action between the date hereof and the Closing with respect
      to the Assets, the U.S. Business Employees, the Non-U.S. Business Employees
      or
      the Business that would have been a breach of the covenants contained in Section
      4.01 of the Merger Agreement if such covenants had been made with respect to
      the
      Assets, the U.S. Business Employees, the Non-U.S. Business Employees or the
      Business rather than having been made with respect to Guidant’s assets,
      employees and businesses; provided,
      however,
      that
      Guidant shall have no obligation to indemnify any Abbott Indemnified Party
      pursuant to this clause (i) unless and until the aggregate amount of all such
      amounts indemnifiable under this clause (i) exceeds $100,000,000, in which
      case
      Guidant will only be liable for amounts indemnifiable under this clause (i)
      in
      excess of such amount; and (ii) the occurrence of a Material Adverse Effect
      between the date of this Agreement and the Closing. Guidant and Abbott will
      use
      their reasonable best efforts to agree on the amount of any indemnification
      payable under this Section 10.02(b). In the event Guidant and Abbott are unable
      to reach agreement on such amount despite the use of such efforts, such amount
      shall be determined by an independent investment banking firm or accounting
      firm
      (depending on the subject matter of the claim) of international reputation
      reasonably acceptable to each of Guidant and Abbott using customary valuation
      methodologies. The determination of such independent investment banking firm
      shall be final and binding on Guidant and Abbott. The fees and expenses of
      such
      independent investment banking firm shall be shared equally between Guidant
      and
      Abbott. 

     

    SECTION
      10.03.   Indemnification
      by Abbott.
      From
      and after the Closing, Guidant and its Affiliates, officers, directors, agents,
      successors and assigns shall be indemnified and held harmless by Abbott for
      and
      against any and all Losses to the extent arising out of or related to the
      Business (other than the Excluded Liabilities) and the Assumed Liabilities,
      except for Taxes described in Section 10.02(iii).

     

    SECTION
      10.04.   Limits
      on Indemnification.
      (a)
      Notwithstanding anything to the contrary contained in this Agreement, neither
      party hereto shall have any Liability under Section 10.02(a)
      for any
      punitive, incidental, consequential, special or indirect damages, except to
      the
      extent that any such damages are awarded in connection with a Third Party Claim
      against an indemnified party and such indemnified party is entitled to be
      indemnified hereunder as a result of the facts or circumstances giving rise
      to
      such Third Party Claim.

     

    (b)  For
      all
      purposes of this Article X, “Losses” shall be net of (i) any insurance or other
      recoveries actually paid to an indemnified party or its Affiliates in connection
      with the 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    facts
      giving rise to the right of indemnification, and (ii) any Tax benefit to which
      an indemnified party or any of its Affiliates is or will be entitled in
      connection with the facts giving rise to the right of
      indemnification.

     

    SECTION
      10.05.   Notice
      of Loss; Third Party Claims.
      (a) An
      indemnified party shall give the indemnifying party notice of any matter that
      an
      indemnified party has determined has given or could give rise to a right of
      indemnification under this Agreement, within 60 days of such determination,
      stating the amount of the Loss, if known, and method of computation thereof,
      and
      containing a reference to the provisions of this Agreement in respect of which
      such right of indemnification is claimed or arises. 

     

    (b)  If
      an
      indemnified party shall receive notice of any Action from or involving any
      third
      party that the indemnified party believes is reasonably likely to give rise
      to a
      right of indemnification under this Article X (each, a “Third
      Party Claim”),
      then,
      as promptly as practicable after the receipt of such notice, the indemnified
      party shall give the indemnifying party notice of such Third Party Claim,
      stating the amount of the Loss, if known, and method of computation thereof
      and
      containing a reference to the provisions of this Agreement in respect of which
      such right of indemnification is claimed or arises; provided,
      however,
      that
      the failure to provide such notice shall not release the indemnifying party
      from
      any of its obligations under this Article X except to the extent that such
      failure actually results in a detriment to the indemnifying party and shall
      not
      relieve the indemnifying party from any other Liability that it may have to
      any
      indemnified party other than under this Article X. The indemnifying party
      shall be entitled to assume and control the defense of such Third Party Claim
      at
      its expense and through counsel reasonably satisfactory to the indemnified
      person if it gives notice of its intention to do so to the indemnified party
      within 15 days of the receipt of such notice from the indemnified party. If
      the
      indemnifying party elects to undertake any such defense against a Third Party
      Claim, the indemnified party may participate in such defense at its own expense.
      The indemnified party shall reasonably cooperate with the indemnifying party
      in
      such defense and make available to the indemnifying party, at the indemnifying
      party’s expense, all witnesses, pertinent records, materials and information in
      the indemnified party’s possession or under the indemnified party’s control
      relating thereto as is reasonably required by the indemnifying party. If the
      indemnifying party elects to direct the defense of any such claim or proceeding,
      it shall not consent to the entry of any judgment or enter into any settlement
      with respect to such Third Party Claim without the prior written consent of
      the
      indemnified party, which consent shall not be unreasonably withheld or delayed.
      No indemnifying party shall be liable for any settlement of a Third Party Claim
      effected without such indemnifying party’s prior written consent, which consent
      shall not be unreasonably withheld or delayed.

     

    SECTION
      10.06.   Tax
      Treatment of Indemnity Payments.
      For all
      Tax purposes, the parties agree to treat all payments made under any indemnity
      provisions contained in this Agreement as adjustments to the Purchase Price,
      except to the extent applicable Law requires otherwise.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      XI


     

    GENERAL
      PROVISIONS

     

    SECTION
      11.01.   Expenses.
      Except
      as otherwise specified in this Agreement, all costs and expenses, including
      fees
      and disbursements of counsel, financial advisors and accountants, incurred
      in
      connection with this Agreement and the other Ancillary Agreements and the
      transactions contemplated hereby and thereby shall be borne by the party
      incurring such costs and expenses, whether or not the Closing shall have
      occurred.

     

    SECTION
      11.02.   Notices.
      All
      notices, requests, claims, demands and other communications hereunder 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 an internationally
      recognized overnight courier service, by facsimile, by e-mail or by registered
      or certified mail (postage prepaid, return receipt requested) to the respective
      parties hereto at the following addresses (or at such other address for a party
      as shall be specified in a notice given in accordance with this
      Section 11.02):

     

    
      	
            	(a)	
              if
                to Guidant or any Seller:

            


    

     

    Guidant
      Corporation

    111
      Monument Circle, 29th Floor

    Indianapolis,
      Indiana 46204

    Fax:
      (317) 971-2119

    Attention:
      General Counsel

     

    with
      a
      copy to:

     

    Skadden,
      Arps, Slate, Meagher & Flom LLP

    333
      West
      Wacker Drive

    Chicago,
      Illinois 60606

    Fax:
      (312) 407-0411

    Attention:
      Charles W. Mulaney, Jr.

    Brian
      W.
      Duwe

     

    
      	
            	(b)	
              if
                to Abbott or any other Purchaser:

            


    

     

    Abbott
      Laboratories

    Dept.
      0392, Bldg. AP6D 

    100
      Abbott Park Road

    Abbott
      Park, Illinois 60064-3500

    Fax:
      (847)
      935-8207

    Attention:
      Chief Operating Officer, Medical Products Group

     

    with
      a
      copy to:

     

    Abbott
      Laboratories

    Dept.
      364, Bldg. AP6D

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    100
      Abbott Park Road

    Abbott
      Park, Illinois 60064-6020 USA

    Fax:
      (847) 938-6277

    Attention:
      General Counsel
      

     

    and
      a
      copy to:

     

    Simpson
      Thacher & Bartlett LLP

    425
      Lexington Avenue

    New
      York,
      NY 10017-3903

    Fax:
      (212)
      455-2502

    Attention:
      Charles I. Cogut

    William
      E. Curbow

     

    SECTION
      11.03.   Public
      Announcements.
      Each
      party to this Agreement shall consult with the other party before issuing,
      and
      shall provide the other party the opportunity to review and comment upon, any
      press release or other public announcement in respect of this Agreement or
      the
      transactions contemplated hereby and shall not issue any press release or other
      public statements or otherwise communicate with any news media regarding this
      Agreement and/or the transactions contemplated hereby without the consultation
      and prior written consent of the other party unless otherwise required by Law
      or
      applicable stock exchange regulation and then only with such advance notice
      to
      and consultation with the other party as is practical. The parties to this
      Agreement shall cooperate as to the timing and contents of any such press
      release, public announcement or communication. The parties agree that they
      shall
      each issue a press release announcing the execution of this Agreement, the
      contents of which shall be reasonably satisfactory to the other
      party.
      Notwithstanding the foregoing, neither party shall have any obligation to
      consult with the other party or provide the other party with an opportunity
      to
      review and comment upon any press release or other public announcement
      announcing a termination of this Agreement, and such party may issue such press
      release or public announcement or otherwise communicate with any news media
      regarding such termination without the consent of the other party; provided,
      however,
      that
      the non-terminating party shall have received advance written notice of the
      other party’s intention to terminate this Agreement. 

     

    SECTION
      11.04.   Severability.
      If any
      term or other provision of this Agreement is invalid, illegal or incapable
      of
      being enforced by any Law or public policy, all other terms and provisions
      of
      this Agreement shall nevertheless remain in full force and effect for so long
      as
      the economic or legal substance of the transactions contemplated by this
      Agreement is not affected in any manner materially adverse to either party
      hereto. Upon such determination that any term or other provision is invalid,
      illegal or incapable of being enforced, the parties hereto shall negotiate
      in
      good faith to modify this Agreement so as to effect the original intent of
      the
      parties as closely as possible in an acceptable manner in order that the
      transactions contemplated by this Agreement are consummated as originally
      contemplated to the greatest extent possible.

     

    SECTION
      11.05.   Entire
      Agreement.
      This
      Agreement, the Transaction Agreement, the Confidentiality Agreement and the
      Ancillary Agreements constitute the entire agreement of the parties hereto
      with
      respect to the subject matter hereof and thereof and 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    supersede
      all prior agreements and undertakings, both written and oral, between Guidant
      and Abbott with respect to the subject matter hereof and thereof.

     

    SECTION
      11.06.   Assignment.
      This
      Agreement may not be assigned without the express written consent of Guidant
      and
      Abbott (which consent may be granted or withheld in the sole discretion of
      Guidant or Abbott), as the case may be; provided,
      however,
      that
      (a) either party may, without the consent of the other party, assign its rights
      and obligations, in whole or in part, under this Agreement to one or more of
      its
      controlled Affiliates, except that no such assignment shall relieve the
      assigning party from the performance of its obligations hereunder, and (b)
      Abbott may, without the consent of Guidant, assign its rights and obligations,
      in whole or in part, under this Agreement to any designee of Abbott (in the
      event Abbott divests any of the Assets that would otherwise be acquired by
      Abbott pursuant hereto due to applicable antitrust laws and regulations) or
      to
      any acquiror of all or substantially all of Abbott’s vascular intervention
      business.

     

    SECTION
      11.07.   Amendment.
      This
      Agreement may not be amended or modified except (a) by an instrument in
      writing signed by, or on behalf of, Guidant and Abbott or (b) by a waiver
      in accordance with Section 11.08.

     

    SECTION
      11.08.   Waiver.
      Either
      party to this Agreement may (a) extend the time for the performance of any
      of the obligations or other acts of the other party, (b) waive any
      inaccuracies in the representations and warranties of the other party contained
      herein or in any document delivered by the other party pursuant hereto or
      (c) to the extent permitted by applicable Law, waive compliance with any of
      the agreements of the other party or conditions to such party’s obligations
      contained herein. Any such extension or waiver shall be valid only if set forth
      in an instrument in writing signed by the party to be bound thereby. Any waiver
      of any term or condition shall not be construed as a waiver of any subsequent
      breach or a subsequent waiver of the same term or condition, or a waiver of
      any
      other term or condition of this Agreement. The failure of either party hereto
      to
      assert any of its rights hereunder shall not constitute a waiver of any of
      such
      rights.

     

    SECTION
      11.09.   No
      Third Party Beneficiaries.
      This
      Agreement shall be binding upon and inure solely to the benefit of the parties
      hereto and their respective successors and permitted assigns and nothing herein
      is intended to or shall confer upon any other Person any legal or equitable
      right, benefit or remedy of any nature whatsoever, including any rights of
      employment for any specified period, under or by reason of this
      Agreement.

     

    SECTION
      11.10.   Other
      Remedies; Specific Performance.
      Except
      as otherwise provided herein, any and all remedies herein expressly conferred
      upon a party will be deemed cumulative with and not exclusive of any other
      remedy conferred hereby, or by Law or equity upon such party, and the exercise
      by a party of any one remedy will not preclude the exercise of any other remedy.
      The parties hereto agree that irreparable damage would occur in the event that
      any provision of this Agreement is not performed in accordance with its specific
      terms or is otherwise breached. It is accordingly agreed that the parties shall
      be entitled to seek an injunction or injunctions to prevent breaches of this
      Agreement and to enforce specifically the terms and provisions hereof in any
      court of the United States or any state having jurisdiction, this being in
      addition to any other remedy to which they are entitled at Law or in
      equity.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SECTION
      11.11.   Interpretive
      Rules.
      The
      words “hereof,” “herein” and “hereunder” and words of similar import when used
      in this Agreement refer to this Agreement as a whole and not to any particular
      provision of this Agreement, and all Article and Section references are to
      this
      Agreement unless otherwise specified. The words “include,” “includes” and
“including” will be deemed to be followed by the phrase “without limitation.”
The word “days” means calendar days unless otherwise specified herein. The table
      of contents and headings contained in this Agreement are for reference purposes
      only and shall not affect in any way the meaning or interpretation of this
      Agreement. No provision of this Agreement shall be construed to require either
      party or their respective officers, directors, subsidiaries or Affiliates to
      take any action which would violate or conflict with any applicable Law. The
      word “if” means “if and only if.” The word “or” shall not be exclusive. The
      meanings given to terms defined herein will be equally applicable to both the
      singular and plural forms of such terms. Whenever the context may require,
      any
      pronoun includes the corresponding masculine, feminine and neuter forms. Except
      as otherwise expressly provided herein, all references to “dollars” or “$” will
      be deemed references to the lawful money of the United States of
      America.

     

    SECTION
      11.12.   Guarantees
      of Performance.
      (a)
      Abbott
      hereby (i) absolutely, unconditionally and irrevocably guarantees all of the
      obligations of each Purchaser under this Agreement and the Ancillary Agreements
      to which such Purchaser is a party, and (ii) unconditionally and irrevocably
      waives any right to revoke this guarantee and acknowledges that this guarantee
      is continuing in nature and applies to all obligations of such Purchaser under
      this Agreement and the Ancillary Agreements. The obligations of Abbott under
      or
      in respect of this guarantee are independent of the guaranteed obligations,
      and
      a separate action or actions may be brought and prosecuted against Abbott to
      enforce this guarantee, irrespective of whether any action is brought against
      the applicable Purchaser or whether such Purchaser is joined in any such action
      or actions.

     

    (b)  Guidant
      hereby (i) absolutely, unconditionally and irrevocably guarantees all of the
      obligations of each Seller under this Agreement and the Ancillary Agreements
      to
      which such Seller is a party, and (ii) unconditionally and irrevocably waives
      any right to revoke this guarantee and acknowledges that this guarantee is
      continuing in nature and applies to all obligations of such Seller under this
      Agreement and the Ancillary Agreements. The obligations of Guidant under or
      in
      respect of this guarantee are independent of the guaranteed obligations, and
      a
      separate action or actions may be brought and prosecuted against Guidant to
      enforce this guarantee, irrespective of whether any action is brought against
      the applicable Seller or whether such Seller is joined in any such action or
      actions.

     

    SECTION
      11.13.   Governing
      Law.
      This
      Agreement shall be governed by, and construed in accordance with, the laws
      of
      the State of New York. All Actions arising out of or relating to this Agreement
      shall be heard and determined exclusively in any New York federal court sitting
      in the Borough of Manhattan of The City of New York; provided,
      however,
      that if
      such federal court does not have jurisdiction over such Action, such Action
      shall be heard and determined exclusively in any New York state court sitting
      in
      the Borough of Manhattan of The City of New York. Consistent with the preceding
      sentence, the parties hereto hereby (a) submit to the exclusive jurisdiction
      of
      any federal or state court sitting in the Borough of Manhattan of The City
      of
      New York for the purpose of any Action arising out of or relating to this
      Agreement brought by either party hereto and (b) irrevocably waive, and
      agree not to assert by way of 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    motion,
      defense, or otherwise, in any such Action, any claim that it is not subject
      personally to the jurisdiction of the above-named courts, that its property
      is
      exempt or immune from attachment or execution, that the Action is brought in
      an
      inconvenient forum, that the venue of the Action is improper, or that this
      Agreement or the transactions contemplated by this Agreement may not be enforced
      in or by any of the above-named courts. Each party further irrevocably consents
      to the service of process out of any of the aforementioned courts in any such
      Action by the mailing of copies thereof by mail to such party at its address
      set
      forth in this Agreement, such service of process to be effective upon
      acknowledgment of receipt by registered mail; provided,
      however,
      that
      nothing in this Section 11.13 shall affect the right of any party to serve
      legal
      process in any other manner permitted by law. The consent to jurisdiction set
      forth in this Section 11.13 shall not constitute a general consent to service
      of
      process in the State of New York and shall have no effect for any purpose except
      as provided in this Section 11.13.

     

    SECTION
      11.14.   Waiver
      of Jury Trial.
      EACH OF
      THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
      LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION
      DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
      AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH OF THE
      PARTIES HERETO HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY
      OF
      THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY
      WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER,
      AND
      (B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND
      THE
      TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER
      THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
      11.14.

     

    SECTION
      11.15.   Exchange
      Rate.
      If
      applicable Law requires that any payment pursuant to this Agreement be made
      in
      local currency, the parties shall use the applicable exchange rate published
      in
      the Wall Street Journal three Business Days prior to the Closing.

     

    SECTION
      11.16.   Counterparts.
      This
      Agreement may be executed and delivered (including by facsimile transmission)
      in
      one or more counterparts, and by the different parties hereto in separate
      counterparts, each of which when executed shall be deemed to be an original,
      but
      all of which taken together shall constitute one and the same
      agreement.

     

    


     

    
 

     

     

     

     

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

 

    IN
      WITNESS WHEREOF, Guidant and Abbott have caused this Agreement to be executed
      as
      of the date first written above by their respective officers thereunto duly
      authorized.

     

    
      	 	 	 
	 	
              GUIDANT
                CORPORATION

            
	 
 	 
 	 
 
	 	By:  	/s/ Bernard
              E. Kury
	 	
              

              Name:
                Bernard E. Kury

            
	 	
              Title:
                Vice President and General Counsel

            


    

     

     

    
      	 	 	 
	 	
              ABBOTT
                LABORATORIES

            
	 
 	 
 	 
 
	 	By:  	/s/ Richard
              A. Gonzalez
	 	
              

              Name:
                Richard A. Gonzalez

            
	 	
              Title:
                President and Chief Operating
                Officer 

            


    

     

    


    


     

    


     

    


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

      


      EXHIBIT
        A

      


      


      


      


      FORM
        OF
        ASSUMPTION AGREEMENT


      
        
          
            


          

           

        

        
           

          
            

          

        

        
           

          
          

        

      



      EXHIBIT
        B

      


      


      


      


      FORM
        OF
        BILL OF SALE

      


      



      
        
          
            


          

           

        

        
           

          
            

          

        

        
           

          
          

        

      



      EXHIBIT
        C

      


      


      


      FORM
        OF
        BUSINESS TRANSFER AGREEMENT

      


      


      



      
        
          
            


          

           

        

        
           

          
            

          

        

        
           

          
          

        

      



      EXHIBIT
        D

      


      


      


      FORM
        OF
        EQUITY PURCHASE AGREEMENT

      


      


      


      



      
        
          
            


          

           

        

        
           

          
            

          

        

        
           

          
          

        

      



      EXHIBIT
        E

      


      


      


      FORM
        OF
        INTELLECTUAL PROPERTY TRANSFER AGREEMENT

      


      


      


      



      
        
          
            


          

           

        

        
           

          
            

          

        

        
           

          
          

        

      



      EXHIBIT
        F

      


      


      


      FORM
        OF
        LICENSE AND TECHNOLOGY TRANSFER AGREEMENT

      


      


      


      



      
        
          
            


          

           

        

        
           

          
            

          

        

        
           

          
          

        

      



      EXHIBIT
        G

      


      


      


      FORM
        OF
        NOTE

      


      


      


      



      
        
          
            


          

           

        

        
           

          
            

          

        

        
           

          
          

        

      



      EXHIBIT
        H

      


      


      


      FORM
        OF
        RELEASE

      


      


      


      



      
        
          
            


          

           

        

        
           

          
            

          

        

        
           

          
          

        

      



      EXHIBIT
        I

      


      


      


      FORM
        OF
        SUPPLY AGREEMENT


      
        
           

        

        
           

          
            

          

        

        
           

        

      


      EXHIBIT
        J

      


      


      


      FORM
        OF
        TRANSITION SERVICES AGREEMENT